If your Mother bought from Mr Siebert than your 2 acres would have been getting royalty payments from Siebert #1, it should be listed on your statements from Chevron. The Siebert well is just about 29 years old. That is the only oil well that your 2 acres would get royalties from, those old vertical oil wells are 40 acre pools.
The 3 new Chevron wells drilled into the Wolfcamp A are in the same 640 acre pool. You should receive royalties from all 3 wells.
Depending on when you inherited, the only other well to receive royalties from would be Yarbro A Com 1. This was a gas well that pretty much stopped producing in 1999/2000.
The new Chevron wells have not been completed ( Fracked ), possible that they will be completed in Q1 2020, if they start soon. 6 total wells will need to be completed at that location, 3 to the north and 3 to the south so a total of 12 miles of well bore.
If they get a Frack Spread out there by the end of Jan, we might see first production in April/May and then of course a lag for first payments. I have not seen a division order from Chevron yet and probably won’t till Feb/March maybe even later.
I went by there last week and the wells were fenced off, no activity.
I’m hoping someone can advise us on how to get through the layers of Chevron and get a division order analyst to look at our documentation for this same section of Eddy - 15 23s 28e. We inherited working interest in both the E & W/2, and sold the working interest in the E/2. We still have working interest in the W/2, an active well, 320 acre joa, had other offers to participate in the Heritage wells (we chose not to participate, and the joa doesn’t mention losing any rights due to nonparticipation). The depths are covered, but somehow our working interest isn’t showing up in Chevron’s ‘agents’ list. My father was a landman and this working interest is through a lease, the same one that gave us working interest in other wells in that half. We still receive JIB from Chevron for wells in that half, but somehow they don’t recognize our working interest rights. Any advice?
Hi Val.
Thanks for sending your phone number, but I believe that between NMoilboy and CMC15, they have pretty much answered questions that we both have had. We really can’t add to or take away from what they said in their advise. It is nice to have helpful people who are generous with their time and knowledge. Best regards
Thank you so much CMC15. We are so appreciative that you responded with info that really helps gives us more insight. It appears that you are a recipient of this same Section 15.
We actually inherited the minerals and 2 acres from my mother in 1997, but due to an entanglement with my mother’s husband, the checks were held up until 2011. After that the royalty payments came directly to us.
So if you know or have information on the inheritance dates, based on the above dates of inheriting the land and minerals, I would appreciate it, so we are more informed about Yarbro A Com 1 or whatever information we can learn from.
NRI = net revenue interest, or net royalty interest
For me, “participate” means that you have some option on whether or not to be in the wells. Which typically would be for a working interest owner. Someone who has not leased their minerals and has the option to pay for their share of a well and get 100% of the revenue attributed to that interest.
We are going to assume that your minerals were leased to Chevron by your mother. Since you are receiving royalty checks. If you are leased, you have no obligation to pay anything to drill a well, and your revenue is a function of whatever royalty rate is associated with your lease. Which typically means you are getting between 1/8th and 1/4 of the revenue attributed to your minerals (the remainder goes to Chevron, who paid all of the well costs). You don’t have to make any decisions to participate at that point. Yes, you still need to sign a division order on the new wells to get into pay.
If you are nervous, I’d just call the Chevron division order dept and ask them if you should expect division orders for any of the CB wells in Sec 15. But in general, they are paying you for the existing well(s), they will eventually start paying you for the Hz wells.
Ah…you probably only own in the E/2 of Secs 15/22 (where Siebert #1 is located) and thus would not get anything for the wells in the W/2 (the ones that are just now coming online). So, yeah I would not expect anything until nearer EOY 2020.
Thanks again NMoilboy for the clarification on the terms. We have had a quick immersion in the language of the oil business. You’ve been most helpful and also you are correct on the W/2 section of S15 (that we would not get in on those 3 wells, but indeed do in the E/2 Secs 15/22 where Siebert #1 is located. Again, we are most appreciative for your help and knowledge.
Hello again CMC15. As we are Newbies to the the Oil business language and details we have questions that we are trying to understand. As previously stated, we inherited my mother’s two acres from Mr Siebert approximately 10 years ago and still do receive royalty checks from Chevron. (Just a reminder, our 2 acres are in Section 15 T 23s R 28e).
We understand that we are automatically “pooled” into the 640 acre pool. Our question is… “What would the percentage of royalties that participants like us would receive from the 3 new wells in this location once completed”? We have absolutely no idea what the equation for figuring this would be, since royalty terms are rather confusing ie; “royalty interest, NRI, and ORRI”. Hope I am not confusing my question.
We have had an offer of $50,000 for both mineral acres plus $10,000 for our 2 acres of land totally $60,000 for the whole thing. The offer is very tempting, but my wife’s father who owned many mineral acres in several states in ND and MT, always said, “Never sell your minerals”! We surely don’t want to jump into anything quickly.
Our interest is small just having two acres, but with 3 wells, it may be one that we definitely want to hang on to! Would appreciate any information and in put in answer to this question. Thanks Lee
Lee, your offer should be based on a price per net mineral acre (nma) and make the buyer provide information evidencing your interest. If they are only paying you for 2 nma, then only put 2 nma on the deed. If you are going to sell, $25,000/nma is not a bad price for that area. Do you want to share who is making the offer? The only way to know how to get the top price is to get the largest mineral buyers competing against each other. Just remember to take your time and don’t fall for any arbitrary deadlines. Although the interest is small, I am sure it means a lot to you so make sure you carefully weigh all options and don’t jump on the very first offer you get.