Addendum?
I just received an addendum from Cabot & while reviewing the form, I think the oil company is trying to pull a fast one on me. One of my concerns was my percentage of royalties would be from the gross at the well head.
Below is how the addendum is worded:
1. Lessor’s royalties shall be free & clear of all cost, claims and expenses, including, but not limited to, the costs of gathering, transporting, separating, dehydrating, treating, compressing, or otherwise making the oil or gas ready for sale or use. Lessor’s royalty shall bear its proportionate part of all ad valorem, severance, gross production, gathering and other similar taxes levied on or measured by production from premise.
Another one of the Addendums that I don’t like the wording is regards to “Free Gas” it reads:
2. In the event that Lessee is making gas from a well actually located upon the premise, then in lieu of Free gas to Lessor, Lessee shall pay to lessor for each one year period…etc.
I think the way this worded in bold is if I’m in a UNIT, I would not be entitled to any payment because the well would not be on my property. Is this correct?