Unresponsive Company

So we have a lease management company that has gone completely unresponsive. My sibling has a much smaller portion than I, and they have received no payment in over a year, even though the company states that they will pay out annually on portions less than $100 a month. They got the “down payment”, but nothing since. I believe it’s been 2 years for him with no money. My monthly payments are spotty and I still go months without a payment at all, even with oil prices being so high. I don’t necessarily believe my payments are right, either, as I was making more when oil was much less per barrel than it currently is.

My step-mother, who held a life estate right to a portion that was passed from my dad, has passed away. I’ve asked for the adjustments to be processed so that her percentage comes back to us like it is supposed to. I also have considered selling my portion outright, but wanted a current offer, as the last time that we had any offers were a few years ago. Best to my knowledge, there are at least 2 active wells on the property with permits for several others.

I have made multiple phone calls and sent multiple emails to several people at this leasing company. It’s been 6 weeks+ now with no response to any attempted inquiries. I don’t think it is unreasonable to expect some sort of response, especially since my step-mother’s portion needs to be added back to our portions so the percentage are correct.

What are my recourses? Who else can I call? Is there a complaint system set up somewhere if we are having problems? Thanks for your help.

We can answer better if we know which state.

Just so we’re clear on parties, etc. An exploration company (frequently called and e&P company) will hire a leasing company to secure oil and gas leases. After the leases are secured, then the leasing company, or lease brokers, field landman, typically, has no further responsibility in the project.

In your question, you reference a lease management company and the leasing company. Is this the company who secured the lease from your family, or is this the company who drilled and operates the well? If the company you’re calling is not the operator, then it is not unusual that you are not getting any responses. In short, you want to make sure you are calling the right company.

First, it is TX, Midland area.

Second, yes, there was a landman involved and he actually stayed involved longer than we figured he should have, but he was more responsive overall. I was kind of surprised that he seemed to be the “contact guy” well after the lease was signed and done. It made it unclear (to us) what his role actuall was in this company.

The short answer is that we’ve attempted contact with both. There is a company that we signed the lease with and then there is the entity that makes the payments. They are associated with each other, according to their webpage.

Just to complicate things further, I sadly found out last night that my brother is also now deceased. I assume that changes things again… not that I am in any place to figure out how, right now.

Regardless, there has yet to be responses from anyone and we’ve now written all 3 known entities… and again, no payment again this month. How is that possible with the prices as high as they’ve been?

Also, are we really just stuck with them for life? The lease, I assume, must automatically renew, because it was originally a 3 year deal and it’s been over 5 years since I signed a thing.

At this point, I might be willing to sell the whole thing and wash my hands with it, because it has been exceedingly difficult to get answers about anything and I’ve not completely trusted these folks from day one. A lot of fast talk, a lot of pressure. Now, nothing.

First of all, condolences. It will take some time to figure all of this out.

There can be several reasons for “no payments”.

If the Division Order said that the minimum is $100, then the royalties have to build up to that amount before they will cut a check. That can be changed to $25 for more regular checks.

The well might have been shut in for fracking operation nearby. Hopefully, no damage has been done and the well will come back online after they are finished. There may be a one-three month delay in payments since that is how long it takes to sell the oil and gas and remit payment once they start the well back up.

The well might be finished. We would need more information to help you find out about a particular well.

The well could have been sold which can cause a delay in payments while all of the due diligence is done on the sale.

The lease is for as long as the well(s) are productive. The lease has a primary term (usually three years) and once the well is online, it moves into the secondary term which can last decades.

Contact the operator who was making the payments by certified letter return receipt. Include you name, owner number, name of the well or lease that is on the check stub. Texas law requires them to answer certified letters within a certain time frame.

Thank you for that information, because we are almost another week out with yet another email sent to another party and nothing. We feel ghosted by this company. I am sure it will ultimately be up to my brother’s widow to collect, as I assume his portion is hers now… which is absolutely fine. I am doubting that is going to be on her priority list anytime soon, especially since he’s already gone 2 years without a payment, even when we were receiving ours… so it is not that the well was not producing. While his percentage is small, even an annual payment should have come at some point.

From the get go, they really messed all this up. This was originally marital property from a divorce back in the 1980’s. They did not ask about previous marriages, assumed that dad’s widow was rightful heir to her part of his percent and she sold hers outright early on… when it was not calculated properly, because he owned half and his ex wife (aka mom) the other. I just don’t know if there is enough meat on this bone to warrant an attorney. It is frustrating.

If we decided to sell our rights outright, does it have to be to this company? Or can others purchase it from us and then collect it like we do? There was a time where we would get regular offers in the mail, even after it was leased, but we never followed up on them because it seemed like we wanted to keep them at that time. At least point, it seems to be more headache than help and I think we are done.