Gross Proceeds with Market Enhancement Clause in dry gas area vs. wet gas area ?

Why would you want a Gross Proceeds with Market Enhancement Clause in a dry gas area when the gas is ready for market or sale ?  Wouldn't a gross proceeds with market enhancement clause just allow them to take questionable deductions for transportation, marketing, ect. even though it clearly states no deductions as it is already in marketable form? 

 . It is agreed between the Lessor and Lessee that, notwithstanding any language herein to the contrary, all oil, gas or other proceeds accruing to the Lessor under this lease or by state law shall be without deduction, directly or indirectly, for the cost of producing, gathering, storing, separating, treating, dehydrating, compressing, processing, transporting, and marketing the oil, gas and other products produced hereunder to transform the product into marketable form; however, any such costs which result in enhancing the value of the marketable oil, gas or other products to receive a better price may be deducted from Lessor's share of production so long as they are based on Lessee's actual cost of such enhancements.  However, in no event shall Lessor receive a price that is less than, or more than, the price received by Lessee.

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Permalink Reply by KAS on June 3, 2016 at 6:01am

They way it was originally told to us was if your gas is normally sold for $2 as is (raw).... but the company does something to enhance it prior to sale to increase the price to $2.50 then you would share proportionately the 50 cent enhancement cost.  That , however, is not how it is being done.

0ym9x5ag7ury2Permalink Reply by 0ym9x5ag7ury2 on June 3, 2016 at 4:34pm

DR,

      Take the best lease in the Nation, the ALOV, SURE, Williams leases. Read them until you understand there is no way an O&G company can short change a Landowner with one of these leases.

Then go out into the Carroll County and ask the Farmers how they are doing on Royalty Payments.

The answer you'll get is "We aren't getting a Royalty Payment".

How can that be? It's called theft at a level unseen in this nation since it was formed.

Permalink Reply by Frank Walker on June 4, 2016 at 1:02am

Be really wary of any so-called "market enhancement" clause.  Such are a very well recognized artifice used to fleece landowners.  In the immortal words of Admiral Ackbar:

It's a trap!!

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