My mother has 2 mineral interests in Oklahoma. The main one is in Grady County Pocaset, OK. She has another in Washita County. She lives in Texas with me. She has a Texas Trust, but needs to setup an Oklahoma Trust to contain the 2 noted above.
We may want to speak to that same attorney about her Grady County active producing well in Pocaset, OK. In November 2016, Martha Barnes helped me create a pretty good lease with a Oil Company and they sold it to Continental. Later, Continental sold it to Validus Energy around 2024. I am concerned that her production royalties have not followed her lease correctly. Her lease from 2016 has a “No Deductions Clause”. I see from her Continental statements deductions labeled (TRD for Transportation from 11/2022 to 7/2024. Then, Validus Engery took over soon after and I see TRN (Transportation), EXRY1 (Field Fuel), and EXRY2 (Plant Fuel). There may be other deductions. Is it possible Owner Division is not being not being followed per her active lease with “No Deductions clause”? If yes, what steps might be taken?
Can anyone recommend an Oklahoma Oil & Gas Attorney to help?
let me address your first comment. If you have a trust set up, you will need to deed the two mineral interests into the (Texas) Trust. You won’t need a separate trust for the two states.
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A trust is a trust and is good for any state if, it follows the regulations for the states involved. EX: My trust situs is TX, but I now live in AZ, and I have trust holdings in AZ, TX, and OK.
So, you just need to add your Mom’s OK mineral interests to her èxisting trust by changing the ownership to the name of the trust. This is something you can do yourself with Quit claim deeds; You can write them up, get them notarized at your bank, and then send to the County Courthouse (for the county of the mineral interests) with a check for the filing fee. Or, you can hire a TX attorney to do this for you.
As for the production checks, I would start with asking the operators my questions about the ‘No deduction clause’ and whether it is being upheld.
Check the original lease. Just because a clause says it is a “no deductions clause”, it must be read within the context of the whole lease. It may have the “however” or other words in it that undoes it.
And some operators use an industry accounting software that automatically charges post production charges. One must specifically in writing remind the operator of a true “no deductions” lease and demand that no deductions be taken out. That requires a tweak to the software.
No legal advice was given in the past and none at the moment, just suggestions.
You are smart to take care of this now to avoid a probate requirement in the future.
The comments are correct that they can be added to a trust created in a different state, it just has to be done correctly.
If the minerals are in Oklahoma, a Texas attorney cannot prepare the deed unless he/she is licensed there. You can certainly try a DIY approach, I’d estimate that about 60% of the time you’ll guess right. A better option is to have an Oklahoma attorney prepare the deeds for you sign in Texas. That along with an Oklahoma filing compliant memorandum of trust is good to have on file.
Notice: Informational only. No attorney-client relationship is formed by this post. I am an Oklahoma-licensed attorney, but this is not legal advice. Do not share confidential facts in this public space.
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