Keywords: New Mexico, assignment, overriding royalty interest, working interest owner, single lease, stated percentage. A New Mexico Assignment of Overriding Royalty Interest in Working Interest Owner, Single Lease, Stated Percentage, refers to a legal document that transfers a portion of the royalty interest owned by the working interest owner to another party. This assignment is specific to New Mexico, which is known for its rich oil and gas reserves. The overriding royalty interest is a type of royalty interest that allows the holder to receive a percentage of the revenue generated from the production of oil or gas from a specific lease. The working interest owner, who has the right to explore and develop the lease, may assign a portion of their overriding royalty interest to another party. This assignment is applicable to single leases, meaning that it pertains to a specific leasehold interest rather than multiple leases. It allows the working interest owner to transfer a stated percentage of their overriding royalty interest to the assignee. The stated percentage represents the exact portion of the royalty interest being assigned. Different variations of the New Mexico Assignment of Overriding Royalty Interest in Working Interest Owner, Single Lease, Stated Percentage may exist depending on specific circumstances. These variations could include different stated percentages, where the assignor transfers different portions of their overriding royalty interest to multiple assignees. Furthermore, there may be variations in terms of the assignment's duration, where the parties involved may agree on a fixed term during which the assignee will receive the assigned overriding royalty interest. Alternatively, the assignment may be perpetual, meaning that the assignee will continue to receive the stated percentage for the duration of the lease's life. It's important to note that the New Mexico Assignment of Overriding Royalty Interest in Working Interest Owner, Single Lease, Stated Percentage should adhere to the laws and regulations of New Mexico and comply with any additional requirements set forth by the governing authorities. Additionally, it is always recommended consulting legal professionals experienced in oil and gas transactions to ensure the assignment accurately reflects the intentions and interests of the parties involved.
New Mexico Assignment of Overriding Royalty Interest by Working Interest Owner, Single Lease, Stated Percentage
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FAQ
An overriding royalty interest (ORRI) is an interest carved out of a working interest. It is: A percentage of gross production that is not charged with any expenses of exploring, developing, producing, and operating a well.
Like Royalty Interest (RI), an ORRI ends when the oil and gas lease ends. ORRI and MI/RI (mineral/royalty) interests in the same tract of land may be valued differently. Unlike the mineral interest, which lasts in perpetuity, overriding royalties expire with the lease.
An override provision allows for ongoing royalty payment on future albums, sometimes including those not produced by the original producer.
Hear this out loud PauseOverriding Royalty Interest: A given interest severed out of the record title interest or lessee's share of the oil, and not charged with any of the cost or expense of developing or operation. The interest provides no control over the operations of the lease, only revenue from lease production.
How to calculate the overriding royalty interest? ORRI = NRI * 5 percent. $750,000 * 0.005 = $3,750.
Hear this out loud PauseAn overriding royalty interest (ORRI) is an interest carved out of a working interest. It is: A percentage of gross production that is not charged with any expenses of exploring, developing, producing, and operating a well.
Hear this out loud PauseThere are three main types of royalty interests: Overriding royalty interest: Unlike mineral and royalty interests, an overriding royalty interest runs with a lease and not with the land. Therefore, they only remain in effect for as long as a lease is in effect and they expire when a lease expires.
What Determines the Value of an Overriding Royalty Interest? 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.
