What is a “Washout Provision”? The term “washout provision” can be misleading because there is actually no such provision. Instead, it refers to the situation where an overriding royalty interest is created in an assignment of an oil and gas lease to a new owner. When the assigned lease expires, the overriding royalty interest […]
I keep getting questions on what the difference is between a fixed vs floating royalty is so I thought I would write this article to help explain the distinction. Landmark Case: The landmark case on whether a royalty is “fixed” or “floating” is U.S. Shale Energy II, LLC et al. vs. LaBorde Properties, LP, et […]
At long last, we are pleased to introduce our brand new Lease & Title Analyst Certificate Program! Designed to teach lease and title analysts and other land professionals in the oil and gas industry, the knowledge and skills necessary to be a competent and effective lease and title analyst. Lease & title analysts are an […]
I have some great news – the American Association of Professional Landmen published my article on allocation wells in their January/February issue of The Landman magazine! It’s the first time I’ve had an article appear there and I hope it won’t be the last. I am often asked what allocation wells are and how royalty is […]
In this third and final installment on allocation wells, we are going to examine the difference to the mineral owner in terms of which is better for them – an allocation well or a single well? Let’s assume we have a mineral owner with a 100% interest in a 320-acre tract of land and he […]
In the last newsletter, we learned that one of the formulas for calculating interests in an allocation well is: AllocationRoyalty Calculation Lateral length of horizontal well bore on lessor’s tract Total horizontal wellbore length This month, I thought it would be beneficial to apply the allocation tract factor and do an actual calculation based on […]
One question that I am repeatedly asked lately is what are Allocation Wells and how is royalty calculated in one for division order purposes? So, I thought I would answer those questions in this month’s newsletter and begin a series about this important current topic. For this month’s newsletter, we’ll answer these questions beginning with […]
Let’s celebrate! As many of you may have attended high school and college graduations for your family or friends this past month, I too want to celebrate in our Midland College family. This month I’m honoring your peers who successfully completed one of our six-month, online certificate programs. As working professionals, it’s often tough to […]
Answer: No, if the lease is a “market value at the well lease” and the gas is used to power equipment used to make the gas marketable, no royalties are due. In another victory for oil and gas companies, royalty owners who brought a class action lawsuit in the U.S. District Court for the Southern […]
An MFN is an abbreviation for a clause in an oil and gas lease known as a Most Favored Nation clause. The term derives from international economic relations requiring that all countries be treated equally in terms of favorable trade treatment. In the oil and gas business, an MFN typically requires that if a lessee […]