This lease rider form may be used when you are involved in a lease transaction, and have made the decision to utilize the form of Oil and Gas Lease presented to you by the Lessee, and you want to include additional provisions to that Lease form to address specific concerns you may have, or place limitations on the rights granted the Lessee in the “standard” lease form.
Kansas Minimum Royalty Payments are legally binding agreements that set the minimum amount of money landowners in Kansas must receive from oil and gas companies for the extraction and production of oil and gas resources on their property. These payments ensure that landowners receive fair compensation for the use of their mineral rights. In Kansas, there are three types of Minimum Royalty Payments: 1. Lease-Based Minimum Royalty Payment: This type of payment is based on the terms and conditions specified in the lease agreement between the landowner and the oil and gas company. It establishes the minimum percentage or flat rate of royalties that the landowner will receive from the production of oil and gas. 2. Statutory Minimum Royalty Payment: Also known as "Statutory Minimum Royalty Interest," this payment is determined by Kansas state law and applies when there is no specific provision in the lease agreement dictating the royalty rate. The statutory minimum is set at 12.5% of the market value of the oil and gas produced from the land. 3. Proportional Payment Adjustment: This type of payment applies when the actual royalty payment received by the landowner falls below the statutory minimum. The landowner has the right to request an adjustment to ensure the minimum requirement is met. The adjustment is calculated based on the difference between the actual royalty payment and the statutory minimum. These Minimum Royalty Payments are crucial for protecting the rights of landowners and providing them with a fair share of the revenue generated from oil and gas extraction. They act as a safeguard against potential exploitation and allow landowners to benefit economically from their mineral rights. It's important for both landowners and oil and gas companies to understand and abide by these payment requirements to maintain a transparent and mutually beneficial relationship. Failure to comply with the Kansas Minimum Royalty Payments may result in legal disputes or penalties. In conclusion, Kansas Minimum Royalty Payments guarantee that landowners receive a minimum amount of compensation for the extraction and production of oil and gas on their property. Understanding the different types of payments, such as lease-based, statutory minimum, and proportional adjustment, is essential for landowners and oil and gas companies operating in Kansas.
