The December headright checks are not quite in the mail yet, but when they do hit mailboxes, they will reflect an increase in oil field activity from spring.
At the Nov. 18 Osage Minerals Council meeting, the December quarterly headright payment was formally announced at $2,385 per full headright.
That amount is a 40 percent decrease from December 2019. However, it was still welcomed as an increase of $1,015 from September as production continues to rebound from the spring production glut that sent oil prices plummeting and left producers scrambling for storage space.
Since bottoming out in March and April thanks to the ongoing pandemic, oil prices have continued to bounce back. As of Nov. 23, West Texas Intermediate is trading at $43.06 per barrel and the highest posted price for a barrel out of the Osage is $39.75.
“We have seen some increases in the prices prior to September,” Osage Minerals Council Chairman Andrew Yates said. “Prices have held pretty steady around $40 (barrel) lately.
“That’s good news for everyone. For producers, shareholders. As long as we stay at that, we can continue to operate. Would like to see it go a bit so we can see some more activity … but that’s still good news.”
In her monthly report, Osage Agency Superintendent Robin Phillips noted that there is new production activity, including two injection wells from Perdure and one from Short Oil that is producing 25 barrels per day.
Although the increase from September was feted, Councilwoman Susan Forman questioned the actual amount and noted that her calculations based off of the superintendent’s report generated a different projected headright. Forman’s calculations placed the December headright as closer to $2,500.
“If there’s a discrepancy, by all means please send it to me,” Phillips said.