America’s conversation place for mineral owners
Just received division orders from Carreera Energy and a little confused on the interest payment. I own 160 acres of mineral rights in this section with a lease at 3/16th. but the orders indicate a .04687500 what am I missing?
The formula is net acres/spacing acres x royalty x % of perfs in your section.
You have 160/640 x .1875 x 1.0 (single section well) = .25 x .1875 x 1.00 = 0.046875.
Your Division order is correct. If it comes up a bit off sometimes, the first place I look is to see whether the section is truly 640 acres (many of the first row and west column of sections are not always a pure 640). The second place to check is the true percent of perforations in your section if a multi-section well. It is not always 50%. In your case, you have a single section well, so it is 100% or 1.0. You are correct in all terms of the equation.