Has anyone else in Leon County Tx experienced the stoppage of royally checks due to “over payment”?
Oil companies frequently make prior period adjustments (PPA), both up and down, due to determination that the oil and gas prices or volumes were overstated or understated in the prior month or years. Less commonly, the royalty decimal is changed based on new information or change of unit acreage. Sometimes the resulting negative adjustment is greater than current royalties and the oil company will make the deductions against current royalties until it recoups the overpayment. The alternative would be to ask the royalty owner to send a check refunding the overpayment which most royalty owners do not want to do. Hopefully you overpayment will be recouped in just a couple months. The check detail should show all the adjusting entries when you get back in pay. You can ask the oil company to tell you how much the overpayment was to get an estimate of your estimated time frame.