North Las Vegas, NV asked in Energy, Oil and Gas for Texas

Q: Is it legal for an oil company to take your entire revenue check (which is our sole income) with no warning?

Two years ago we, as royalty owners with Pioneer Natural Resources, sold a percent of our mineral interest in Upton County to OneMap Mineral Services LLC. All Division Orders were signed by all parties and money exchanged hands. But apparently Pioneer dropped the ball and mishandled some of the paperwork, resulting in a slight overpayment each month for over two years. Upon discovering this error on their part, Pioneer stopped all revenue checks to recoup the money. With no notice from them, the checks, that are our sole income, immediately stopped. Having recently started a new business to diversify our income, we have no savings left. We're now without food and can't pay our rent, utilities, car payment, insurance or any other bills. Our 12 yr old son had to go without celebrating his birthday and there will be no Christmas. We will most likely be evicted for lack of payment. Pioneer can make an exception to taking all the revenue and instead arrange payments to take the burden of th

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1 Lawyer Answer
Aimee Hess
Aimee Hess
PREMIUM
Answered
  • Energy, Oil & Gas Law Lawyer
  • Streetman, TX
  • Licensed in Texas

A: This is certainly an unfortunate situation. Whether or not Pioneer is allowed to withhold all royalty due to you depends on the language of the most recent division order for these royalties that you signed, as well as the terms of the oil and gas lease that you or your predecessor in interest signed. In order to determine your rights, you need to have an experienced oil and gas attorney look at these documents and also check current court decisions to see what the Texas courts have said about the situation. Finally, in my experience, some oil companies will agree to modify the withholding amount and stretch out the withholding period over time where it creates a severe hardship such as in your case.

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