The North Carolina Assignment of Carried Working Interest is a legal document that establishes the transfer of ownership rights and obligations related to a carried working interest in oil, gas, or mineral leases, specifically in the state of North Carolina. This agreement enables one party, known as the assignor, to assign their interest to another party, known as the assignee, who assumes the responsibilities and benefits associated with the working interest. In this assignment, the assignor relinquishes their share of the expenses, liabilities, and risks associated with exploration, development, and production activities. In return, the assignee gains the right to receive a portion of the proceeds or profits generated from the working interest. This arrangement is typically implemented to facilitate partnerships or joint ventures within the oil, gas, or mineral industry in North Carolina. There are several types of North Carolina Assignment of Carried Working Interest agreements, each serving a unique purpose or addressing specific circumstances. These types include: 1. Farm out Agreement: This assignment occurs when the assignor grants the assignee the right to earn an interest in an existing lease or property by drilling a well or providing other specified services. The assignee carries the expenses of drilling or exploration activities until a predetermined milestone is achieved or a certain volume of production is reached. 2. Participation Agreement: This type of assignment allows the assignee to acquire an interest in an existing lease or property by contributing a portion of the costs and expenses related to its development or operation. The assignee becomes a working interest owner and shares in both the costs and revenues proportionally. 3. Back-in Assignment: In this arrangement, the assignor initially carries the assignee's working interest, but upon the occurrence of specific conditions, the assignor has the option to retain a share in the interest, usually at a reduced cost or with specific terms. This type of assignment is often utilized when a party wants to temporarily transfer their interest while retaining the right to reacquire it later. 4. Overriding Royalty Assignment: This assignment involves assigning a portion of the royalties, usually a specific percentage or fraction, generated from the working interest to an assignee. The assignee does not bear the expenses, risks, or liabilities associated with the development or operations but receives a profit share solely from the production revenues. In North Carolina, these types of assignments are governed by the state's specific laws and regulations, along with any additional terms set forth in the assignment agreement. Parties involved in an Assignment of Carried Working Interest should seek legal assistance to ensure compliance with applicable laws and to protect their rights and interests.
North Carolina Assignment of Carried Working Interest
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Net Revenue Interest is the portion of an oil and gas leaseholder's interest in production that they are entitled to receive as part of their lease. The amount is calculated after deducting all royalty payments, production costs, and other fees.
The definition of assignment in real estate is the sale, transfer, or conveyance of a whole property ownership/rights or part of it to another party. The term in the oil and gas industry is used for sale, transfer, or conveyance of working interest, lease, royalty, overriding royalty interest, or net profit interest.
Wellbore. An assignment can be limited to the wellbore of a well. A wellbore limitation means that the assignor is assigning only those rights to production from the wellbore of a certain well, arguably at the total depth it existed at the time of the assignment.
The lessee of an oil or gas lease can assign the entire lease or part of it. In other words, the lessee can sell or transfer part of the estate or the entire estate to which they have the working rights. The assignee is assigned the working interest and lease obligations, including override royalty.
ASSIGNMENT: The legal instrument whereby Oil and Gas Leases or Overriding Royalty interests are assigned or conveyed. ASSIGNMENT CLAUSE: A clause in any legal instrument that allows either party to the contract to assign all or part of his or her interest to others.
Oil and gas interests are interests in real property and thereby have the same attributes as other real property such as a home or a ranch. Although the ownership of oil and gas interests can take many forms, courts commonly analogize the ownership of oil and gas interests to a bundle of sticks.
An assignment of oil and gas lease is a contractual agreement between a landowner and an oil or gas company in which the company gains the right to explore for, develop, and produce oil and gas from the property.
A percentage of ownership in an oil and gas lease granting its owner the right to explore, drill and produce oil and gas from a tract of property. Working interest owners are obligated to pay a corresponding percentage of the cost of leasing, drilling, producing and operating a well or unit.
