Oil and natural gas industry is one of the largest industries in the world with great revenues. However with great revenues come immense costs too. Among those costs are finding and producing oil and natural gas, refining, distributing and marketing those refined products. Today’s oil and natural gas industry earnings are invested in new technology, new production and environment and product quality improvements to meet tomorrow’s energy needs. The industry’s earnings are very much in line with other industries, and often they are lower. One of the most significant cost drivers is the royalty that companies have to pay to the land owners. The royalty that is the payment made for the use of the land for extracting oil and gas may vary due to the different market rates that prevail in different locations.
While this may seem like a complex matter at first, you will soon realize that it is not as complex as you may have imagined. For instance, newer leases in high-demand areas like Texas’ Barnett Shale or the Heynesville Shale can earn higher royalties than older leases in the same regions. The value of the land itself, along with several other factors determines the price of a royalty. This royalty does not have a fixed rate and hence companies may wish to eliminate this variable cost to obtain a higher profit margin. Since these royalties add to the miner’s cost, they look for loop holes to minimize this royalty cost. It is not uncommon for oil and gas companies to try to find ways to reduce the oil and gas royalty payment expense by under reporting production, overstating post-production expenses, and any other mean that they may find to window dress their operations.
As a land owner, getting paid for the land’s consumption is your right. Since, there is no fixed royalty rate, and miners are driven to find ways to cut back the royalty expense. A good attorney can help you make sure that your rights as a land owner are being protected. If such a situation arises, the strong expertise of a litigation attorney can bring together the resources and help you make a strong case against the mining company. You can claim the royalties that you are owed, and ensure that your rights are kept protected. Such efforts have been recognized and is appreciated nationwide for their abilities and expertise in providing high quality legal representation to clients in complex commercial and business lawsuit matters. A competent lawyer will understand that every company has unique legal rights, and thus they aim to provide you quality service on a personal level by understanding the depth of your case. They also understand that dealing with legal matters can be complex, but they ensure that you do not go about it alone. Thus, if you are involved in a dispute over unpaid oil and gas royalties due to any cause that denies you the payment of the royalty that you deserve, the oil and gas attorneys can explain to you your options and fight to protect your rights in court if it leads to that.
For more information about Watson Law Firm’s Oil and Gas and Mineral Rights legal services, Oil & Gas/Mineral Rights