A Puerto Rico Assignment of Overriding Royalty Interest Convertible to A Working Interest At Assignee's Option is a legal document that allows for the transfer of rights to a portion of the production revenues from an oil or gas well located in Puerto Rico. Under this arrangement, the assignor grants an overriding royalty interest (ORRIS) to the assignee. An ORRIS is a fractional interest calculated based on the gross revenue from the sale of hydrocarbons produced from the well. The assignee, however, has the option to convert the ORRIS to a working interest (WI) at any time. A working interest grants the assignee the right to participate in the management and operation of the well, as well as bear a corresponding share of the costs and liabilities associated with the production activities. This can include expenses related to drilling, completion, maintenance, and production from the well. The Puerto Rico Assignment of Overriding Royalty Interest Convertible to A Working Interest At Assignee's Option is commonly used in the oil and gas industry to facilitate the transfer of interests in producing assets. It enables the assignor to provide an opportunity for the assignee to potentially earn a greater return by converting the royalty interest into a working interest that comes with increased ownership and operational control. However, it's important to note that the terms and conditions outlined in the assignment can vary depending on the specific agreement between the parties involved. Factors such as the percentage of the ORRIS, the timeframes for conversion, and any limitations on the working interest should be clearly defined within the assignment. Ultimately, the Puerto Rico Assignment of Overriding Royalty Interest Convertible to A Working Interest At Assignee's Option provides a flexible solution for parties seeking to transfer interests in Puerto Rico's oil and gas assets. By enabling the assignee to convert their ORRIS into a working interest, this arrangement allows for a potential increase in both ownership and involvement in the operation of the well.
Puerto Rico Assignment of Overriding Royalty Interest Convertible to A Working Interest At Assignee's Option
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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.
Overriding Royalty Interest Conveyance means an assignment, in form and substance acceptable to Lender, pursuant to which Borrower grants in favor of Lender an overriding royalty interest equal to six and one-fourth percent (6.25%) of Hydrocarbons produced, saved and sold or used off the premises of the relevant Lease, ...
Overriding Royalty Interest Conveyance means an assignment, in form and substance acceptable to Lender, pursuant to which Borrower grants in favor of Lender an overriding royalty interest equal to six and one-fourth percent (6.25%) of Hydrocarbons produced, saved and sold or used off the premises of the relevant Lease, ...
Working Interest (WI) Value ? Since the overriding royalty interest (ORRI) is a portion of the working interest, the WI value is the major determinant of the value of overriding mineral rights. The WI owner incurs all of the costs associated with exploration and development activity.
Calculating Overriding Royalty Interest An ORRI is a straight percentage. For example, a 2% override would appear on the royalty statement as 0.02 interest in the proceeds from the sale of the leased hydrocarbons.
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.
ORRIs are created out of the working interest in a property and do not affect mineral owners. An overriding royalty interest (ORRI) is often kept or assigned to a geologist, landman, brokerage, or any entity that was able to reserve an interest in the properties.
Overriding 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.