Category: 2024

Valor’s Director of Business Development, Aaron Calhoun, addresses the top 5 questions he gets asked most offten by prospective mineral management clients

Our team frequently receives questions from prospective clients who are seeking expert support in managing their mineral assets. These inquiries cover a wide range of topics, from understanding mineral rights ownership to maximizing revenue and ensuring compliance with legal and regulatory requirements. Recognizing the importance of these concerns, we’ve dedicated this blog to addressing these questions head-on. Our aim is to provide clear, insightful answers that not only help demystify the complexities of mineral rights management but also illustrate how our services can offer valuable support. Whether you’re new to mineral ownership or looking to optimize the management of your assets, this blog is designed to answer your top questions.

1. Will Valor ensure I am being paid correctly on my mineral assets?

Answer: Yes. At Valor, ensuring you are being paid correctly on your mineral assets is a fundamental part of our service. We conduct thorough royalty audits and closely monitor payment statements from operators to verify that you receive every dollar you are entitled to. Our proprietary mineral management software, mineral.tech®, allows us to run pay status reports and discover missing payments. Our team also cross-references production reports, sales data, and lease agreement terms to ensure accuracy in royalty calculations and payments. If discrepancies are found, we take immediate action to rectify them on your behalf. Additionally, our team stays informed on market trends and legal changes that could affect your revenue, ensuring that your payments reflect the current value of your assets. Our proactive approach and attention to detail mean you can have peace of mind knowing that your mineral assets are being managed diligently and profitably.

2. Can Valor help increase the revenue from my mineral rights?

Answer: Valor leverages extensive industry knowledge and relationships, market intelligence, proprietary mineral management software and strategic negotiation skills to secure the most favorable lease terms and royalty rates for our clients. By actively managing leases, monitoring market trends, and advocating for your interests, we aim to increase revenue from your mineral rights. Additionally, our expertise in legal and regulatory compliance can help avoid costly penalties and ensure that your assets are managed efficiently. Lastly, while our team might not “increase” your revenue, we often recover suspended funds that mineral owners are unaware of. These discoveries can help mineral owners gain access to money that is rightfully theirs.

3. Can I still be involved in decision-making if I outsource the management of my mineral rights to Valor?

Answer: Of course. We always consult with our clients before proceeding with any decisions regarding their assets. Our goal is to manage and optimize day-to-day operations and work with you as much or as little as you desire. We believe in maintaining an open line of communication and ensuring that you are fully informed about and comfortable with the decisions being made about your mineral rights. Your involvement in the decision-making process is crucial to us, as it helps ensure that our actions align with your goals and expectations.

4. What access will I have to my revenue and land records?

Answer: Our proprietary mineral management software, mineral.tech®, provides our clients with comprehensive access to their revenue and land records. This innovative platform allows you to see all your land assets accurately mapped and offers digital access to any corresponding documents, such as deeds, lease agreements, and royalty statements. Furthermore, you can track your revenue down to the well, product, county, state, and payor. This level of detail and transparency ensures that you have a clear and complete understanding of your mineral rights portfolio and its performance at all times.

5. What is Valor’s fee structure for mineral rights management?

Answer: Fees for mineral management vary on the scope of work (SOW) and services requested by prospective clients. Our team prepares personalized quotes for onboarding and monthly management. For example, a client who utilizes our land management, mineral.tech® software, accounting, scanning and mail services will likely have a higher fee than a client who utilizes us solely for mineral management accounting. Valor’s fees are not based on a percentage of gross revenue that our clients make.  Our estimates, quotes and ultimately our monthly invoice is billed by the hour for the work performed. Unlike other mineral management companies, we do not make a percentage of money off your revenue. Our goal is to bring value to your assets through our proactive approach to managing these assets for you.

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Contact Valor Today

Do you need help managing your minerals? If so, contact us today.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

In the dynamic and intricate world of oil and gas, operators and investors constantly navigate through a maze of challenges and opportunities. At Valor, we understand that venturing into outsourcing within this sector requires a partner who not only comprehends the complexities but can also offer tailored, efficient solutions. Therefore, we wanted to address the most common questions we receive from prospective clients about our oil and gas outsourcing services. From operational efficiencies to access to a flexible workforce and everything in between, our goal is to provide you with insights and answers that help you make informed decisions.

1. Does Valor handle Accounts Payable (AP) and cutting checks on behalf of operators?

Answer: Yes. At Valor, we manage accounts payable and processing payments on behalf of our oil and gas operator clients. Our services are designed to ensure that all vendor payments are managed efficiently, guaranteeing timely settlements that keep your operations running smoothly. We understand the importance of accuracy and promptness, which is why our process for invoice handling is streamlined and meticulous. By entrusting us with your AP needs, you can focus on your core business activities while we take care of ensuring your vendors are paid accurately and on time.

2. Will Valor handle issuing 1099s to vendors and mineral owners?

Answer: Yes. Valor takes the responsibility of issuing 1099 forms to both vendors and mineral owners, ensuring compliance with tax regulations for our oil and gas operator clients. We understand the critical importance of accurate and timely tax document preparation and distribution. By entrusting Valor with this task, operators can rest assured that their 1099 obligations are managed professionally, allowing them to focus on their core operational activities without the hassle of tax season worries.

3. Does Valor maintain Division of Interests (DOI)?

Answer: Yes. Valor fully supports Division of Interest (DOI) management on behalf of operators. We handle everything from setting up and maintaining accurate DOI records, integrating with existing accounting systems, to ensuring compliance with regulatory standards. Our services include verifying ownership titles, resolving disputes, and making necessary adjustments due to changes in ownership. With advanced software and a robust experienced team, Valor efficiently manages DOI, ensuring that all financial distributions are accurate and that your operations remain compliant with all legal requirements. This comprehensive management allows operators to focus on their core activities, confident that their DOI is in expert hands.

4. Does your team support one-off projects?

Answer: Yes. Valor does support one-off projects for operators. Our team is equipped to handle specific, tailored projects according to your unique needs, ensuring expert management and timely completion.

5. How does Valor handle communication and collaboration with a client’s in-house team?

Answer: Our goal is to act as an extension of your team. At Valor, we prioritize seamless communication and collaboration with our clients’ in-house teams. We establish clear communication channels from the outset, ensuring that all project updates, decisions, and necessary information are shared promptly and transparently.

Contact Valor Today

Do you need oil and gas outsourcing support? Contact us today.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

In the dynamic world of oil and gas operations, efficient and accurate production reporting stands as a cornerstone of successful management and regulatory compliance. Valor is at the forefront of providing solutions tailored to enhance the production reporting process for oil and gas operators. Our services are designed to tackle the challenges of production reporting head-on, ensuring operators can maximize efficiency, ensure compliance, and make informed decisions. Let’s delve into what production reporting is, its importance and how Valor can help.

What is Production Reporting?

For operator services, production reporting encompasses several key activities:

• Data Collection: Gathering accurate and timely data on the volume of hydrocarbons and water produced from each well. Modern technologies can facilitate real-time data collection directly from the wellhead.
• Data Analysis: Analyzing this data to identify trends, optimize production, and assess the performance of each well. This can involve comparing expected versus actual production volumes and understanding the reasons for any discrepancies.
• Regulatory Compliance: Submitting detailed production reports to relevant regulatory bodies to comply with local, state, and national regulations. These reports are crucial for demonstrating compliance with environmental standards, paying appropriate taxes, and fulfilling royalty obligations.
• Financial Reporting and Forecasting: Using production data to inform financial statements, investor reports, and operational forecasting. This includes estimating future production volumes, revenues, and assessing the economic viability of assets.

Why is Production Reporting Important?

1. Regulatory Compliance: Regulatory bodies require detailed production reports to ensure that operations are conducted responsibly and that appropriate royalties and taxes are paid. Compliance avoids legal penalties and sustains good standing within regulatory frameworks.

2. Operational Efficiency: Regular, accurate production reporting allows operators to monitor the performance of their wells closely, identifying issues such as equipment failures or declines in reservoir productivity early. This can lead to timely interventions that restore or enhance production levels.

3. Financial Management: Production data directly impacts an operator’s financial performance. Accurate reporting ensures that operators can reliably track revenue, manage cash flow, and make informed decisions about investments, operations, and strategic planning.

4. Strategic Decision Making: By analyzing production data over time, operators can identify trends and opportunities for optimization, such as the potential for enhanced oil recovery techniques or the need to adjust development plans. This supports more strategic, data-driven decision-making.

5. Stakeholder Confidence: Transparent and accurate production reporting builds trust with stakeholders, including investors, partners, and the public. It demonstrates operational competence and financial viability, which are crucial for attracting investment and maintaining a company’s reputation.

6. Environmental Stewardship: Through detailed production reporting, operators can also monitor and manage their environmental impact, ensuring compliance with regulations designed to protect ecosystems and reduce carbon footprints. This is increasingly important in the context of global efforts to address climate change and promote sustainable energy practices.

Valor’s Added Value

Valor’s dedicated oil and gas outsourcing team specializes in handling the intricacies of production reporting for oil and gas operators, offering a seamless, efficient solution that significantly reduces the burden on operators. Our team is equipped with the latest technology and in-depth industry knowledge, ensuring that all aspects of production reporting—from data collection and analysis to regulatory submission and financial forecasting—are managed accurately and in compliance with all relevant laws and regulations. By entrusting Valor with this critical function, operators can reallocate their time and resources towards core operational activities, focusing on optimizing production and exploring new opportunities without the overhead of managing complex reporting requirements. Valor’s outsourcing services not only ensure regulatory and financial compliance but also provide operators with peace of mind and the freedom to pursue strategic objectives, secure in the knowledge that their production reporting is in expert hands.

Conclusion

In an industry where efficiency, compliance, and informed decision-making are paramount, Valor stands as a beacon of support, offering oil and gas operators the tools they need to succeed. Our production reporting solutions are designed with the operator’s needs in mind, ensuring that every aspect of production reporting is covered, from regulatory compliance to financial transparency. Let Valor empower your operations with the clarity and efficiency needed to thrive in today’s competitive oil and gas landscape.

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Contact Valor Today

Contact us today if you need support with managing your production reporting.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Welcome to our Valor Employee Spotlight series! In this edition, we’re thrilled to introduce Jeff Rowe, Senior Data Analyst. Jeff is a vital member of the Valor family and we can’t wait for you to learn more about him!

Background and Experience

Jeff’s professional journey is a testament to his adaptability and passion for continuous learning. As a traveling project accountant, he traversed the country, immersing himself in diverse job sites and serving as a crucial link between those locations and the corporate office. This role not only honed his skills in processes, analytics, systems, and procedures but also ignited his love for these domains. It was amidst this backdrop of constant travel and exploration of new environments that Jeff discovered another passion: programming. In his spare time, he began to delve into the world of coding, demonstrating his eagerness to expand his expertise and embrace new challenges. This combination of practical experience in finance and accounting, coupled with an interest in programming, has equipped Jeff with a unique blend of skills that are highly valuable in the modern workplace.

Role at Valor

In his role as a Senior Data Analyst at Valor, Jeff plays a pivotal role in steering the company towards data-driven decision-making and operational excellence. His primary responsibilities involve analyzing and interpreting complex data sets to unearth actionable insights that guide strategic business decisions and enhance operational efficiency. During a period of unprecedented growth, Jeff has been at the forefront of developing and leading accounting efforts, ensuring the organization scales its financial processes efficiently and effectively.

Jeff’s technical skillset has led to the creation of innovative solutions aimed at automating internal processes and managing expenses more effectively, thereby contributing significantly to the company’s bottom line. His proficiency in VBA, SQL, and the Windows Operating System, along with a deep understanding of the Microsoft Office Suite and Google Workspace, enables him to tailor solutions that fit Valor’s unique needs. Moreover, Jeff’s skills extend to Python custom development, where he leverages this powerful programming language to build bespoke tools and applications that further automate and streamline Valor’s operations.

Jeff’s Favorites

Outside the Office
Outside the office, Jeff enjoys further honing his programming skills, spending time with his wife, and playing video games.

Favorite Drink/Food
Jeff is both a coffee addict and connoisseur, delighting in exploring the diverse world of coffee flavors and brews. When it comes to food, his guilty pleasure is Taco Bell.

What Jeff Loves Most About Valor

Jeff’s favorite aspects of working at Valor revolve around the vibrant work environment and the culture of innovation that permeates the company. He is particularly enthusiastic about going to work every day, not just to tackle the tasks at hand, but to “geek out” on new projects that challenge his skills and expand his knowledge. He also appreciates the personal space and focus that comes with having his space, combined with the company’s provision of all the necessary tools and resources, fosters his creative freedom. This autonomy allows him to explore and implement innovative solutions, making his role at Valor deeply rewarding and aligned with his professional aspirations and personal interests.

Jeff is a remarkable example of the talent we have here at Valor. Stay tuned for more employee spotlights to learn about the incredible individuals who make Valor a great place to work!

In the intricate world of financial regulations, two terms often surface with significant legal implications: royalty reporting and escheatment. As a leading consultant in regulatory compliance, Valor is dedicated to guiding our clients through these complex processes, ensuring full adherence to the law and safeguarding their land and interests.

Understanding Royalty Reporting

Royalty reporting is a critical component for oil and gas companies involved in licensing agreements or those that generate revenue through royalties. It involves the meticulous documentation and reporting of royalties owed or paid to other entities, whether they are individuals, companies, or governmental bodies. This process ensures transparency and compliance with contractual and legal obligations.

Valor’s expertise in this area shines through our personalized services. We assist clients in:

1. 1. Accurate Calculation: Ensuring the correct calculation of royalties based on the agreed-upon terms.
2. 2. Timely Reporting: Facilitating timely reporting to all stakeholders, thereby avoiding legal complications.
3. 3. Audit Preparation: Preparing for and managing audits to verify the accuracy of reported royalties.

Demystifying Escheatment

Escheatment is the process whereby unclaimed property or financial assets are turned over to the state after a certain period of inactivity or lack of contact with the owner. This could include uncashed checks, dormant bank accounts, unclaimed dividends, or forgotten insurance proceeds.

Valor’s role in escheatment includes:

• 1. Unclaimed Property Management: We help companies and individuals identify and manage unclaimed property on their books.
• 2. Compliance with Escheatment Laws: Every state has its own set of escheatment laws. Valor ensures that our clients are fully compliant with these diverse and often complex regulations.
• 3. Return to Rightful Owners: Our team puts in concerted efforts to return unclaimed properties to their rightful owners. When this is not possible, we facilitate the escheatment process to the state as mandated by law.

With years of experience and a deep understanding of regulatory filing and escheatment laws, Valor is a trusted partner in navigating these legal landscapes. We recognize that each client has unique needs. Our team offers tailored solutions to meet these specific requirements. Our foremost priority is ensuring that our clients remain fully compliant with all legal obligations, thereby protecting them from potential legal and financial penalties.

Questions? Need support? Contact us today.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

The world of oil and gas is complex and multifaceted, with its own set of rules, regulations, and financial instruments. One such instrument is the “Oil and Gas Lien”. Understanding this concept is crucial for anyone involved in the oil and gas industry, whether you are a landowner, investor, operator, mineral manager or even a service provider.

What is an Oil and Gas Lien?

At its core, an oil and gas lien is a legal claim or hold placed on an oil and gas-producing property, typically by a creditor. This lien arises when a company working on the property, such as a contractor or supplier, is not paid for the services or goods provided. The lien ensures that the unpaid party has a legal claim to a portion of the property’s value or revenue until the debt is settled.

Types of Liens

1. Mineral Liens: These are specific to the oil and gas industry and are placed directly on the mineral rights of a property. They ensure that those who provide services or supplies specifically for the extraction of minerals (oil and gas) have a way to secure payment.
2. Mechanic’s and Materialman’s Liens: While similar to mineral liens, these are broader and can apply to any type of property, not just mineral rights.

Why are Oil and Gas Liens Critical?

Protection for Service Providers

Oil and gas projects often involve large sums of money and multiple contractors and suppliers. Liens provide a layer of financial protection to these entities, ensuring they have a legal avenue to seek payment.

Security for Landowners and Operators

For landowners and operators, understanding and managing liens is crucial. A lien can affect the ability to sell or develop the property and can lead to legal disputes if not properly addressed.

Impact on Transactions

In oil and gas transactions, liens must be carefully considered. They can impact the value of a property and complicate mergers, acquisitions, and other financial dealings.

How Does an Oil and Gas Lien Work?

1. Filing a Lien: If a service provider is not paid, they can file a lien against the property where the work was performed. This process varies by jurisdiction but generally involves filing specific documents with a local court or legal authority.
2. Enforcement: Once a lien is filed, it must be enforced, typically through legal action. This can lead to a court ordering the sale of the property to pay off the debt.
3. Resolution: Liens are often resolved through negotiation and payment, without needing to resort to legal enforcement.

Considerations

The laws governing oil and gas liens vary significantly from one jurisdiction to another. It’s crucial for all parties involved to be aware of the specific legal framework in their area and to seek expert advice when dealing with liens.

Oil and gas liens play a critical role in the financial dynamics of the oil and gas industry. They provide security and assurance to service providers and suppliers, while also posing significant considerations for landowners and operators. Understanding the nuances of these liens is essential for anyone involved in this sector to navigate the complex legal and financial landscape effectively.

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Contact Valor Today

Contact us today if you have any questions regarding oil and gas liens.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

Minerals and oil are valuable natural resources, and when they are found on your property, understanding the concept of royalties becomes crucial. Royalties are a significant part of the natural resource extraction industry, offering a way for property owners to earn from the minerals or oil extracted from their land. In this blog post, we will delve into what mineral and oil royalties are, key considerations, and essential insights for property owners.

What are Mineral and Oil Royalties?

Definition and Basics

Mineral and oil royalties are payments made by an extractor, typically a mining or oil company, to the owner of the mineral rights. These payments are a percentage of the value of the minerals or oil extracted from the land. This means if you own land with valuable minerals or oil reserves, you can earn royalties without actively participating in the extraction process.

Types of Royalties

1. Flat Royalties: A fixed amount paid per unit of extracted resource, regardless of market price.
2. Percentage Royalties: A more common form, where the payment is a percentage of the value of the extracted resources.
3. Sliding Scale Royalties: These vary based on the volume or value of the extracted resource.

Key Considerations

Mineral Rights vs. Surface Rights

Understanding the distinction between mineral rights and surface rights is crucial. In many regions, these rights can be owned separately. This means you could own the land (surface rights) but not the rights to the minerals beneath it.

Legal and Contractual Aspects

Royalty agreements are legally binding contracts. They outline the terms, conditions, and the percentage of royalties. It’s essential to have a clear, well-drafted agreement that addresses potential disputes, the duration of the agreement, and other specific terms.

Market Value and Pricing

The value of royalties fluctuates with the market price of the resource. For oil royalties, factors like global oil prices, production levels, and technological advancements in extraction can significantly impact royalty earnings.

What You Need to Know

Tax Implications

Royalties are considered income and are subject to taxation. The tax treatment of these royalties can be complex, and it’s advisable to consult with a tax professional to understand your obligations.

Environmental Considerations

Extraction activities can have environmental impacts. Be aware of the environmental regulations and potential consequences of extraction activities on your property.

Negotiating Royalties

Negotiation is key. The terms of the negotiated royalty agreement, including the percentage, are not set in stone and can often be negotiated. It’s advisable to seek legal counsel to negotiate the best possible terms.

Long-term Prospects

Consider the long-term implications of allowing mineral or oil extraction on your property. This includes the potential for depletion of resources and impacts on property value.

Monitoring and Auditing

Ensure you have provisions for monitoring and auditing the extraction process. This is crucial to verify that the royalty payments you receive are accurate and fair.

Mineral and oil royalties can be a lucrative source of income for property owners, but they come with a complex set of considerations. Understanding the nature of these royalties, the legal and market factors involved, and the long-term implications are essential. Always seek professional advice to navigate the intricacies of mineral management and oil royalties effectively.

Remember, your land is a valuable asset, and managing it wisely, especially when it comes to natural resources, can lead to significant financial benefits. Stay informed and seek support when negotiating to make the most of your mineral and oil royalty opportunities.

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Contact Valor Today

Interested in learning more about how Valor can assist you with managing your royalties? Contact us today and take the first step toward securing your assets.

The information provided by Valor in this blog is for general informational purposes only, not to provide specific recommendations or legal or tax-related advice. The blog/website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.