Does anyone knows what tract factor means on division orders it has numbers?
TL,
A tract participation factor is determined by your mineral interest divided by the number of surface acres in a unit. For example, if you own a 1/2 interest in 60 acres and the unit size is 704 acres and your royalty percentage is 25%, then the math is as follows:
TRACT PARTICIPATION Mineral Interest divided by Surface Acres in the Unit.
(1/2 * 60)/704= 0.0426137 (Tract Participation Factor)
REVENUE INTEREST Tract Participation x royalty interest
0.0426137 x .25=0.01065341 (Share of production)
This assumes that your mineral interest is not subject to any burdens, such as a previously reserved non-participating royalty interest.
Best Buddy Cotten
Thank you, Sir, for your reply
TexasLady,