Metropolitan Borough of Oldham

Gateway Royalty Sounds Alarm on Ohio's H.B. No. 152

Retrieved on: 
Tuesday, May 25, 2021

152, if enacted, "would fundamentally alter an unleased mineral owner's options in ways that would greatly benefit the Unit Operator to the detriment of the mineral owner,"says Chris Oldham, Gateway Royalty's president.

Key Points: 
  • 152, if enacted, "would fundamentally alter an unleased mineral owner's options in ways that would greatly benefit the Unit Operator to the detriment of the mineral owner,"says Chris Oldham, Gateway Royalty's president.
  • Based on some of the current operators' cost deductions, a 12.5% royalty under a net lease is the equivalent of a 6.25% royalty interest or less.
  • 152, Oldham says, "removes the ability of an unleased mineral owner to negotiate for a gross proceeds royalty and for a royalty percentage above 12.5%."
  • Oldham says that, for federal tax reporting purposes, Gateway uploads into Integra oil and gas revenue accounting software all 8/8ths information on the monthly royalty statements Gateway receives from each operator on the wells in which Gateway owns a royalty interest.