Trinity Operating-Beaver Mountain Wells/Haskell County

[Carl_B_Gillette]

After over a year working with Trinity Operating to own up to acknowledging our mineral interests in the 3 Beaver Mountain wells in 20-8N-20E, all spudded in last two months of 2018, our first distribution mysteriously appeared with their attempt to make up royalty payments. Trinity finally acknowledged their lazy title work and issued the corrective documents in order to get us set up on the pay decks but never sent new division orders. They appear to have unilaterally calculated our royalty interest at some value well below my calculations based upon commonly used formulas for these long lateral gas wells.

So now that they delivered the first pay runs doing the make ups for all the past revenue my first jaw dropping observation is the grossly under-reported volumes listed on the pay runs as compared to the data from OCC data. Secondly and maybe more egregious are the transportation deductions from point of sale…averaging 25-30%. We have a very old lease in force in this section unfortunately from a oil well drilled way back in 1960 which may be the basis from which they’re doing these crazy calculations but we don’t have a copy of that original lease.

Any thoughts or suggestions from members who may have similar issues with Trinity specifically on these Beaver Mountain Wells

[M_Barnes]

The original lease should be filed in the Haskell county courthouse. Or you may be held from an old pooling. Most of those old leases were gross proceeds, so you should push back on the post production costs. Ask Trinity for a copy of the lease or the case number for the pooling order. Ask them how many net acres that are crediting to you. Gas production costs can be very high.

The splits are roughly 50/50, but not exactly. Do you have the final orders from the commission? The completion reports have them at the bottom. Ex. #1 is Sec 29 50.0247% and sec 20 is 49.9753%. Another thing to check is the net acres. The lease often has the gross acres of the parcel on it, not the net.

Do you have any paperwork from the old well? Which one was it?