I would be interested to hear from people who have Kodiak Oil & Gas or XTO as their well operator.
Did they send a Division Order and if so how long after the well(s) began to produce? Do they pay royalties on time and seem generally okay to work with? Any experiences including leasing would be helpful.
Thank you
I have a mineral lease with them by default. Denbury used to hold my lease & then sold the rights to them. I want to say it was around the 5-6 month mark after production before I saw my first check. You will get a Division Order to sign & return before any funds are released. They don't pay around the same time each month, as it can vary anywhere between the 20th - 26th. You can sign up for direct deposit with them. I can't comment about leasing with them since my agreement was with Denbury. I DO know however, that just this month I got a check from them for oil that was sold in Oct. & Nov. 2010. This revenue check was a separate check from my regular revenue check from them. Some of my family members did NOT receive this separate check, which was quite significant. A family member who didn't receive the check called them to inquire as to where their check was. They were told that it was from funds Denbury forwarded to them on my behave because either they didn't pay me or I never cashed the check. Rest assured if I had received a check, I would've cashed it. I'm glad I got the check, but really don't know if they were just sandbagging my family member or not, nor do I know if the fault truly lies with Denbury or it was a error on the part of XTO. I think you have to watch ALL of the oil companies. My mineral rights in Dunn County are held by 3 different companies, Marathon, XTO & most recently Continental.
Kodiak was late paying me this month.
When I agreed to lease with Kodiak in the beginning they declined to pay the draft twice, went years without paying and then when drilling was imminent, then they wanted my lease which they had recorded and never paid for, told me every untruth in the book, that my lease was still valid, that they didn't have to pay me, offered to pay me 30 times the original amount if I would just sign the ratification and finally released my lease after several months, when I told them my lawyer finally had a block of time in which to start the lawsuit and it was now or never.
I have also caught them doing some things I would consider shifty, and my brother and I agree that we WILL have to audit Kodiak. Other than that, I consider them to be an average operator. As for how well they drill wells and complete them, let's just say that I would rather that Statoil were drilling my wells because fully one third of my wells drilled by Kodiak have needed extensive work right after they were drilled and completed before any appreciable amount of oil was produced from the wells. It wasn't just my brother's and my wells, because I went looking for other examples and I easily found them. Too bad we do not get to pick operators.
I'm still waiting on royalty payments from them on 2 wells that have been producing since August 2013. We are now WELL PAST the 150 days since first sales, where they have to start paying the 18% interest. I've contacted them twice as to when i might expect a Division Order and royalty payments. In both cases, I received a " generic" response, simply telling me that they would make payments anywhere from 5-9 months "after" first oil sales & if necessary would make the interest penalty payments. Like I said, it was a generic response, that really didn't twll me anything.
Remember that the law says they must pay interest on payments more than 150 days past due, whether you ask for it or not, if you have marketable title. So many operators were "pretending" they didn't have to pay the interest when the mineral owner requested it that the law had to be changed.