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Royalties › Postproduction Costs

McGinnis Lochridge

Can "Free of Cost" Term Achieve Point-of-Sale Royalty Base?

McGinnis Lochridge on

A lessee who halts production for less than 40 days and resumes without drilling or reworking does not terminate the lease. The continuous development clause keeps the lease active, and the cessation clause allows resumed...more

Houston Harbaugh, P.C.

Ohio Court of Appeal Addresses Whether Gathering and Transportation Are Separate and Distinct Post-Production Activities

Houston Harbaugh, P.C. on

As we approach the 20th anniversary of the Marcellus Shale play, one issue remains constant: the ongoing debate over the deduction of post-production costs. Landowners all across Pennsylvania have spent countless hours...more

Houston Harbaugh, P.C.

Texas Appellate Court Rules That ‘Free of Cost’ Clause In 1960 Deed Prohibits The Deduction of Post-Production Costs

Houston Harbaugh, P.C. on

Let’s assume you own a 135 acre farm in Tioga County, Pennsylvania. In 2020, you negotiate a new oil and gas lease with XYZ Drilling Company. During the negotiations, you insist on a cost free, no deduction royalty of 17%. ...more

Houston Harbaugh, P.C.

West Virginia Appellate Court Rules That Estate Misconception Theory Did Not Apply To 1902 Deed

Houston Harbaugh, P.C. on

The calculation of production royalties and the deduction of post-production costs remains a troubling issue for Pennsylvania landowners. But there is another frustrating and often confusing royalty-related issue which can,...more

Houston Harbaugh, P.C.

Federal Court In Ohio Rules That Driller Must Establish Marketability of Each Gas Product Under Market Enhancement Clause

Houston Harbaugh, P.C. on

Let’s assume you own 95 acres in Greene County, Pennsylvania. In 2019, you signed an oil and gas lease with ABC Exploration. During the negotiations, you agreed that only those post-production costs which actually...more

Houston Harbaugh, P.C.

Pennsylvania Superior Court Rules that Royalty Clause Referencing Both ‘Gross Proceeds’ and ‘At the Well’ Was Ambiguous

Houston Harbaugh, P.C. on

Let’s assume that you own 125 acres in Tioga County. In 2017, you negotiate a new oil and gas lease with XYZ Drilling. During the negotiations, you insist on a “gross royalty” which prohibits the deduction of...more

Houston Harbaugh, P.C.

Are Your Royalties Going Up in Flames?

Houston Harbaugh, P.C. on

Let’s assume you own 114 acres in Tioga County Pennsylvania. In 2012, you signed an oil and gas lease with XYZ Drilling. Two years later they drill and complete the MUSKIE #1H Well. The royalty clause in the 2012 lease...more

Roetzel & Andress

Ohio Supreme Court Rules in Landowner Royalty Case

Roetzel & Andress on

In a closely watched and long-awaited case with potentially sweeping industry-wide consequences, the Supreme Court of Ohio refused to adopt a default rule regarding deduction of postproduction costs from landowner royalties...more

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