LOE expenses very high this month? Did you foot the bill for Hilcorp’s huge payroll bonus? Two months ago Hilcorp paid each of their employees $75K for their latest 5yr mega bonus (although in reality they extended it to 6 years after the set goals were not met, but it doesnt sound like any wi owners approved of the change to 6 years.) I questioned the charge and was told owners had a right to audit if they disagree. (After the expenses are paid of course).
This charge is on the 12/21 expenses (received this month) the working interest owners were billed for the bonuses paid to the field employees. Legit in my book since copas allows for bonuses as long as they are documented, non-retractible and the details are distributed to the employees Before the bonus period begins. I then asked more questions. The original 5 year bonus plan was suppose to end with 12/2020 production however since prices were so low no bonus would have been paid per the plan’s original stated goals. Hilcorp then changed the plan at the end of year 5 to 6 years in hopes of eventually meeting the goals (which it did) but it doesnt sound like any joint owners approved of this change. Please speak up if you did. I requested documentation of approval along with a copy of the original bonus details which is likely what all wi owners will have to do that want to dispute this. DH