Lease Owners Claim Antero Resources Underpays Gas Royalties

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Three lease owners have filed suit against Antero Resources Corporation for allegedly breaching its contracts and underpaying royalties on the gas produced from the owners’ properties. The plaintiffs claim Antero illegally deducts from their royalty payments post-production costs incurred by transforming the “wet gas” collected from their properties into marketable form. According to the complaint, the gas must be processed into various types of liquid gas products (such as ethane, butane, isobutane, propane, and natural gasoline) before it can be sold to a third party. The suit argues that Antero unlawfully deducts these processing costs from royalty payments, in violation of its contracts with the plaintiffs and proposed class members.

According to the suit, the defendant further breaches its contracts by failing to calculate royalty payments based on the gas products’ actual price of sale, resulting in lease owners sustaining “substantial damages.”