Case Study – ExTex Delivered Ground-Up Services To An Oil And Gas Purchaser

Getting Off To A Good Start 

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Client
Our client is a start-up company that wanted to purchase in New Mexico.

Background
Clients often come to ExTex because they have extensive experience in the oil and gas industry and want to start their own purchasing company. Oftentimes, however, they do not fully understand the burdens, responsibilities, and requirements of becoming a purchaser.

Many start-up oil and gas purchasing companies might know who they are buying from and the agreed upon price, but not much more. In the purchaser world, there are serious payment obligations. Oil and gas purchasers are responsible for maintaining (and sometimes creating) ownership decks. They need to accurately handle title work, as title laws vary from state to state. They need to properly handle suspended payments and unclaimed property for royalty owners. They need to register with each state and obtain a purchaser ID. The list goes on and on – and there are serious consequences for overlooking or doing anything incorrectly.

Challenge
Our client was a startup company, and they wanted to purchase oil and gas in New Mexico. They were unaware that they needed to register all properties with the various state entities. Because there was State Land reporting, they also needed to register with the State Lands Office. In addition to not knowing New Mexico title laws, our client also did not realize that they were responsible for registering for severance tax reporting. 

Solution
ExTex was able to assist in every aspect of these gaps and successfully paid all royalty owners, as well as the state and federal entities, within the first month of the oil and gas purchaser starting out.

Outcome
Our client was able to get off to a good start, knowing that they could focus on purchasing, while we took care of all of their revenue accounting and division order management.

Read Other ExTex Case Studies
ExTex Replaced A Division Order In-House Team
ExTex Gave An Oil And Gas Operator More Control And Flexibility
ExTex Provided Support When An Oil And Gas Operator Acquired A Competitor

For more information about ExTex, or to talk about how we can help your company, please call (303) 463-8799 or fill out our contact form.

ExTex Division Order Services, LLC is located in the Denver metro area (in Golden, Colorado), and we provide back office outsourcing services for oil and gas companies across the U.S. and Canada.