78.54/633.65=.1239485 x .1875=.0232403. BUT the well starts in Section 26 to the north so you don’t get the 100% for section 2. The completion has 54.60%, so .0232403 x .5460135=.0126895.
So a slight discrepancy there from the .01249543 I think you said before.
But we are very close. The three places where the numbers could be off are easy to ask for. The first is which land plat are they using? I used the BLM one, but it is old. The Cimarron River moves, so they may be using a new survey. Ask them how many acres are in sec 2 now. I suspect this is the one since the bottom of the completion order says “irregular section”. I just looked on a newer map and the river has moved quite a bit in section 2, so that might be it.
The second is that the 54.60% might be a planned amount and not the actual if there is a typo. They actually came back with a correction. Sec. 35 is 4208’. I think the second one is right since Sec. 2 stayed the same. The third possibility is that since the river moved, your acreage is slightly less (or more) now than when it was originally deeded. It happens.
There should be the name of a division analyst at the top right of the Division Order (sometimes). That is who you should call and see what numbers they used. Or call their Division Order department. I usually write a letter, put my calculations on it, attach a copy of my mineral deed and ask them to please clarify. Send certified, return receipt so you get a name. Might take a couple of weeks. Don’t sign the division order until you are sure and don’t cash the first check until you are sure. Also make sure it is on the NADOA form with no changes to your lease provisions.
David, Devon has 6 months after the date of the first sale which was June 11, 2014 to make your first royalty production payment. Sometimes, they run a little behind, but you should expect a check around Dec 2014.
David, The DO should arrive before your check, but I do not sign the operators division order. Instead, NARO recommends using this (NADOA) Division Orderhttp://www.nadoa.org/forms/div_ord.pdf** and include this statement:**
THIS INSTRUMENT DOES NOT MODIFY OR AMEND THE TERMS OF ANY OIL AND GAS LEASE. ALL ROYALTIES DUE AND PAYABLE UNDER ANY OIL AND GAS LEASE SHALL BE CALCULATED AND PAID AS PROVIDED IN THE LEASE. THIS DIVISION ORDER IS EXECUTED WITHOUT CONSIDERATION AND MAY BE REVOKED AT ANY TIME.
is the pdf for 17N 2W. I get 633.65 acres since there is the Cimarron River running through section 2.
Then 78.54/633.65=.1239485 x .1875=.0232403. BUT the well starts in Section 26 to the north so you don’t get the 100% for section 2. Check the Division Order. It should have a % on it for just section 2.
Judy The well is a multi unit, so you don’t get the full 100% of the well. Most of my Division Orders like that have xx% section 35, xx% section 2. See if that is on it. Also, make sure it is the NADOA form. You can substitute if it isn’t, but right now, let’s make sure you have the correct Royalty Interest.
Devon finished Meg in 19-19N-3W on June 11, 2014 and we have not seen a DO or any other information from them, should I try an contact them or continue to wait. We are very new to all this.
Some are reporting companies are laying down rigs. Don’t worry, they didn’t lay them down due to lack of future drilling and production. There was a Fed law in 2010 that made them lay down the old dangerous rigs by 2013. http://www.rigzone.com/training/insight.asp?i_id=354
and “as the economies of China, India, and other developing countries grow, their demand for energy and chemical products will rise accordingly, resulting in greater U.S. exports of petroleum and petrochemicals.” http://www.bizjournals.com/prnewswire/press_releases/2014/11/10/DA6…
“Drilling contractors are building a lot of new rigs - expensive, sophisticated, highly productive new-generation rigs that are specifically fit for shale exploration and exploitation. 2015 may set a new record, with new deliveries expected to exceed 150 rigs…at the end of 2011, the U.S. land drilling market had slightly over 400 AC drive rigs. This number will have more than doubled by the end of 2015.”
Linda, Oil futures are averaged hedged at $80 for the next 5 years, because most US shale full cycle (exploration & startups) capital expenditures needs oil at $70-80, but some half cycle (continuation of drilling) can survive with oil as low as $30. DVN is in good debt fee position. SD has big debt, but can continue drilling at very low costs. Buyouts are coming. Companies with little to no debt are in great shape. Feds are keeping rates low until end of 2015 or early 2106, after that rates will rise and banks will lend to the surviving companies.
Several of the oil companies are holding the oil to be sold. I have several wells that I haven’t received an oil check from for a couple of months, but I know the wells are pumping, but oil is being stored. I am still getting my gas checks. This is just another roller coaster in the oil business, that is why you don’t set a budget up using oil/gas checks.
Virginia is right, I’m experiencing the same oil storage no production sale problem, but it could be a short term problem that will correct in less than 2 years. Big US banks are now healthy and have huge stockpiles of cash to complete oil/gas mega deal lendings. This price shake down which is exactly what the banks are hoping for, because the US gov insists it wont’s bale the banks out again and healthy banks lending to healthy companies is the only way to avoid the bale outs. Saudis need oil above $70, because Saudi oil revenues comprises 90 percent of their countries total revenues. Sustained low oil for more than 2 years means Saudis will have to get used to a low level of living and remember, they are spoiled Kings and Princes. Russia and Iran needs oil above $90 - 100 just to produce, not to mention their costs due to lack of infrastructure. Citibank’s 2020 article reports: "All of these details matter because they are shaping the emergence of North America as an energy superpower that is poised to usher in disruptive changes to global oil markets, trade, and investment." https://www.citivelocity.com/citigps/ReportSeries.action?recordId=30&src=Home
Current low oil prices have caused China to increase its oil imports by 50% and it is filling up a strategic reserve. Now, China’s has demand and US has supply. OPEC will have to cut production in order to stabilize the price. Some think OPEC will cut in 2 yrs, others believe sometime in 2015.
For me, 1 plus 1 still euals two, and when I noteice that we are using our own oil in a time when we vowed never to use our own but other nations oil so we would have plenty if our backs were to the Proverable wall, this just does not add up to 3. So, I am still more convinced than ever that what is down under our feet and noses is more crude than we could ever imagine, and the new technology sees this fact, and the 10.000 plus bbd wells will become more abundent in our immediate future. This is why I still say, do not sell your mierals. At any price.