Yes The Trook 1 1-H Larry
I hope your well is as good or better than all the others in the story. Those look like some good wells.
gary - did the Devon lady say why you will be paid for one month now and the back pay next month? I am curious because i just received my 1st check yesterday and it doesnt look like 6 months but its for gas only. I have called them but no return call yet.
Valerie, they told me they are drilling so many wells that they are behind and trying to get caught up. Not sure why they would pay for gas only. I got paid for one month and got paid for gas, NGL (natural gas liquids) and oil (which they labeled as condensate, not sure why?).
Gary, did you get paid for your past months? Which months have you got paid for so far? I got paid for May last month and for April this month. I was just wondering if interest will kick in or what can we expect.
valerie, devon told us they were behind and are now processing jan thru mar. I expect they will pay us in aug. however, I have the same question as you. does okla law require them to pay us interest? does anyone know the answer?
Valerie, I have been paid for the same months that you have been paid for. I have been told that we should be paid for the first 2 1/2 months soon, I assume that means with our next check in August, but who knows. I don’t know exactly what the law is about interest. I was told that they must pay within 6 months, I don’t know if that means if the payment is more than 6 months old they must pay interest. Maybe someone else here could answer that question.
FYI under an act 52 O.S. 1981 section 540 amended in 1984 states that proceeds derived from the production of oil or gas shall be paid to persons legally entitled thereto no later then six months after first sale and thereafter no more then 60 days of the calander month the prouction is sold. As a penalty for this act 12% interest annum calulated from the date of the first sale. Any proceedings for this act must be done in District court of the county of production and the royalty owner maybe entitled to recoving court costs and reasonable attorney’s fees.
I hope this will help and that it has not been amended, if not I have a copy of this six page act dealing with the payment of proceeds from production and well spacing and drilling units and changing certain royalty stipulations.
Here is what the law says, but need an attorney to tell us what it says.
Oklahoma Statutes Citationized
Title 52. Oil and Gas
Chapter 13A - Production Revenue Standards Act
Section 570.10 - Proceeds from Sale of Production
Cite as: 52 O.S. § 570.10 (OSCN 2011)
A. All proceeds from the sale of production shall be regarded as separate and distinct from all other funds of any person receiving or holding the same until such time as such proceeds are paid to the owners legally entitled thereto. Any person holding revenue or proceeds from the sale of production shall hold such revenue or proceeds for the benefit of the owners legally entitled thereto. Nothing in this subsection shall create an express trust.
B. Except as otherwise provided in this section:
1. Proceeds from the sale of oil or gas production from an oil or gas well shall be paid to persons legally entitled thereto:
a. commencing not later than six (6) months after the date of first sale, and
b. thereafter not later than the last day of the second succeeding month after the end of the month within which such production is sold.
2. Notwithstanding paragraph 1 above, royalty proceeds from the sale of gas production from an oil or gas well remitted to the operator pursuant to subsection B of Section 570.4 of this title shall be paid to persons legally entitled thereto:
a. commencing not later than six (6) months after the date of first sale, and
b. thereafter not later than the last day of the third succeeding month after the end of the month within which such production is sold; provided, however, when proceeds are received by the operator in its capacity as a producing owner, the operator may pay the royalty share of such proceeds to the royalty interest owners legally entitled thereto at the same time that it pays the royalty proceeds received from other producing owners for the same production month, but not later than the last day of the third succeeding month after the end of the month within which such production was sold.
3. a. Proceeds from production may be remitted to the persons entitled to such proceeds annually for the twelve (12) months accumulation of proceeds totaling at least Ten Dollars ($10.00) but less than One Hundred Dollars ($100.00). Amounts less than Ten Dollars ($10.00) may be held but shall be remitted when production ceases or by the payor upon relinquishment of payment responsibility.
b. Proceeds totaling less than One Hundred Dollars ($100.00) but more than Twenty-five Dollars ($25.00) shall be remitted monthly if requested by the person entitled to the proceeds. Amounts less than Ten Dollars ($10.00) shall be remitted annually if requested by the person entitled to the proceeds.
c. Before proceeds greater than Twenty-five Dollars ($25.00) may be accumulated, payor shall provide notice to the person owning interest as defined in Section 570.2 of this title, entitled to such proceeds that there is an option to be paid monthly for proceeds greater than Twenty-five Dollars ($25.00). Such notice to the person shall also provide directions for requesting monthly payment, and constitutes notice to all heirs, successors, representatives, and assigns of the person.
4. Any delay in determining the persons legally entitled to proceeds from production caused by unmarketable title shall not affect payments to persons whose title is marketable.
C. 1. A first purchaser that pays or causes to be paid proceeds from production to the producing owner of such production or, at the direction of the producing owner, pays or causes to be paid royalty proceeds from production to:
a. the royalty interest owners legally entitled thereto, or
b. the operator of the well,
shall not thereafter be liable for such proceeds so paid and shall have thereby discharged its duty to pay those proceeds on such production.
2. A working interest owner that pays or causes to be paid royalty proceeds from production to:
a. the royalty interest owners legally entitled thereto, or
b. the operator of the well,
shall not thereafter be liable for such proceeds so paid and shall have thereby discharged its duty to pay those proceeds on such production.
3. An operator that pays or causes to be paid royalty proceeds from production, received by it as operator, to the royalty interest owners legally entitled thereto shall not thereafter be liable for such proceeds so paid and shall have thereby discharged its duty to pay those proceeds on such production.
4. Where royalty proceeds are paid incorrectly as a result of an error or omission, the party whose error or omission caused the incorrect royalty payments shall be liable for the additional royalty proceeds on such production and all resulting costs or damages incurred by the party making the incorrect payment.
D. 1. Except as otherwise provided in paragraph 2 of this subsection, where proceeds from the sale of oil or gas production or some portion of such proceeds are not paid prior to the end of the applicable time periods provided in this section, that portion not timely paid shall earn interest at the rate of twelve percent (12%) per annum to be compounded annually, calculated from the end of the month in which such production is sold until the day paid.
2. a. Where such proceeds are not paid because the title thereto is not marketable, such proceeds shall earn interest at the rate of six percent (6%) per annum to be compounded annually, calculated from the end of the month in which such production was sold until such time as the title to such interest becomes marketable. Marketability of title shall be determined in accordance with the then current title examination standards of the Oklahoma Bar Association.
b. Where marketability has remained uncured for a period of one hundred twenty (120) days from the date payment is due under this section, any person claiming to own the right to receive proceeds which have not been paid because of unmarketable title may require the holder of such proceeds to interplead the proceeds and all accrued interest into court for a determination of the persons legally entitled thereto. Upon payment into court the holder of such proceeds shall be relieved of any further liability for the proper payment of such proceeds and interest thereon.
E. 1. Except as provided in paragraph 2 of this subsection, a first purchaser or holder of proceeds who fails to remit proceeds from the sale of oil or gas production to owners legally entitled thereto within the time limitations set forth in paragraph 1 of subsection B of this section shall be liable to such owners for interest as provided in subsection D of this section on that portion of the proceeds not timely paid. When two or more persons fail to remit within such time limitations, liability for such interest shall be shared by those persons holding said proceeds in proportion to the time each person held such proceeds.
2. When royalty proceeds on gas production are remitted pursuant to subsection B of Section 570.4 of this title:
a. A first purchaser that causes such proceeds to be received by the operator or by a producing owner in the well for distribution to the royalty interest owner legally entitled thereto within the first month following the month in which such production was sold shall not be liable for interest on such proceeds.
b. A producing owner receiving royalty proceeds that causes such proceeds to be received by the royalty interest owner legally entitled thereto or by the operator for distribution to the royalty interest owner legally entitled thereto not later than the end of the first month following the month in which proceeds for such production was received by the producing owner from the purchaser shall not be liable for interest on such proceeds.
c. An operator receiving royalty proceeds that causes such proceeds to be received by the royalty interest owner legally entitled thereto, not later than the end of the first month following the month in which proceeds for such production was received by the operator from the purchaser or producing owner shall not be liable for interest on such proceeds.
d. Liability for interest provided in subsection D of this section shall be borne solely by the person, or persons, failing to remit royalty proceeds within the time limitations set forth in subsection B of this section. When two or more persons fail to remit within such time limitations, liability for such interest shall be shared by such persons in proportion to the time each person held such proceeds.
F. Nothing in this section shall be construed to impair or amend existing or future contractual rights provided for in gas balancing agreements or other written agreements which expressly provide for the taking, sharing, marketing or balancing of gas or the proceeds therefrom. Any proceeds to be paid pursuant to any such agreement shall not commence to earn interest until the sooner of the time provided in such agreement for the payment of such proceeds or ninety (90) days from the date of the depletion of the well. Nothing herein shall be deemed to alter or limit the payment of royalty proceeds as provided in the Production Revenue Standards Act.
G. All payments under the Production Revenue Standards Act to owners or any other person or governmental entity legally entitled to the payment may be made by electronic means including but not limited to electronic funds transfer, Automated Clearing House (ACH), direct deposit, wire transfer, or any other similar form of transfer, upon the mutual written consent of the payor and payee.
Three Rigs all drilling horizontal wells into section 35, T13N, R9W. These three rigs are less than 1/8 mile apart.
Larry and Michael – thanks so much for this helpful information as to McClain 's neighboring (Dewey, Grady, Stephens and Garvin) Counties. I’m hopeful Continental Resources (or someone!) will soon be drilling in McClain, too… Good luck to you gents, as well.
It looks like the oil-rich part of the Anadarko Woodford Play extends into western McClain County. Is anyone aware of any new drilling going on in that area, and, if so, are any production rates known? Thanks!
I believe the Continental well Larry mentioned is the Lambakis 1-11H in the S.E. corner of Grady County. They are reporting 4.2 Million cft. & 110 bopd. My little piece is just across the line In Stephens County. Continental has applied for a pooling order for our section. They also have an “intent to drill” in the township directly north of us in Garvin County.
Not sure but in Continental Resources second Quarter report they had had drilled a well that extended the Cana 25 miles. Our well in Dewey county was mentioned completed at 2.1 millions cubic feet gas per day and and 165 bopd. You can check for drilling permits in McClain County on the Corporation Comm Web site. You can even narrow down to the section. Good Luck Larry
Just joined the group. Being from Chickasha I have an interest in what is going on in Grady County. Own a few mineral acres there. I finished OU in 1958 with a degree in Geology and cut my teeth on the Anadarko Basin. I am still in the business and generate prospects for sale in South Texas. This Woodford Shale development should be very interesting to follow and I appreciate having access to a group such as this. Good luck to all.
Cheryl, if you will click on the discussion above at the top of the discussion list titled “Update on Wells around Calumet” you will find a pdf attachment. That attachment shows the wells around Calumet. If your section is not on that map then you can go to the Oklahoma Corporation Commissions website and search for your minerals using your legal description. Here is a link to that site. http://www.occpermit.com/WellBrowse/
The last time I was out there about 2 weeks ago all three rigs were still drilling in section 35, 13N, 9W.
thank you Gary, I checked out that site, it looks a little complicated for me…not exactly sure how it reads. Glad to hear the 3 rigs are drilling.
I joined the group as I am an out of state mineral rights owner and wanted to keep up with the activity in Canadian County…My attention was caught by the picture posted by Gary of 35/13/9…and the 3 rigs drilling there…is anyone near there and knows the progress? Or anything else going on around there? Thanks
@Andy Lark, I saw on the occ database that Charter Oak Prod. has applied for a pooling order for McClain County Sec 8/6N/4W
Intresting info about about the Woodford. Here is a link to the article and I pasted it below.
http://stocks.investopedia.com/stock-analysis/2011/Woodford-Shales-…
Woodford Shale’s Popularity On The Rise
Posted: Aug 22, 2011 09:52 AM by Eric Fox
The development of the Woodford Shale moved steadily forward during the second quarter of 2011, with most activity focused on areas that have a high content of liquid hydrocarbons. Operators have been busy working to delineate the extent of the play, building infrastructure to handle future production, and trying to determine the down spacing potential of acreage here.
Cana Woodford Delineation
Continental Resources (NYSE:CLR) is focused on the Cana area of the Woodford Shale as wells here produce a significant content of liquids along with the natural gas stream. The company has 270,000 net acres under lease in the Woodford Shale, and estimates that 33% of this leasehold is in the Cana portion of the play.
Continental Resources just reported a number of successful wells in the Cana Woodford Shale, including one well that was 25 miles south of any previous Woodford Shale activity. The company believes that this well proves up an additional 15,000 net acres held by the company.
Continental Resources is operating 13 rigs in the Cana Woodford Shale and has indicated that the play will be a significant area of focus for the company going forward. (Find out how to take advantage of this market without having to open a futures account. For more, see A Guide To Investing In Oil Markets.)
Down Spacing Potential
Cimarex Energy (NYSE:XEC) has 120,000 net acres prospective for the Cana play and has been active here since 2007, drilling 100 net wells to date.
During the second quarter of 2011, Cimarex Energy worked on a pilot project to determine how far down the core area can be down spaced. If the company is correct that the acreage can be developed economically on 80-acre spacing, then it would yield 730 net locations for Cimarex Energy.
Infrastructure Expansion
Devon Energy (NYSE:DVN) has 243,000 net acres under lease in the Cana http://stocks.investopedia.com/stock-analysis/2011/Woodford-Shales-…Woodford and is one of the most aggressive operators in developing acreage here. The company plans to drill 225 wells in 2011, compared to only 87 wells in 2010.
Devon Energy is also expanding the capacity of a natural gas processing plant that serves this area. The Cana gas processing plant was damaged by a tornado in May 2011, and is expected to be operational by the fourth quarter of 2011.
Devon Energy has allocated $125 million to increase capacity at the plant from 200 million to 350 million cubic feet per day. The extra capacity will be complete and operational in the fourth quarter of 2012.
QEP Resources (NYSE:QEP) has been involved with the Woodford Shale and has been adding acreage in the liquids area of this play. The company plans to operate three rigs in this play for the remainder of 2011.
QEP Resources has been working on perfecting the company’s drilling and completion process during the second quarter of 2011, and reported an increase in the estimated ultimate recovery of Cana Woodford wells.
QEP Resources has increased the company’s capital allocation to the Woodford and plans to spend 11% of its 2011 capital budget in this play, up from 7% in 2009.
**The Bottom Line
**The Woodford Shale doesn’t get as much attention in the media as some other unconventional resource plays in the United States, but operators are rapidly increasing development due to the high liquid content of wells here. (For more on oil production and shortfalls, see Peak Oil: What To Do When The Well Runs Dry.)