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Permalink Reply by 2s72s0k9mm8gd on December 25, 2011 at 6:29am

http://www.hh-law.com/News/20111103-Non-ProductionDuringSecondaryTe...

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Permalink Reply by Mike Knapp on December 25, 2011 at 9:22am

Lynn, regarding your thread yesterday, whoever told you that your friends will not receive a royalty is absolutely, 100% WRONG. 

As long as no new wells are drilled, or existing wells are drilled deeper, then the company can continue to pay below a 12.5% royalty.  The second that a new well is drilled, that lease is immediately subject to the "Guaranteed Minimum Royalty Act"

OIL AND GAS LEASES

58 P. S.

 

§ 33.  Guarantee of minimum royalties

 

    A lease or other such agreement conveying the right to remove or recover oil, natural gas or gas of any other designation from lessor to lessee shall not be valid if such lease does not guarantee the lessor at lease one-eighth royalty of all oil, natural gas or gas of other designations removed or recovered from the subject real property.

§ 34.  Escalation of royalties

 

    An oil, natural gas or other designation gas well or oil, natural gas or other designation gas lease which does not provide a one-eighth metered royalty shall be subject to such an escalation when its original state is altered by new drilling, deeper drilling, redrilling, artificial well stimulation, hydraulic fracturing or any other procedure for increased production.  A lease shall not be affected when the well is altered through routine maintenance or cleaning.

I hope this clears up any confusion (or anger) you might have.   Your friends/family will most assuredly be paid their proportionate 12.5% royalty on any Marcellus or Utica gas produced from a unit they are included in. 

Merry Christmas!

Mike

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Permalink Reply by Oil and Gas nightmare on December 25, 2011 at 2:11pm

 Than you Mike, I appreciate that bro  That is what this sight is about HELPING...not insulting people. I am going to bed soon but I have some questions about what you posted.. butI am sleeply now...so tomorrow :) 

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