sections 5-5-6 and 32: can anyone explain why two different companies are going to trial to each drill a 2nd well (Linton1-5-32Xh) Vanguard previously filed Bankruptcy…did the court sell a portion of the leasehold interests to Warwick Jupiter?
Happens quite often. Each firm would like to the option to drill future wells. The issue may be worked out before the court hearings or time will tell as to which company is allowed to drill.
Anyone have an idea what bonus $ per acre is going for around 29-4N-6W? Received an offer, but I would rather wait. Just concerned about the possibility of forced pooling and a lower bonus than what is on the table now.
Thanks for any help!
The offers will be according to royalty. Higher royalty, lower bonus. (Many of us prefer that option). The bonus is not that important. The clauses in the lease are more important as they determine your long term payout and whether or not post production costs are taken out (you do not want that). Most first drafts are not in the mineral owner’s favor and will need negotiation. Forced pooling is my preferred option in some cases-not to be afraid of. The bonus/royalty pairs offered at forced pooling are supposed to be competitive with the leases offered by the operator in the last 12 months.
Lease bonuses are a LOT less than they were a few years back, but considering the downturn in drilling, maybe we shouldn’t be too choosy. I agreed to lease for 700 an acre at 1/8th in 30 and 31 4N 6W in November but still haven’t been paid for it so…
I would suggest that next time you lease, never hand over a lease (or a deed) without getting paid. Did you sign one of those “draft” agreements? The devil is in the details. You may not get paid for months and months…
I have a question regarding HBP. I have an old lease that makes me HBP when a new horizontal well was drilled in 2020 in Grady Co. 9N-5W-24. Since I have not received my 1099 for production from the old well, I found that it had been sold to another company. NO production for 2020 from the old well (from either owner) and no 1099 for 2020. Does this mean I am no longer held by production? How do I inform the Horizonral driller that I am no longer bound by my old lease and wish for a new lease? In 2020 I received payment (and a 1099) from the horizontal well under the terms of the old lease that caused me to be HBP.
Your old lease is still in place. There are 3 wells producing in the unit. The operators are Citizen Energy, EOG Resources and Crawley Petroleum. It sounds like your production is probably in suspense.
Make sure they have your correct contact information and that your current contact information is against the tract indexes in the County Clerk’s office.
Your very first productive well in 1977 made you HBP (Held by Production) from the first day of sales. Does not matter whether it was vertical or horizontal. The terms of the lease will be in place until production ceases for the horizons that were covered in the lease. If it was an old lease, it probably was from just below the surface of the earth to the center of the earth unless you had a depth clause.
If the horizontal well was spud before the vertical well ceased production, then the lease remains in force.
The Buehler Trust 1 was drilled in 1972 and plugged in 1973. 640 acre spacing
The Sprague 1 well was drilled in 1977 and plugged 9/23/2019. This is your Original HBP well. Apache sold the well to Crawley in 1991.
Trumbly 1-24 was drilled in 2001 and was dry. 640 acre spacing. Doesn’t matter since the Sprague 1 was still online. Officially plugged in 2001.
The Sprague 2 was drilled in late 2005 and completed in 2006. The well is spaced at 640 acres and had production through at least Nov 2020 according to the OK tax site. Crawley sold the well to Raw Crude Oil & Gas LLC Nov 2020. The continued production from Sprague 2 kept the lease alive even after Sprague 1 was plugged. Contact them both to see if you have 2020 royalties. If the amounts are less than $10, a 1099 is often not sent. You are looking for the 1073 form on the OCC site.
The horizontal well The Duke 19-9-4 1H was drilled in 2018 by Roan Resources which has been bought by Citizen. It was still online as of November 2020. (The OTC site runs about 4 months behind, so probably still online.) Surface location in 24 and drilled north into section 19. No perforations in 24. Don’t worry about this one.
The Duke 24 13 9 5 1XH was also drilled in 2018 by Roan. Surface location in 24and drilled north through 24 and 13. Spaced at 640 for each section. Roan sold it to Citizen Jan 30, 2020 (accidentally). Transferred back to Roan 9/28/20. However, Citizen Energy III LLC is listed as the Operator on the tax site. Contact Citizen Energy. You are looking for the 1073 form.
Livingston 1324 1H was drilled from section 12 south into 13 and 24 in 2018 and is owned by EOG Resources. It is also online. You can find their address on the 1002 form.
You have had continuous production on the lease since 1977 and the lease is currently in effect.
You may find the addresses of the companies to contact on the OCC well records site. https://imaging.occ.ok.gov/imaging/OGWellRecords.aspx Look up 2409N05W and 1209N05W.
And make sure your contact information is correct as Todd mentioned.
Thank you, Todd. I had hopes but…
Thank you for the thorough background and explanation, Ms. Barnes. You spelled it out for me. Crawley explained that it was sold in Nov. and no need for a 1099. That means it was probably production of under $10 for 2020. Raw Crude said there was no production in December. I will check for the 1073 form on this and the Duke 24 13 9 5. Thank you again for your concise background and explanation. You’ve helped me so many times.
Yes, it’s called the Woodford Stack Scoop play bad wells do 300bbl a day good ones the ip is 750bbl a day or more and a lot of natural gas
I have received from ROAN and EOG a Cause CD No. 201804457 Relief Sought Pooling Order No. 718294. This information confuses me as I thought I was HBP. This seems to offer me the opportunity to participate or I have 3 options to choose from: a bonus of $5250 per acre plus 1/8, $4500 plus 3/16, and $4000 and 1/5. BUT, each option has “provided, however, and provided further” clauses that make it confusing to me. Also, there is no form letter for me to make my choice to mail to both EOG and ROAN. Can you look at this and help me understand the choices I have? Thank you!
This case has been dragging on forever and has been a bit complicated due to companies being bought out, etc.
Participating as a working owner is not for the novice in my opinion. Working interest owners need to have their percentage of deep pockets (and their heirs) as the bills will keep coming until all the wells are plugged decades from now. The revenue may be good or may not. One must also have insurance, good oil and gas attorney and accountants and be able to pay their fees. Some love the challenge. Some do not. WI owners have the liability, simple royalty owners do not.
Most of the “provided further” clauses pertain to a working interest owner or someone who has shared their ownership with an overriding interest owner. Most regular mineral owners are not as concerned with those paragraphs. Many of us take the highest royalty and the lowest bonus since multiple wells at a higher royalty far outweigh a small bonus over many years.
You can write a simple letter back and send it certified mail return receipt - quickly! You only have a few days. Keep a copy of everything you send. Your letter should be addressed to both of the operating companies. Include your name, address, a description of your acreage, the case number, the order number and your section of the option you choose and a signed W-9. For example: “I choose option 6.2iv $4000 per acre Cash Bonus plus a 1/5th total royalty”. I have attached a sample letter where you can fill in the red parts.
Since you are getting a pooling notice, you may have been pooled at shallow depths many years ago or have a depth clause. I always answer a pooling letter quickly so I get the option I want instead of the lowest royalty that they will assign if I do not answer.
0_Pooling order response 2021.docx (13.1 KB)
Thank you so much, Martha. Once again you have helped me by clarifying the document and providing how to communicate effectively with oil and gas companies. Thank you!
Martha, another question as you are very informed…I’m seeing Permits for Linton #2 thru #6 on OKEnergy , sections 32-6-6 & 5-5-6 in Grady and this is confusing. I am unable to find any Permits in the OK or Tulsa court dockets? I am also wanting to find a 1st cousin who needs to go thruProbate to change title from her Grandfather mineral interest if additional wells are permitted. Any information is helpful.
You will not find the permits on the docket list. They can be found on the OCC well records site. https://imaging.occ.ok.gov/imaging/OGWellRecords.aspx. The surface location for 3,4,5,6 is in 29, so put 2906N06W in the legal location box and you will be able to find them. The location for 2 is in 3206N06W. Quite often the surface location is just outside of the section(s) that will be perforated. Linton 1-5-32XH has a surface location in 8-5N-6W.
Your cousin should go ahead and get her probate started. She may have to settle several generations, but that can be done at the same time. Richard Winblad has quite a few posts along that thread. Linton 1-5-32XH has been online since 2014. She may have royalties in suspense with Continental.
Thank you ever so much…hope to meet you at NARO in October. Will be my first time attending!
Look forward to seeing you! It should be a good convention! I think we are all ready for some good education and some networking.
