I would be interested to hear comments 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 would be helpful.
Thank you
I was with Denbury to start with and they sold out to XTO. Haven't had any issues that I am aware of. XtO mails their checks on the 20th of each month. It has only been since January of this year. Not sure if that will be enough to give a 100 per cent thumbs up, but so far so good.
I had a bit of a rough start with Kodiak, they weren't going to send my statutory royalty because I had not returned a division order. When I called them they said they were not going to send my royalty until I informed them that according to ND law, I need not return a division order to get paid. I asked them if they were really going to hold my royalty for that reason and they said, no Sir! and my royalty was on it's way. I am going to have other issues with Kodiak, I'm sure, like deducting what they should not be deducting and other issues. I would give them a D- on their report card. Someone else might give them higher marks, either because they have not had any problems with Kodiak, but then again it may be that they aren't able to recognize when they are being shortchanged. Other than that, Kodiak is fine, except for their poor drilling and completing techniques that will probably leave a lot of oil in the ground. Two of my six Kodiak wells have had problems that have delayed by a year or more getting any significant amount of oil from the wells. I would much rather have say, Statoil as my operator but most of us don't get to pick.
In reading my check stub, it appears that the only deductions are severance tax and another dollar amount that coincides with "compression" My big question is how to determine who buys the oil what determines the price that we are paid. It certainly doesn't compare with the nice price indicated on the market. I have read about a discounted price that is involved....way beyond my comprehensive ability. Is it trucked, is it by pipeline, rail,what refinery does it go to. I'm sure they have someone, someplace and some method of transportation that they use most of the time. I hate having them tell me, basically, that it is none of my business. Is there one of the crude oil price bulletins that comes close to posting a price per barrel that reasonably matches what I receive. I'd like to know if there is a specific day of the month or week when the oil and gas is sold. I just like to know everything, and I feel I don't know much of anything. Talking on this website has been wonderful. Sharing experiences and findings. Priceless.
I am agonizing over the fact that my better well is shut in for completion of 2 new wells. I guess that is the process, but darn I hate to miss out on these good prices. These new wells come of confidential status around Christmas. I don't know if my existing well will be shut in for that duration or not. Wish it wouldn't be but afraid it will be. I hope XTO is a good company to be with, because like you said "most of us don't get to pick".
I have a relative in Norway who is with Statoil there. I guess it is a Norwegian Oil Company. My sister and his wife talk by e-mail, but no talk about the oil industry here in North Dakota. He bobs around in the North Sea.
Deloris, it's all about who buys the oil, our oil is high quality for the most part and would bring a premium if it were closer to a hub but we get the sales price less the cost of transportation. Some buyers pay considerably more for our oil than others.
Deloris, I was in exactly your situation about 2 years ago, oil was selling for $113 per barrel and I had two wells in a good area waiting to be fracked. They were fracked 9 months later when the price was down to $93 a barrel. As good as my wells were, the operator could have easily flowed 100k barrels before the price fell very far, but hey, what's an extra 2 million dollars between friends? My operator was I think running low on money and drilling wells but not completing them because it cost as much to complete a well as it did to drill one and they had spacings they needed held by continuing operations. All of the wells got fracked right after the operator received a $600,000,000 loan. It's a train wreck, you watch it happen and there isn't a thing you can do about it. One of my operators sells my oil for $10-$20 less than my other operators, not a thing you can do about it.
It's a helpless feeling. I love research. I have spent many hours searching for information about the inner workings of oil companies. A person would have to have someone on the inside of every department. The findings would most likely give us a very sickening, sinking peek at the realities of this business. Just have to get up in the morning, bang our head on the wall til we are addled brained enough to not question the fairness of our situation. God knows I am grateful for what I have inherited. But, that is not the point. Plus, being a control freak doesn't help me at being very all accepting, without a question or two.
Good luck with XTO.They are behind in almost everything,especially since the Denbury deal.The amounts of sold oil and gas never match up with the ND website.They are now revising all of the DO's I had with Denbury.
Has anyone ever heard of having 3 Division of Orders on 1 producing well? Is that possible?
I think everyone got overwhelmed......including me!!!
Deloris, I have a pretty good idea of what goes into a well, I have every scrap of paper, interdepartmental e-mails and memos, the deck with title opinion of all mineral owners and lessees and I have read it all twice, it reads like a large city phone book for the most part. Some people think I don't know. Most people would be happier not knowing.
Deloris Bohnsack said:
It's a helpless feeling. I love research. I have spent many hours searching for information about the inner workings of oil companies. A person would have to have someone on the inside of every department. The findings would most likely give us a very sickening, sinking peek at the realities of this business. Just have to get up in the morning, bang our head on the wall til we are addled brained enough to not question the fairness of our situation. God knows I am grateful for what I have inherited. But, that is not the point. Plus, being a control freak doesn't help me at being very all accepting, without a question or two.
I contacted XTO about the discrepancies between them and the NDIC. They told me, in a letter, that they are in the process of amending their procedures to more closely match the monthly statistics on NDIC. The explanation they gave me was not very clear, but it seemed to be different reporting dates. You would think that a company like Exxon Mobile/XTO would have this process down pat. They are not exactly new to the business. I wonder why they are so behind in everything? I would think their pockets would be deep enough to get the job done, no matter what it was. When we were sold by Denbury, I wasn't apprehensive because of the Exxon Mobile brand. I assumed it would be a good thing to have such a big company in the mix. I hope I am not wrong. Exasperated that my best well is shut in with the price of oil at $109 per barrel. Down for 3 to 12 months is a real hit in the pocket book. Hopefully the 2 coming off of confidential in December will compensate enough that it won't hurt so bad. There are not guarantees in the oil business, something to not forget.
Never have heard of 3 division orders for one well. If they are word for word identical, I guess there would be nothing to be concerned about, but I think I would call them and let them explain.
c
Mr Kennedy, this forum would not be much without your input. Thanks again for sharing. Lots of questions but not many to clear them up, who sound credible.
Mr. Kennedy (or anyone else)
Numerous times I have read that according to ND law an oil company cannot withhold royalties before the Division Orders are returned. However I haven't been able to locate anything in the ND Century Code regarding this issue. Could you please tell me exactly where in the Code it is written?
Thanks
NDCC 47-16-39.3 Division orders- Definition, function and operation.
Terry Petersen said:
Mr. Kennedy (or anyone else)
Numerous times I have read that according to ND law an oil company cannot withhold royalties before the Division Orders are returned. However I haven't been able to locate anything in the ND Century Code regarding this issue. Could you please tell me exactly where in the Code it is written?
Thanks
Thanks Mr. Kennedy..that is exactly what I was looking for.
I find it hard to believe that an operator would want to challenge that law as it is clear and concise. I don't think they would want to flex their muscles there, unless they think you couldn't find the applicable law.
Deloris Bohnsack said:
I was with Denbury to start with and they sold out to XTO. Haven't had any issues that I am aware of. XtO mails their checks on the 20th of each month. It has only been since January of this year. Not sure if that will be enough to give a 100 per cent thumbs up, but so far so good.
XTO has been a nightmare for me. Denbury was my highest producing wells. It has been months since the buy out and still no check. They had me jumping through hoops like a trained poodle. Finally I was told they had all the info they needed but "someone" had to sign off of it. It took weeks before they informed me that "someone" had finally signed off on it, but too late for pay out this month. We'll see what happens at the end of October.