ROYALTY EXPECTATIONS

It seems to be hard to come up with a confident estimate of the royalty payments I might receive if drilling ever takes place.I own about 50 acres in  northern Washington co. and was wondering if anyone currently receiving payments in southwestern Pa. may help  with any information as per acre payments their receiving.

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Permalink Reply by charles white on August 6, 2011 at 5:53pm
At what rate does the IRS tax bonus money?
Permalink Reply by ray schmidt on August 8, 2011 at 4:11pm
see previous page.finnbear put up a nice post on this.
Permalink Reply by Dave Best on August 4, 2011 at 9:09pm
Can someone explain how this royalty payment thing works?  Do they have to drill on your property to get royalty payments?  Or do you get royalty payments if they drill anywhere on the unit which has to be at least 640 acres of surrounding acreage, right.
Permalink Reply by craig on August 4, 2011 at 10:12pm
Royalty payments are paid to each property owner that is pooled in a declared unit, according to the % acreage of the unit you have, as well as the % of your lease. The size of a unit can vary depending upon the lease, as well as for other reasons. Units can also have multiple wells on them.
Permalink Reply by Jon on August 5, 2011 at 12:37pm
It works like sucking water through a straw. Everything inside the radius goes in evenly.
Permalink Reply by bill h on August 5, 2011 at 9:59pm
Note to self : Don't post when wasted
Permalink Reply by Annien on August 17, 2012 at 2:36pm

I am trying to find out also -if u could let me know

drilled more than a few wells in the area but they are shut in as they are waiting for the pipline. The property is in the super rich area Robinson Twp. Wash Cty -the DEP is reporting on a few wells (Robin Hill/Chevron) that have be around for at least two yrs. which are approx. 4.5 miles away

1365.43 MCF (day) 1.193.3 bbl (184 days) (?)

2548.00 MCF (day) 724.73 bbl (17days)

2394.50 (day)  502.56 bbl(46 days)

The unit (of which will be nego. on mon.)

will be 640 acres +/-

my percentage is 16%

my acres- 10.1

not sure how to figure this one out can you help or direct me to where and what numbers above I use

Please

Thank you

Permalink Reply by Kathleen on August 17, 2012 at 9:01pm
Just to get a day amount couldn't you use the royality calculator on this site? I know it only calculates oil or gas so you would have to be creative with the liquids but maybe it would give you an idea, flawed yes but it's something.
Permalink Reply by Anastasia on August 17, 2012 at 6:38pm

It's extremely important that you understand the nature of royalty payments.  There's no guarantee, ever, how long or how much you can expect to receive.  Something could happen to the well and it could stop producing - the hole could collapse, equipment failure could cause the well to shut down, or whatever production the frac shook loose could simply be exhausted.  In other words, don't spend money that's not in your pocket.  I knew a woman whose mortgage payment was contingent on the royalty check she got each month, and the well was shut in for maintenance for 6 months, and she lost her house (that's the short version of the story).  Flow could be restricted because of price or pipeline capacity.  Just don't assume the checks will always be the same amount, or will come every month.  It could stop at any time. 

 

Permalink Reply by Billy Park Whyde on August 18, 2012 at 8:37am

 Another problem is that there could be legal problems that pop up that can effect a well as well. Unit size might be changed, a EPA challenge due to a incident. My suggestion if you can perhaps get out of debt if any as soon as possible. Stash any above that amount into investments say farm equipment, buildings, perhaps more property but only on a cash paid in full. You will need to consider federal taxes as well you might become a wealthy person that is in the cross hairs of the  O bum a  hunting team. 

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