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.
North Carolina Shut-In Gas Royalty refers to the compensation received by gas leaseholders in North Carolina for gas wells that are temporarily shut-in or not producing due to market conditions, lack of demand, or operational reasons. This royalty payment is a form of financial reimbursement provided to the leaseholders for lost income during the period of shut-in. The North Carolina Department of Environmental Quality (NC DEQ) regulates the oil and gas industry in the state, and it oversees the collection and distribution of royalties. The shut-in gas royalty is calculated based on a percentage of the market value of the gas that would have been produced during the shut-in period. There are two types of North Carolina Shut-In Gas Royalty: 1. Temporary Shut-In: This type of shut-in occurs when gas wells are temporarily stopped from producing due to short-term market fluctuations, seasonal demands, or routine maintenance. The temporary shut-in gas royalty compensates the leaseholders during this period of non-production. 2. Extended Shut-In: Extended shut-in occurs when gas wells are shut down for an extended period due to various reasons such as low gas prices, insufficient infrastructure, or lack of market demand. The extended shut-in gas royalty ensures that the leaseholders receive compensation for their loss of income during this extended period. The process of calculating and disbursing royalty payments varies depending on the lease agreements and individual circumstances. Leaseholders are often required to file applications with the NC DEQ to notify them of the shut-in status and provide relevant documentation to support their claim for shut-in gas royalty. In conclusion, North Carolina Shut-In Gas Royalty is a form of compensation received by gas leaseholders for gas wells that are temporarily or extended shut-in. It serves as a financial support mechanism to offset the lost income during the shut-in period.
