A South Carolina Assignment of Overriding Royalty Interest (No Proportionate Reduction) is a legal document that allows the transfer of an existing royalty interest in an oil, gas, or mining lease located in South Carolina, without reducing the proportionate share of the interest. This assignment is commonly used in the energy industry when a party wishes to assign their overriding royalty interest to another party. The overriding royalty interest refers to a share of the revenue generated from the production and sale of oil, gas, or minerals, which is paid to a party who does not hold the underlying mineral rights. This interest is typically created through a contractual agreement between the royalty owner and the lessee or operator of the mineral lease. In South Carolina, there may be variations of the Assignment of Overriding Royalty Interest (No Proportionate Reduction), depending on the specific terms and conditions agreed upon by the parties involved. Some common types include the following: 1. Full Assignment: This type of assignment transfers the entire overriding royalty interest to a new party, relinquishing all rights and benefits associated with it. 2. Partial Assignment: Unlike the full assignment, a partial assignment only transfers a portion of the overriding royalty interest to a new party, while the assignor retains a percentage of the interest. 3. Temporary Assignment: In some cases, a party may opt for a temporary assignment, which grants the assignee the right to receive the overriding royalty interest for a predetermined period, after which the interest reverts to the assignor. 4. Permanent Assignment: This type of assignment permanently transfers the overriding royalty interest to the assignee, without any possibility of reversion to the assignor. When preparing a South Carolina Assignment of Overriding Royalty Interest (No Proportionate Reduction), it is crucial to include important details such as the names and addresses of both the assignor and assignee, a description of the lease and the overriding royalty interest being assigned, and any specific terms or conditions related to the assignment. It is advisable to consult with legal professionals experienced in mineral rights and energy law to ensure compliance with South Carolina regulations and protection of the parties' interests. Keywords: South Carolina, Assignment, Overriding Royalty Interest, No Proportionate Reduction, oil, gas, mining lease, energy industry, revenue, mineral rights, assignor, assignee.
South Carolina Assignment of Overriding Royalty Interest (No Proportionate Reduction)
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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.
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.
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.
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.
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 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.
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, ...