Texas Supreme Court Takes Care of Big Oil Companies and Not The Texas Mineral/Royalty Owners

Wilson,

I think you would need to request from your lessee the back-up data for the production numbers they are reporting to you, such as the monthly run tickets and/or meter readings for each of the three wells.

Wilson Inc said:

Dear Ben Elmore,

Thank you for responding.

If I get individual well production data for my three tracts from the lease operator where do I go to verify it? Contacting the other 51 tract owners to see if our combined production total matches what is reported to the RRC does not seem very practical.

Thank you,

Wilson

Ben Elmore said:

Wilson, in that situation, the TSC expects you to contact your lessee and get verification from them directly.

Wilson Inc said:

Sorry to take so long to respond. Been unusually busy with the holday. Happy independence day to evereyone!

There is no pooling that I am aware of. In 1937 my great grandparents made a lease on the south 340 acres of a 640 acre section for "one-half interest in minerals...and claim royalty and rentals in that proration." The lease has been held by production since then. I do not know what a community lease is but I see no indication of such on the 1937 lease.

Checking the 'Operator/Wellbore' on the RRC website for any well in the nine sections brings up the identical 'COMPLETION INFORMATION' - same lease name and number. The 'FIELD' is 'FARGO (CONSOLIDATED)'. The wells are so old that checking the 'Well Logs' and 'Drilling Permits' brings up no results except for a rare recompletion. Checking 'Production Data Query' for any well brings up the identical 'Specific Lease Query Results' page which is the combined production from all nine sections.

When I just now for the first time checked the 'Oil/Gas Imaged Records...' I found a Fargo Unit Plat that shows 54 tracts in the 4,959.4 acres of the unit which spans the nine sections. The three tracts reported on my royalty check statement match the location where my interest is on the plat. And there is production data per tract on the statement. The first tract has two producing wells. The second tract has three producing wells but one is reported individually. The third tract has four producing wells but two of the four are reported individually on the statement. I am thinking the individually reported wells have all been recompletions. Anyway, there is no individual well production data at the Railroad Commission to verify my royalty payment.

So, how does the TSC expect me to verify my royalty payment when there are no public records for me to research?

Ben Elmore,

Thank you for your help.

Wilson Inc

Texas Forum Members,

We've got the best Texas Supreme Court Oil Company money can buy. Texas voters remember this when you vote.

Thanks for every ones input on this serious subject.

Clint Liles



Clint Liles said:

Texas Forum Members,

We've got the best Texas Supreme Court Oil Company money can buy. Texas voters remember this when you vote.

Thanks for every ones input on this serious subject.

Clint Liles You are right clint ,, My family has been rippedoffed by CHSP energy for years now and there is absolutely nothing we can do about it. Just another example of the little guy getting screwed by the big corporations. You can vote all you want it wont make any difference. Those days are gone.

If we could get the word out to all mineral owners possibly we could band together for protection but I consider that unlikely. There are too many mineral owners and most probably have no knowledge of leasing or abuses by oil companies. Even if we did band together so many mineral owners would not stay the course, we would fall to divide and conquer. The worst part is that the oil companies beat us with our own money and continue to do so. I don't let myself off the hook for ignorance either, 6 years ago I didn't know a thing about oil and gas and like others I made mistakes before I learned.



r w kennedy said:

If we could get the word out to all mineral owners possibly we could band together for protection but I consider that unlikely. There are too many mineral owners and most probably have no knowledge of leasing or abuses by oil companies. Even if we did band together so many mineral owners would not stay the course, we would fall to divide and conquer. The worst part is that the oil companies beat us with our own money and continue to do so. I don't let myself off the hook for ignorance either, 6 years ago I didn't know a thing about oil and gas and like others I made mistakes before I learned. I know rw we didnt even suspect,, it was very incremental at first, then we noticed the difference between chsp and eog, Eog paid market value every time , but chsp started decreasing by selling to an affiliate at a lower price, now eog pays the market 2dollars and something my last chsp staetment was at .40cents . thats bulls@##t.

Jay,

You describe a situation that falls within the implied covenant to manage and administer the lease, including the duty to market under your oil and gas lease, and potentially falls within the express royalty provision in your lease. In essence, your lessee has the duty to pay market value, and if the lessee makes unreasonable deductions for post-production costs or obtains a lower market price because of an affiliate sale, then the lessee has breached that duty. Not all affiliate sales are a breach of course, because many companies sell to affiliate marketing arms and receive market price. I am seeing your situation with other CHK royalty owners in the Haynesville, Marcellus and the Eagle Ford. There is something you can do about it, but it would probably require going to court. Attorneys will take this type of case on a contingency fee and cover the costs of the litigation. If you lose, the attorney eats all the costs. The attorney only gets paid if he/she recovers for you.



Seth said:

Ben,

We all can appreciate your explanation of benefits, in favor of mineral/royalty owner. Thanks, for assisting the landowner/mineral owner.

Ben Elmore said:

Jay,

You describe a situation that falls within the implied covenant to manage and administer the lease, including the duty to market under your oil and gas lease, and potentially falls within the express royalty provision in your lease. In essence, your lessee has the duty to pay market value, and if the lessee makes unreasonable deductions for post-production costs or obtains a lower market price because of an affiliate sale, then the lessee has breached that duty. Not all affiliate sales are a breach of course, because many companies sell to affiliate marketing arms and receive market price. I am seeing your situation with other CHK royalty owners in the Haynesville, Marcellus and the Eagle Ford. There is something you can do about it, but it would probably require going to court. Attorneys will take this type of case on a contingency fee and cover the costs of the litigation. If you lose, the attorney eats all the costs. The attorney only gets paid if he/she recovers for you. Thanks ben since the price of NG is so low now , it hardly seems worth goin after chp they have all the assests . Me and my family members share these leases. My sister owns many more acres than I do and they are very well off, they really dont need this money. Me on the other hand have only 13 acres, and have been using the royalty money to live off. So its hard for me to convince them to go after cshp. Now with the price low and gettin jipped by chp I am forced to go back to work fixin cars, Im 60 I thought I was retired, but not anymore. Thanks for your concern.



Seth said:

Jay,

Many continue to have the same faith and we cannot expect any attorney to go broke seeking our justice, because of our righting a wrong; but we always short change an attorney who does, by calling him or her a crook because they get millions and take their money off the top.

When one takes all the risk it most of the time equates to them gaining the more, because of taking all the risk from the onset in my opinion. And, we see this all the time in class-action suits, when the lead plaintiff takes the initial complaint and then others ajoin at a later time and the only risk is filing a claim after the initial filing in the court system.

This is not a for or against opinion, but we have participated as landowner/mineral owner alike in the court system for years, whereas even probate has taken approx. 30 years to litigate. The wheels of justice turns very slow when one lacks resources and the most to loose, and even the more. However, the big judgements of one's peers are rewarded and risked because of the appellate process and the defendents are well aware.

So, point is if you expect someone else to take up your cause, then you have further disengaged yourself; but there are opportunities for activism and taking your case forward administratively and/ or finding an advocate who will champion your disadvantages victoriously.

I will not go as far to say that this would be an easy adventure, nor that you will prevail; but it comes down to what is right and just. Unfortunately, many today do not feel the same and they know that the only way to bring things to life is by and through the court system. And, many of us aren't able to enter and fight at that level simply because of a lack of resources and/ or attorney. And, many times the courts will not allow an individual citizen to bring forth a claim without an attorney, or practice law without a license.

So, now we are back to the same point(s) of what is our next step or obvious next step to remain focused and productive citizens. And, many of us leave things undone for the next generation(s), which most of the time continue to a more crowded injustice, whereas there are more divide and chaos. In this instance the O&G company continue to lobby and effect legislation to their advantage by force pooling (MIPA) mineral interest pooling agreement, by and through the Texas Railroad Commission and inadvertly win, by controlling one's interest any way!

So, Jay experience has taught us that the mineral interest trumps landowner interest and your right they got the best lawyers for hire. So be encouraged and continue to share the actual accounts of what has happened and occurring to enligten another; but continue to seek out alternatives to mitigate your circumstance with CHK in my opinion. Ben has been a great source of opinion on this public site, and maybe Buddy Cotten will give you some source opportunity. Continue in the fate.

jay hester said: Thanks seth , those are words of wisdom. You are right. My CHKP statement I got today showed the unit price of .20 cents. I guess next month we will be just giving the NG produced from our wells to chsp. 119.00 from three wells that when they came in were in the top 5 biggest wells in Johnson co tx. I dont even expect a check next month. It's not right what they are doing. But I will continue in faith.



Seth said:

Ben,

We all can appreciate your explanation of benefits, in favor of mineral/royalty owner. Thanks, for assisting the landowner/mineral owner.

Ben Elmore said:

Jay,

You describe a situation that falls within the implied covenant to manage and administer the lease, including the duty to market under your oil and gas lease, and potentially falls within the express royalty provision in your lease. In essence, your lessee has the duty to pay market value, and if the lessee makes unreasonable deductions for post-production costs or obtains a lower market price because of an affiliate sale, then the lessee has breached that duty. Not all affiliate sales are a breach of course, because many companies sell to affiliate marketing arms and receive market price. I am seeing your situation with other CHK royalty owners in the Haynesville, Marcellus and the Eagle Ford. There is something you can do about it, but it would probably require going to court. Attorneys will take this type of case on a contingency fee and cover the costs of the litigation. If you lose, the attorney eats all the costs. The attorney only gets paid if he/she recovers for you. Thanks ben since the price of NG is so low now , it hardly seems worth goin after chp they have all the assests . Me and my family members share these leases. My sister owns many more acres than I do and they are very well off, they really dont need this money. Me on the other hand have only 13 acres, and have been using the royalty money to live off. So its hard for me to convince them to go after cshp. Now with the price low and gettin jipped by chp I am forced to go back to work fixin cars, Im 60 I thought I was retired, but not anymore. Thanks for your concern.

Jay, As I'm sure you know, the unit price CHK reports on their check stub is a net price, so a unit price of .20 cents is just incredible.



jay hester said:



Seth said:

Jay,

Many continue to have the same faith and we cannot expect any attorney to go broke seeking our justice, because of our righting a wrong; but we always short change an attorney who does, by calling him or her a crook because they get millions and take their money off the top.

When one takes all the risk it most of the time equates to them gaining the more, because of taking all the risk from the onset in my opinion. And, we see this all the time in class-action suits, when the lead plaintiff takes the initial complaint and then others ajoin at a later time and the only risk is filing a claim after the initial filing in the court system.

This is not a for or against opinion, but we have participated as landowner/mineral owner alike in the court system for years, whereas even probate has taken approx. 30 years to litigate. The wheels of justice turns very slow when one lacks resources and the most to loose, and even the more. However, the big judgements of one's peers are rewarded and risked because of the appellate process and the defendents are well aware.

So, point is if you expect someone else to take up your cause, then you have further disengaged yourself; but there are opportunities for activism and taking your case forward administratively and/ or finding an advocate who will champion your disadvantages victoriously.

I will not go as far to say that this would be an easy adventure, nor that you will prevail; but it comes down to what is right and just. Unfortunately, many today do not feel the same and they know that the only way to bring things to life is by and through the court system. And, many of us aren't able to enter and fight at that level simply because of a lack of resources and/ or attorney. And, many times the courts will not allow an individual citizen to bring forth a claim without an attorney, or practice law without a license.

So, now we are back to the same point(s) of what is our next step or obvious next step to remain focused and productive citizens. And, many of us leave things undone for the next generation(s), which most of the time continue to a more crowded injustice, whereas there are more divide and chaos. In this instance the O&G company continue to lobby and effect legislation to their advantage by force pooling (MIPA) mineral interest pooling agreement, by and through the Texas Railroad Commission and inadvertly win, by controlling one's interest any way!

So, Jay experience has taught us that the mineral interest trumps landowner interest and your right they got the best lawyers for hire. So be encouraged and continue to share the actual accounts of what has happened and occurring to enligten another; but continue to seek out alternatives to mitigate your circumstance with CHK in my opinion. Ben has been a great source of opinion on this public site, and maybe Buddy Cotten will give you some source opportunity. Continue in the fate.

jay hester said: Thanks seth , those are words of wisdom. You are right. My CHKP statement I got today showed the unit price of .20 cents. I guess next month we will be just giving the NG produced from our wells to chsp. 119.00 from three wells that when they came in were in the top 5 biggest wells in Johnson co tx. I dont even expect a check next month. It's not right what they are doing. But I will continue in faith.



Seth said:

Ben,

We all can appreciate your explanation of benefits, in favor of mineral/royalty owner. Thanks, for assisting the landowner/mineral owner.

Ben Elmore said:

Jay,

You describe a situation that falls within the implied covenant to manage and administer the lease, including the duty to market under your oil and gas lease, and potentially falls within the express royalty provision in your lease. In essence, your lessee has the duty to pay market value, and if the lessee makes unreasonable deductions for post-production costs or obtains a lower market price because of an affiliate sale, then the lessee has breached that duty. Not all affiliate sales are a breach of course, because many companies sell to affiliate marketing arms and receive market price. I am seeing your situation with other CHK royalty owners in the Haynesville, Marcellus and the Eagle Ford. There is something you can do about it, but it would probably require going to court. Attorneys will take this type of case on a contingency fee and cover the costs of the litigation. If you lose, the attorney eats all the costs. The attorney only gets paid if he/she recovers for you. Thanks ben since the price of NG is so low now , it hardly seems worth goin after chp they have all the assests . Me and my family members share these leases. My sister owns many more acres than I do and they are very well off, they really dont need this money. Me on the other hand have only 13 acres, and have been using the royalty money to live off. So its hard for me to convince them to go after cshp. Now with the price low and gettin jipped by chp I am forced to go back to work fixin cars, Im 60 I thought I was retired, but not anymore. Thanks for your concern.



Ben Elmore said:

Jay, As I'm sure you know, the unit price CHK reports on their check stub is a net price, so a unit price of .20 cents is just incredible. Yes Ben, I guess next month we will just give CHP the NG our wells produce. Then after that I suppose they will charge us, and we will have to pay them. I dont see how they can be so "in your face" dishonest.



jay hester said:



Seth said:

Jay,

Many continue to have the same faith and we cannot expect any attorney to go broke seeking our justice, because of our righting a wrong; but we always short change an attorney who does, by calling him or her a crook because they get millions and take their money off the top.

When one takes all the risk it most of the time equates to them gaining the more, because of taking all the risk from the onset in my opinion. And, we see this all the time in class-action suits, when the lead plaintiff takes the initial complaint and then others ajoin at a later time and the only risk is filing a claim after the initial filing in the court system.

This is not a for or against opinion, but we have participated as landowner/mineral owner alike in the court system for years, whereas even probate has taken approx. 30 years to litigate. The wheels of justice turns very slow when one lacks resources and the most to loose, and even the more. However, the big judgements of one's peers are rewarded and risked because of the appellate process and the defendents are well aware.

So, point is if you expect someone else to take up your cause, then you have further disengaged yourself; but there are opportunities for activism and taking your case forward administratively and/ or finding an advocate who will champion your disadvantages victoriously.

I will not go as far to say that this would be an easy adventure, nor that you will prevail; but it comes down to what is right and just. Unfortunately, many today do not feel the same and they know that the only way to bring things to life is by and through the court system. And, many of us aren't able to enter and fight at that level simply because of a lack of resources and/ or attorney. And, many times the courts will not allow an individual citizen to bring forth a claim without an attorney, or practice law without a license.

So, now we are back to the same point(s) of what is our next step or obvious next step to remain focused and productive citizens. And, many of us leave things undone for the next generation(s), which most of the time continue to a more crowded injustice, whereas there are more divide and chaos. In this instance the O&G company continue to lobby and effect legislation to their advantage by force pooling (MIPA) mineral interest pooling agreement, by and through the Texas Railroad Commission and inadvertly win, by controlling one's interest any way!

So, Jay experience has taught us that the mineral interest trumps landowner interest and your right they got the best lawyers for hire. So be encouraged and continue to share the actual accounts of what has happened and occurring to enligten another; but continue to seek out alternatives to mitigate your circumstance with CHK in my opinion. Ben has been a great source of opinion on this public site, and maybe Buddy Cotten will give you some source opportunity. Continue in the fate.

jay hester said: Thanks seth , those are words of wisdom. You are right. My CHKP statement I got today showed the unit price of .20 cents. I guess next month we will be just giving the NG produced from our wells to chsp. 119.00 from three wells that when they came in were in the top 5 biggest wells in Johnson co tx. I dont even expect a check next month. It's not right what they are doing. But I will continue in faith.



Seth said:

Ben,

We all can appreciate your explanation of benefits, in favor of mineral/royalty owner. Thanks, for assisting the landowner/mineral owner.

Ben Elmore said:

Jay,

You describe a situation that falls within the implied covenant to manage and administer the lease, including the duty to market under your oil and gas lease, and potentially falls within the express royalty provision in your lease. In essence, your lessee has the duty to pay market value, and if the lessee makes unreasonable deductions for post-production costs or obtains a lower market price because of an affiliate sale, then the lessee has breached that duty. Not all affiliate sales are a breach of course, because many companies sell to affiliate marketing arms and receive market price. I am seeing your situation with other CHK royalty owners in the Haynesville, Marcellus and the Eagle Ford. There is something you can do about it, but it would probably require going to court. Attorneys will take this type of case on a contingency fee and cover the costs of the litigation. If you lose, the attorney eats all the costs. The attorney only gets paid if he/she recovers for you. Thanks ben since the price of NG is so low now , it hardly seems worth goin after chp they have all the assests . Me and my family members share these leases. My sister owns many more acres than I do and they are very well off, they really dont need this money. Me on the other hand have only 13 acres, and have been using the royalty money to live off. So its hard for me to convince them to go after cshp. Now with the price low and gettin jipped by chp I am forced to go back to work fixin cars, Im 60 I thought I was retired, but not anymore. Thanks for your concern.

Dear Ben,

I have a client in S. TX where the same is happening to them with CHK. I gave them your info. There is probably the ability to act as a class in this case.

Potentially, though class cases in Texas are very difficult nowadays. And that would also be the work of our TSC. Thanks Buddy, I'll let you know if they call.

buddy a class action has been tried in oklahoma on behalf of the owners in the barnet shale, nothing came of it . A class action suit wont stand because cshp worded each lease a little different. they got us by the short hairs.



Buddy Cotten said:

Dear Ben,

I have a client in S. TX where the same is happening to them with CHK. I gave them your info. There is probably the ability to act as a class in this case.

Best,

Buddy Cotten

You can still get a group together and join in one suit. In that case, it would not matter if you had different lease forms.

jay hester said:

buddy a class action has been tried in oklahoma on behalf of the owners in the barnet shale, nothing came of it . A class action suit wont stand because cshp worded each lease a little different. they got us by the short hairs.



Buddy Cotten said:

Dear Ben,

I have a client in S. TX where the same is happening to them with CHK. I gave them your info. There is probably the ability to act as a class in this case.

Best,

Buddy Cotten

Dear Jay,

There has been so many CHK suits, which one is it to which you are referring? Can you provide a citation so that I can look it up?


jay hester said:

buddy a class action has been tried in oklahoma on behalf of the owners in the barnet shale, nothing came of it . A class action suit wont stand because cshp worded each lease a little different. they got us by the short hairs.



Buddy Cotten said:

Dear Ben,

I have a client in S. TX where the same is happening to them with CHK. I gave them your info. There is probably the ability to act as a class in this case.

Best,

Buddy Cotten



Buddy Cotten said:

Dear Jay,

There has been so many CHK suits, which one is it to which you are referring? Can you provide a citation so that I can look it up?

Best,

Buddy Cotten

Mineral Manager

jay hester said:

buddy a class action has been tried in oklahoma on behalf of the owners in the barnet shale, nothing came of it . A class action suit wont stand because cshp worded each lease a little different. they got us by the short hairs.



Buddy Cotten said:

Dear Ben,

I have a client in S. TX where the same is happening to them with CHK. I gave them your info. There is probably the ability to act as a class in this case.

Best,

Buddy Cotten

Buddy the class action suit I was referring to was Coffey vs Cheasapeake It was filed in oklahoma on behalf on people in the Barnet shale. Nothing came of it tho, It was filed one day then voluntarily withdrawn a couple days later. The suit claimed chp violated the covanant by selling to an affliante at a low price thus under payment of royalties.