Division Orders - Difference in NADOA Model 2017

Ownership and Title
1

I’ve filed and had recorded the appropriate Gift Deeds changing title to my Living Trust - I am Trustee. I have contacted and sent all documentation requested by the Royalty Owners departments, i.e., copies of the Gift Deeds, Trust, and the original Division Orders. I have now received my first new DO. To prepare, I have a copy of my original DO from 2003 which was amended according to model DO from NODOA. I have also printed out the new NODOA Model Form DO as Amended 1/17. The provisions seem quite different and much shorter. Can anyone comment on this?

Also, the DO provided to me by the production company has a TERMS OF SALE clause which I plan to delete. Also, it has a DEFAULT Clause, which I plan to delete.

Thanks for the advice, just looking to keep my knowledge up to date.

2

In which state are the minerals located? Some states have statutory forms. In Texas, it is possible for the division order to amend the oil and gas lease as long as the division order is in effect. You will get better comments with more information.

1 Like
3

Strictly speaking, Oklahoma does not require a division order, but I like to review them for percentages. You still must provide a W-9.

4

Sorry, I meant to say the minerals are all in Texas!! Thanks for picking that up! I do not want to execute anything that would amend the provisions of the lease as we have worked hard to have quality leases. Thanks again, Meg

5

Although it’s true that Texas has a statutory form, we need to remember that a Division Order is nothing more than instructions from you to the oil company (or purchaser) on how you wish the monies to be sent to you and in what decimal amount.

Having said that, you can do what you wish with a Division Order, including putting in a statement that nothing in the Division Order supersedes any provision to the lease form. Actually, that is Texas law as well. In the future, you can include in your lease form that you both agree that the execution of a Division Order is not needed to place your interest in line for payment.

Best,

Buddy Cotten

6

Thank you so much for the reminder and comments! Will get this off my desk!