Just got what purports to be a Division Order for the Clara Luper well in 23-26 08/06 .CaminoNatural Resources LLC.
Now, I have signed off on a few DOs but none like this one:
It begins with a provision titled Terms of Sale.
The undersigned will be paid in accordance with The division of interest set out below. (Okay so far).
The Payor (undefined) shall pay all parties at the price agreed to by the operator for the oil, gas and related hydrocarbons to be sold pursuant to this division order. (Actual price paid? Market price?) etc. No royalty rate specified…it is. wrapped up in the decimal interest. (Guess I can back-calculate from the percent perforated an assume 1280 acres total. But no mention of basic lease.)
Blah, blah, blah
Termination. Termination of this agreement (!) is effective etc.
Now, what makes this interesting is that the well previously under lease has not produced for over a year, maybe two or more. So is this a sneaky way to revive the lease?
I have not signed this DO. Might send in a NARO
form after I find out if Camino wants to negotiate a new lease.
Or am I just getting too suspicious in my dotage?
JimB
That document you received sounds very off-putting and weird. I’m like you; I would be very suspicious and I would not sign it. I would be wondering the same as you about a stealth revival of the lease, or worse, a transfer of my royalty interest or my mineral interests.
(My lease form says royalties shall be paid without the necessity of a division order. When DO’s arrive, I make up my own form (using WordPerfect, which I love), based on the NADOA form but omitting the indemnification, and send that in with a cover letter stating what my spouse and I believe we own. . .I use DrillingInfo to look at the survey map for the well to see what percentage of the take points I am under; that allows me to calculate my decimal interest and I usually can come very close to the one on the DO they sent me. Once or twice in the last couple decades I have actually found errors on a DO, in which case I try to alert the sender right away so they can send out corrected DO’s to any others affected.)
Sylvestor, which section are you in? 23 or 26? Which well is your old well? There are several in those sections. I need to check to see the date of last sales versus the spud date of the Clara Luper. Did you have an old lease or were you pooled for the previous well?
Wait on that DO until you get more info. (Also, you do not have to have a DO in OK, but I prefer to have a record of what we agreed to.)
The equation for the decimal is: net acres/actual spacing acres x royalty x % perforations in your section. The splits on the perfs are found in the order after the well has been drilled and surveyed.
Looks like last production was 7/1/20 for the Ellis well. Clara Luper was spud 11/21/21. You might want to check your old lease and see if you have a clause that outlines the Commencement of a well. I would contact the operator and ask under what conditions did they consider that you were actually leased since there was over a year delay. Clara Luper did not have a permit until 10/13/21. My lease says they have to have a well capable of drilling to TD on location and drilling. A permit is insufficient. You might be able to get a higher royalty if you were actually unleased.
Thanks, Martha. I have written an enquiry. Trying to find a copy of the lease. This is an inherited property, leased long before I got it. So, digging into the files.
Seems that the lease should have expired over a year ago unless there is some kind of saving clause.
Jim B
Has been online since February 2022. You can find the details on the OTC site. https://oktap.tax.ok.gov/oktap Go to the HELP area and the PUN lookup. Then type the name in the Lease Name spot. Hit search
