In this episode we answer listener questions submitted by Ben, Mark, Jennie, and David. This episode was filled with a wide variety of questions from how to value non-operated working interests and how to find a buyer, the differences between different types of oil & gas interests, lease washouts, how to find production data for Oklahoma, and the DIY method to get interests transferred to your name, and more.
Some of the listener questions in this episode are addressed in my Mineral Management Basics online course, from how to read a legal description, how to perform a title search, and how to identify nearby oil and gas activity.
Thanks again to everyone who left a review or who submitted a listener question! If you have a question about your minerals or royalties, you can send it to feedback@mineralrightspodcast.com and who knows we might just answer it on the air!
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Listener Question #1
Hello,
My mother recently passed away and I learned her estate includes a working interest in an oil well, purchased in 1967. All I can tell is that she has been paying a monthly operator’s expense for a long time, but I’m looking for a way to try and value this in order to sell it. So far, I just have the well management company willing to purchase it for a small amount, but I’m curious if it’s worth more. Can you point me to an expert that could help me value this?
Thanks,
Ben
Listener Question #2
Great podcast episode!
A little background on me. My brother and I inherited our dad’s oil & gas investment business when he passed away in 2021 and we’ve been slowly getting a handle on it ever since. I’m working my way through your Mineral Management Basics course now and wish it had been available back when we first got started. Through the course and listening to the washout episode, among other episodes, I had a lightbulb moment. A month ago, if you had asked me what the difference between royalty interest and working interest is, I would have said that royalty interest doesn’t require sharing expenses and working interest does. While that’s true, my lightbulb moment is that the important distinction is that royalty interest originates from the minerals and working interest (along with overriding royalty interest) originates from the lease, and that’s far more important and fundamental than just paying or not paying the expenses. So, thank you for that revelation.
I do have a couple of questions that came out of the washout podcast. We have a working interest in an older well that is nearing the end of its life and is producing less than 10 barrels a month. Production is so low that the operator hasn’t made a revenue payment in over a year, so all we have is expenses – about $80 a month, so not a lot, but it goes on month after month and has for years. I know someone who works for the operator and I asked about plans for that well and the only response I got was that they have no plans for the next quarter. Is it safe to assume that the operator has everyone’s best interest in mind and is using the well to hold the lease until they can do further development nearby? Would we be in danger of a washout situation? If we assign the well back to the operator, could they then turn around and develop the lease in the near future and we’d miss out on any revenue from that?
Thank You,
Mark
Listener Question #3
Hi! I can see the production for our wells on the OK Tax commission site but it only goes back 1 year. So I called OCC – they said OK Tax Commission has the previous records? Neither one seem to have the correct answer. Do you know by chance ?
Thanks! Jennie – Ok
Listener Question #4
Matt,
Hope you’re doing well. You and I met at the NARO in New Orleans. Not sure if you remember me or not. Lots of people there. I visited with you a bit about some mineral interests that were in my grandfather’s name in various counties in CO. I’ve reached out to 3 different attorneys, and they’ve all quoted me thousands of dollars to probate this. You may recall that my father receives around $125/year across all 10 counties; so, my choices now have become to let the minerals go or try and work this myself. I’ve decided to work it myself. I was wondering if you happened to have a mineral deed template you’d be willing to share. If you’re not comfortable with this, I completely understand. Any future relationship we get to have by virtue of our common interest in this space is more important.
I will say it’s been a fun journey so far of learning from my mistakes. After a rather long research exercise and a fairly lengthy paperwork process with notarization, I filed full probate in Lincoln County and around a month later they called me and said I should have filed ancillary probate. My response – hey folks, I researched this and your website said that ancillary probate required an open probate in the state of the decedent – so I figured this wouldn’t work since my grandfather has been deceased for around 60 years. I had a very nice conversation with the clerk and she told me I’d need to reopen probate in the state my grandfather passed in. go figure – it makes perfect sense. Anyway, I’m now visiting with the folks in Union County, AR to determine how to reopen probate for both my grandparents, get my father accepted as personal representative, then get all the necessary paperwork certified to go back to Lincoln County for the ancillary filing. Fortunately, even though I’m performing brain surgery on myself – there’s nothing I can really harm in the process.Best Regards,
David
Resources Mentioned in this Episode:
Mineral Rights Education
- Mineral Management Basics Online Course
- National Association of Royalty Owners
- 1-on-1 Coaching with Matt
Lease Washouts
Books
- Never Split the Difference by former FBI Hostage Negotiator Chris Voss is THE book on negotiation.
How Working Interests are Valued
- MRP 194: How Do You Calculate Mineral Rights Value?
- MRP 154: Oil and Gas Deals and Partnerships
- MRP 7: Working Interests for Mineral Owners
How to Make Sure You are Getting Paid Correctly
- MRP 3: How to Calculate your Net Revenue Interest in 3 Simple Steps
- MRP 97: How to Audit Your Oil and Gas Royalty Statements
- MRP 103: How to Find Out if You Have Unclaimed Royalties
- MRP 166: How to Read and Manage Your Royalty Statements
- MRP 224: What to do About Late Royalty Payments
- MRP 227: How to Find Oil and Gas Info for Oklahoma
How to Negotiate a Lease / Surface Use Agreement
Wastewater Disposal Wells
- MRP 83: Saltwater Disposal Well Agreements
- MRP 144: Solutions to the Orphan Wells Problem
- MRP 151: Types of Underground Injection Wells
- MRP 187: Produced Water Opportunities with Jared Boehs
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