As a Texas oil and gas attorney, I work with a lot of clients that have financial interests in a well and feel that one of the parties involved is not providing them with accurate information or the full benefit of their royalties. This can be a complicated situation and to get started, I recommend that you set an appointment and bring any contracts you have with you.
Ensuring that your rights are protected in an oil & gas investment or partnership, begins with the contracts that you sign in the first place. While many people prefer to do business on a handshake, this is not how you want to enter this industry. The complex nature of the oil & gas business requires that you establish a firm contract from the beginning so that you can receive the royalties you are entitled to down the road.
In Texas, for example, leases are typically written so that if oil is found on your land and you have a company drill there, you will receive an ongoing royalty based on the oil that is found. Typically the royalties are not diminished by the cost of producing the oil but the post-production costs, transportation, and taxes may be deducted from what is owed. This is where having a contract comes into play. If you don’t have one, your agreement will be interpreted by the court system in a dispute, and this is what they are likely to fall back on. However, if you have a lease drafted from the beginning, we can include specific language that can further protect your rights while outlining the other party’s responsibilities. As an oil and gas attorney, we can help you to draft this agreement prior to allowing anyone to drill on your property or if you are an investor, we can help by drafting investor documents and agreements prior to you putting cash into the deal.
With a contract in place, we can help you to determine if the other party is living up to their end of the bargain. This often involves reviewing financial statements to ensure that the payments you are receiving are the ones that you are entitled to. As an oil and gas attorney, we can review the income statements that they provide you and if there are further questions, we can engage the help of one of our trusted financial experts. A thorough analysis will help us to determine what you should have been paid in comparison to what you were paid. With this information in hand, we can very often negotiate with the other party and reach an agreement without having to go to court. This is preferable simply because it gets you paid faster and will cost you less money in legal fees. If, however, they are unyielding and refusing to negotiate or settle, we can file a civil case in court and seek a court order that would require them to pay you anything owed. To discuss your case further, call and schedule a consultation.