A Virginia Assignment of Overriding Royalty Interest in Working Interest Owner, Single Lease, Stated Percentage is a legal document that transfers a specific percentage of overriding royalty interest from the working interest owner to another party in relation to a single lease in Virginia. This assignment is often used in the oil and gas industry to allocate royalty interests among multiple stakeholders involved in the exploration and production process. In this type of assignment, the working interest owner agrees to assign a stated percentage of their overriding royalty interest to another party. The overriding royalty interest represents a share of the proceeds from the production of oil, gas, or minerals from the leased property, without bearing the costs and risks associated with the exploration and drilling activities. The assignment is usually made in consideration of monetary compensation or other agreed-upon terms. There can be variations of this type of assignment depending on the specific terms and conditions agreed upon by the parties involved. Some possible variations include assignments with different stated percentages, assignments with additional contractual obligations, or assignments with specific provisions related to revenue distribution or termination conditions. Keywords: Virginia Assignment, Overriding Royalty Interest, Working Interest Owner, Single Lease, Stated Percentage, Oil and Gas Industry, Exploration and Production, Lease Property, Royalty Interests, Production Proceeds, Costs and Risks, Monetary Compensation, Terms and Conditions, Contractual Obligations, Revenue Distribution, Termination Conditions.
Virginia Assignment of Overriding Royalty Interest by Working Interest Owner, Single Lease, Stated Percentage
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FAQ
To calculate the number of net royalty acres I'm selling, I use this formula: [acres in tract] X [% of minerals owned] X 8 X [royalty interest reserved in lease] X [fraction of royalty interest being sold]. 640 acres X 25% X 8 X 1/4 X 1/2 = 160 net royalty acres.
A gross overriding royalty entitles the owner to a share of the market price of the mined product as at the time they are available to be taken less any costs incurred by the operator to bring the product to the point of sale.
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 similar to a royalty interest in that it is also a portion of the proceeds from the sale of production. However, it is not retained under the terms of the oil and gas lease. An ORRI is granted, assigned and created under the terms of a separate document.
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 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.
Overriding Royalty Interests To calculate the ORRI, multiply the gross production revenue by the ORRI interest percentage, and the figure gotten is what the ORRI owner is entitled to.
A gross overriding royalty entitles the owner to a share of the market price of the mined product as at the time they are available to be taken less any costs incurred by the operator to bring the product to the point of sale.
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.
How to calculate the overriding royalty interest? ORRI = NRI * 5 percent. $750,000 * 0.005 = $3,750.
