This provision provides for the assignor to except from this assignment and reserve an overriding royalty interest of all oil, gas, casinghead gas, and other minerals that may be produced from the lands under the terms of the Leases that are the subject of this assignment.
The New York Reservation of Overriding Royalty Interest is an important concept in the field of oil and gas leasing and refers to a specific arrangement between a lessor (landowner) and a lessee (oil or gas company) in the state of New York. This legal provision grants the lessor an overriding royalty interest (ORRIS) in addition to the regular royalty interest received from oil or gas production on the leased property. An overriding royalty interest entitles the lessor to a percentage share of the revenue generated from oil or gas production, which is calculated based on the gross value of production before any deductions are made. This type of interest is distinct from the regular royalty interest, which is typically a fixed percentage of the net value of the production after deducting certain expenses. The New York Reservation of Overriding Royalty Interest serves as a safeguard for the lessor, ensuring that they receive a fair share of the revenue generated from oil or gas production. It also enables the lessor to benefit from the potential upside if the property turns out to be highly productive. There are no specific subtypes or variations of the New York Reservation of Overriding Royalty Interest. However, it is worth mentioning that the terms and conditions of such reservations can vary depending on individual lease agreements and negotiations between the lessor and lessee. It is crucial for both parties to carefully review and understand the terms before entering into an agreement. The concept of the New York Reservation of Overriding Royalty Interest is vital for landowners considering oil and gas leasing in the state. By reserving an overriding royalty interest, the lessor can secure an additional revenue stream from the production on their property and maximize their financial returns. This provision plays a significant role in the fair distribution of profits between landowners and oil or gas companies and ensures a mutually beneficial relationship between the two parties.
