The Michigan Assignment of Overriding Royalty Interest (By Owner of Override) is a legal document that allows the owner of an overriding royalty interest (ORRIS) in an oil or gas lease to assign their interest to another party. This assignment transfers the rights and benefits of the ORRIS to the assignee, providing them with a share of the revenues generated from the production of oil or gas on the leased property. Keywords: Michigan, Assignment of Overriding Royalty Interest, Owner of Override, oil, gas, lease, assignee, assignment, ORRIS, revenue. There are two main types of Michigan Assignment of Overriding Royalty Interest (By Owner of Override): 1. Partial Assignment: This type of assignment allows the owner of an overriding royalty interest to assign only a portion of their interest to another party. This could be done for various reasons, such as raising capital or diversifying investments. The assignee will receive a percentage share of the ORRIS's revenue proportional to the assigned interest. 2. Full Assignment: In a full assignment, the owner of an overriding royalty interest assigns their entire interest to another party. This means that the assignee will become the new owner of the ORRIS and will receive all the rights and benefits associated with it, including the right to receive a percentage share of the revenue generated from oil or gas production. The Michigan Assignment of Overriding Royalty Interest (By Owner of Override) typically includes the following key elements: 1. Parties: The document identifies the owner of the overriding royalty interest as the assignor and the party receiving the assignment as the assignee. 2. Recitals: This section provides a brief background and context for the assignment, including the lease agreement that created the overriding royalty interest. 3. Assignment Clause: The assignment clause states that the assignor transfers and assigns their overriding royalty interest, including all rights and privileges, to the assignee. It specifies whether the assignment is partial or full. 4. Consideration: If there is any financial or other consideration involved in the assignment, it will be detailed in this section. Consideration could include a lump sum payment, ongoing royalty payments, or any other agreed-upon arrangement. 5. Royalty Interest Details: This portion of the document describes the specific details of the overriding royalty interest being assigned, including the percentage interest, the lease or property where the interest applies, and any restrictions or conditions associated with it. 6. Governing Law: The document specifies that the assignment is governed by the laws of the state of Michigan, ensuring its validity and enforceability in that jurisdiction. 7. Signatures: Both the assignor and assignee must sign and date the document to indicate their agreement and consent to the assignment. It is important to consult with a legal professional when drafting or executing a Michigan Assignment of Overriding Royalty Interest (By Owner of Override) to ensure its compliance with relevant laws and to protect the rights and interests of both parties involved.
Michigan Assignment of Overriding Royalty Interest (By Owner of Override)
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FAQ
Calculating Overriding Royalty Interest An ORRI is a straight percentage. For example, a 2% override would appear on the royalty statement as 0.02 interest in the proceeds from the sale of the leased hydrocarbons.
An overriding royalty interest (ORRI) is an undivided interest in a mineral lease giving the holder the right to a proportional share (receive revenue) of the sale of oil and gas produced. The ORRI is carved out of the working interest or lease.
You may convey overriding royalty interest on either an Assignment of Record Title Interest (Form 3000-3), a Transfer of Operating Rights (Form 3000-3a), or on a private assignment. We only require filing of one signed copy per assignment plus a nonrefundable filing fee found at 43 CFR 3000.12.
An overriding royalty interest (ORRI) is an undivided interest in a mineral lease giving the holder the right to a proportional share (receive revenue) of the sale of oil and gas produced. The ORRI is carved out of the working interest or lease.
Transfer by deed: You can sell your mineral rights to another person or company by deed. Transfer by will: You can specify who you want to inherit your mineral rights in your will. Transfer by lease: You can lease mineral rights to a third party through a lease agreement.
Several things determine what the ORRI value is, including: Mineral interest location. One in a shale basin with high production is worth more. Producing oil and gas wells. Wells currently producing are valued more. ... Production reserves and levels. ... Prices.
An overriding royalty interest (ORRI) is similar to a royalty interest in that it is also a portion of the proceeds from the sale of production. However, it is not retained under the terms of the oil and gas lease. An ORRI is granted, assigned and created under the terms of a separate document.
Overriding Royalty Interest Conveyance means an assignment, in form and substance acceptable to Lender, pursuant to which Borrower grants in favor of Lender an overriding royalty interest equal to six and one-fourth percent (6.25%) of Hydrocarbons produced, saved and sold or used off the premises of the relevant Lease, ...
