Maybe it implies that a large rise in the number of shareholders means that there will be an exuberant if not irrational upward pressure in share price. Let’s hope.
I have a question that is unrelated to this particular post – there is talk of negative oil prices in certain areas becoming a real possibility. If that happens in the permian, does that mean TPL actually has to pay their percentage of the royalty? Or do they just get 0? I’m assuming negative prices were not part of any contract, does anyone have any idea?
Only ‘Working’ interests pay expenses. Royalty interests are overriding and the only thing that affects them is the price of oil sold. The well has to be shutdown and not producing for TPL (and us) in order for us not to get revenue.
My point is the price of oil sold might go negative, and TPL has 1/8 or 1/16 royalty. If the price is negative, logic implies TPL would actually have to pay 1/8 or 1/16 of the price (as they receive this amount when price is positive). Question is, is this true, or do they not pay anything and just get 0 when prices are negative?
How can oil prices go negative? That would imply that the oil companies are buying oil back which isn’t going to happen. Oil may sell for lower than the price to produce it, but that only reduces the amount of the royalty to those who old royalty interests. Any loss is only incurred by the driller/operator/owner of the wells. I’ve owned many working interests and I would much rather buy TPL since my only investment is the price of the shares.
There are several reports out that certain areas of the US and Canada will be facing negative oil prices because of storage/pipeline constraints – oil companies will have to pay operators to take their oil. This same thing happened to natural gas in the permian a few months ago, so yes, its a very real possibility.
The Texas Pacific Land Trust Investor 
Is that because RobinHood has rolled out fractional stock purchases so people can get in for less that she share price?
LikeLiked by 1 person
That must be it.
LikeLike
What is this trying to imply? It makes no sense without an explanation.
LikeLiked by 1 person
Maybe it implies that a large rise in the number of shareholders means that there will be an exuberant if not irrational upward pressure in share price. Let’s hope.
LikeLiked by 1 person
I have a question that is unrelated to this particular post – there is talk of negative oil prices in certain areas becoming a real possibility. If that happens in the permian, does that mean TPL actually has to pay their percentage of the royalty? Or do they just get 0? I’m assuming negative prices were not part of any contract, does anyone have any idea?
LikeLiked by 1 person
Only ‘Working’ interests pay expenses. Royalty interests are overriding and the only thing that affects them is the price of oil sold. The well has to be shutdown and not producing for TPL (and us) in order for us not to get revenue.
LikeLike
My point is the price of oil sold might go negative, and TPL has 1/8 or 1/16 royalty. If the price is negative, logic implies TPL would actually have to pay 1/8 or 1/16 of the price (as they receive this amount when price is positive). Question is, is this true, or do they not pay anything and just get 0 when prices are negative?
LikeLiked by 1 person
How can oil prices go negative? That would imply that the oil companies are buying oil back which isn’t going to happen. Oil may sell for lower than the price to produce it, but that only reduces the amount of the royalty to those who old royalty interests. Any loss is only incurred by the driller/operator/owner of the wells. I’ve owned many working interests and I would much rather buy TPL since my only investment is the price of the shares.
LikeLiked by 1 person
That should be ‘HOLD’ not ‘OLD’.
LikeLiked by 1 person
There are several reports out that certain areas of the US and Canada will be facing negative oil prices because of storage/pipeline constraints – oil companies will have to pay operators to take their oil. This same thing happened to natural gas in the permian a few months ago, so yes, its a very real possibility.
LikeLiked by 1 person
Does TPL have to pay royalty income back to oil producers now that oil is negative?
LikeLike