Detailed description: An Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction) refers to a legal document that conveys the ownership of a specific portion of the royalties generated from an oil and gas lease in the state of Oklahoma. This type of assignment is commonly used in the oil and gas industry to transfer the rights to receive royalties to another party, while ensuring that the assigned interest is not subject to any proportionate reduction. In Oklahoma, there may be different types of Assignment of Overriding Royalty Interest (No Proportionate Reduction), including specific variations tailored to meet the requirements of different scenarios. One such variation is the Assignment of Overriding Royalty Interest (No Proportionate Reduction) for a specific lease. This type of assignment is used when an overriding royalty interest, which is usually created in favor of the assignor under the terms of an oil and gas lease, is transferred to another party without any proportionate reduction. Another variation of Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction) may involve the assignment of a percentage interest in the royalty without any proportionate reduction. This means that the assignor transfers a specified percentage of the royalties generated from the lease, while ensuring that the assigned interest remains intact and is not reduced proportionately. The purpose of executing an Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction) is often to allow for the transfer of royalty rights to a third party who wishes to participate in the potential income generated from the oil and gas lease. The assignee, or the party to whom the royalty interest is assigned, becomes entitled to receive a portion of the royalties generated by the lease, usually in exchange for monetary consideration provided to the assignor. It is crucial to draft an Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction) with great care and attention to detail. The document should clearly outline the rights and obligations of both parties involved, including the assignor and the assignee. It should specify the exact portion or percentage of the overriding royalty interest being transferred, and confirm that the assigned interest is not subject to any proportionate reduction. In conclusion, an Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction) is a legal instrument used in the oil and gas industry to transfer a portion or percentage of the royalties generated from an oil and gas lease. This document ensures that the assigned interest remains intact without any reduction and outlines the rights and obligations of the assignor and assignee.
Oklahoma Assignment of Overriding Royalty Interest (No Proportionate Reduction)
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FAQ
An overriding royalty agreement is a contract that gives an entity the right to receive revenue from certain productions or sales. The specific type of occurence that royalties are required to be paid on is included in the overriding royalty agreement.
The statutory minimum is 1/8th or 12.5%, but it may be as high as 1/4th, or 25%. Since the 1990s, Oklahoma royalties have typically been at least 18.75 percent, but 20 to 25 percent is not unheard of for Oklahoma mineral owners.
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.
Several factors determine the value of an overriding royalty interest in a working lease. They include: Location ? A mineral interest in high producing shale basins will be more valuable. Producing Wells ? Producing wells are valued higher than non-producing wells.
8/8ths / 8/8ths Basis: a term used to describe either the full Working Interest or full Net Revenue Interest with respect to a given Tract. Pursuant to an Oil and Gas Lease, the Lessor retains the Lessor Royalty.
You may convey overriding royalty interest on either an Assignment of Record Title Interest (Form 3000-3), a Transfer of Operating Rights (Form 3000-3a), or on a private assignment. We only require filing of one signed copy per assignment plus a nonrefundable filing fee found at 43 CFR 3000.12.
An overriding royalty interest (ORRI) is an undivided interest in a mineral lease giving the holder the right to a proportional share (receive revenue) of the sale of oil and gas produced. The ORRI is carved out of the working interest or lease.
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.