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.
Mississippi Reservation of Additional Interests in Production refers to a legal provision that allows landowners in the state of Mississippi to retain certain rights and interests in their property when they lease their land for oil, gas, or mineral extraction. This reservation ensures that landowners can benefit from any additional interests or profits that may arise from the production activities carried out on their land. The Mississippi Reservation of Additional Interests in Production typically includes various types of interests that are reserved by the landowners. These interests can be classified into two main types: 1. Overriding Royalty Interest (ORRIS): An ORRIS is a portion of the future production or revenue generated from the leased property that is reserved by the landowner, even after leasing the property to a production company. This interest is often expressed as a fraction or percentage and entitles the landowner to receive a share of the production revenues, usually free of any production costs incurred by the lessee. 2. Working Interest (WI): A WI refers to the percentage of ownership the landowner retains in the actual operation and development of the production activities. Unlike an ORRIS, the working interest carries a proportionate share of the expenses associated with exploration, drilling, operation, and maintenance of the wells. The landowner with a working interest actively participates in decision-making and shares both the risk and rewards of the production venture. The Mississippi Reservation of Additional Interests in Production is crucial for landowners as it safeguards their financial interests, ensuring they benefit from the production activities on their land. It provides them with a recurring source of income through the ORRIS and allows them to have a stake in the development and success of the wells through the WI. Landowners in Mississippi can negotiate and decide the specific terms and percentages of ORRIS and WI they wish to reserve when leasing their property. These negotiations may consider factors such as property size, the potential value of the resources, and prevailing market conditions. Therefore, it is essential for landowners to engage legal experts or experienced professionals to navigate the complexities of these negotiations and secure the most favorable terms. In conclusion, the Mississippi Reservation of Additional Interests in Production grants landowners the right to reserve overriding royalty interests and working interests in their leased land. By reserving these interests, landowners can secure ongoing financial benefits and retain a share in the development and operation of the production activities.
