Long story short:
My grandffather drilled and operated a well in Pecos County and Hunt Oil and the operators of various leases unitized their leases into the Pecos Valley 5400 Devonian Unit.
For many years we have been paying JIB (working interest) on the unit and receiving revenue from the unit. Hunt Oil is the operator. There have been several other companies that have been issueing the revenue checks, but most lately it was Samson and currently Enduro.
Enduro paid on the unit production for a month or two and then sent a letter that they were going to pay by the track which has reduced our revenue by about 50%.
We are still paying the WI on the entire Unit.
I have the Joint Operating Agreement from the 50's or 60's and it appears to me that once you are in a unit you share in the unit costs and revenue.
Has anyone heard of this before? Does anyone have a name for an attorney in Pecos County, Midland or Ector County?
Thanks Mike
Mike,
Your unit life may be coming to an end and wells have been plugged and the unit contracted. Just a guess.
Harold Hensley in Midland is a highly experienced and knowledgeable mineral attorney with the Hinkle Hensley law firm. I highly recommend him and the firm.
This is something that I have been curious about as well. I have experienced almost the same situation recently with some working interest, but it is also something that I wonder about with royalty interest in a producing unit.
Sir, you may be absolutely correct; and there have been wells plugged and new ones drilled etc.etc. However, Enduro bought part of the unit from Samson and they say they are only getting paid for their tracts and that is how they are now going pay other WI owners that are in their tract.
Once again, my real question is: If we were part of a unit (all for one and one for all as per our revenue interest and net acreage); doesn't someone need to be paying the balance of the unit revenue if Enduro is only paying for their tracts of the unit they purchased?
If Enduro, by purchasing some of the unit obtained our WI, why are we still being billed for the entire unit as we always have been? When I call Hunt they said to talk with Samson. When I called Samson they said to talk with Hunt. Now that Enduro is in it, I think getting answers from them is going to be even harder.
I don't suspect there is an easy answer for this but I was hoping someone had a similar situation and they might be hable to explain it without me having to hire an attorney.
Gary L. Hutchinson said:
Mike,
Your unit life may be coming to an end and wells have been plugged and the unit contracted. Just a guess.
Harold Hensley in Midland is a highly experienced and knowledgeable mineral attorney with the Hinkle Hensley law firm. I highly recommend him and the firm.
Gary L Hutchinson
Minerals Management