Good afternoon! I am happy to find this forum! I have been very frustrated and have two questions as I would like to ensure I am following the appropriate process.
Quick background: I have a Non-Participating Royalty Interest (RI) in Farmington, NM (San Juan County). I own 5% of a batch of four wells that have always produced, and I have only experienced two re-works of the wells and only two operator changes in the past 17 years with both operators very responsive to inquiries. I have been very blessed…until now. Since I have always been “non-participating” it has always been a guessing game as to why a check was late or just never showed up. I just trusted some form of communication would happen and eventually something always came.
Current situation: March of 2023, I didn’t receive a check and still haven’t receive a check to date. I assumed my luck ran out and the wells dried up or a rework was in progress.
January 2024, I called the current operating company (SG Interests, Houston, TX) to give a new address for my tax documents. (I moved in December 2023) It was then, that I was notified by the land ma’am that they sold the interest in February 2023 and that I was responsible to call the new operator and figure out why I haven’t received any checks. I only received a PO Box and name of the company (Petro Mex, LLC.) No phone number or any names.
So, after a day of research, I located three points of contact including the land man and owner of Petro Mex, LLC. I also located five different addresses in Farmington, NM for Petro Mex. I also found public court records showing this new operator has a history of various operating violations including not paying royalties to owners.
After I completed my research, I called the now previous operator (SG Interests) and told them my story and how I never received or read about a Division Order. The land ma’am showed pity on me and gave me a copy of the Assignment/Bill of Sale (from SG Interests to Petro Mex) and the Sundry Reports (seems to be a database with API numbers and such) for the wells. The also were nice enough to tell me Good Luck!
Since that day,
- I have sent multiple emails and left various voicemails with no return phone call or email.
- I have now drafted a “Demand Letter” with citied NM Section 70-10 laws for non-payment of royalties and late payment interest. I also made copies of the Assignment. I plan on sending First Class certified letters to all 5 addresses accept the PO Box course.
My questions are:
- How long do I wait for a response from the certified letter before contacting an attorney?
- Do I also need to contact the NM state royalty auditor? Value added, or no?
Sorry for the novel! It has been a full year and I have never been contacted by anyone affiliated with Petro Mex. I can only assume the worst and am fearful that this outfit has no suspense accounts for myself or other royalty owners.
Thanks in advance.