Being new to this EF oil business, I’m hoping Clint or someone can tell me how royalty payments are figured. We were told yesterday by a landman with the oil company who has our lease that the wells around our lease in Atascosa County have been producing around 300 BOPD for the last two years…the production hasn’t declined. We don’t understand… When our wells come in and if producing at that rate and getting 18% with around 10 people pooled in the unit…how is the royalty payment per individual figured?
J. Michal:
Here's a quick way to get your calculation. First google Mantra Land Services, Oil and Gas Calculator; Just fill in the blanks with the following info: Number of Acres in the Spacing Unit, Net Mineral Acres Owned, Your Royalty %, Dailey Production (bopd), Price per Barrel, hit CALCULATE. Instead of taking time to write the process, this way is much easier.
Thank you, Charles, have been wondering about this for a long time and finally thought about asking the question on this forum… a very interesting calculation…and it really was easy.
Charles, or anyone, one more question about how royalty payments are figured…I went to Mantra Land Services and got the calculated royalty figures, but is that figure then divided by the number of people in the pool?
It is the number of acres that each person has in the unit that matters, not the number of people in the unit.
J Michal:
If you own 20 net mineral acres with other family members in say an undivided interest (read your mineral paperwork), you would figure on the 20 nma which is what you own. The figure you get at the calculator website would be what you are paid. Keep in mind on this oil and gas calculator, you have to know what was paid for the oil when sold and transportation charges (if applicable), etc. This site will give you a ball park figure.