How to get a royalty audit in Texas?

First step is careful review of the documentation from the seller, including copies of his royalty checks and his DOI, division orders, deeds, etc. Second is the assignment language, such as limitations to wellbore only or depths, and whether he assigned 100% or a fraction of his interest. If the seller assigned his interests in specific leases, then the landman can help you trace the status of those leases (such as expired or released depths) and which wells were drilled under those leases. Hopefully you have or can obtain copies of the original leases. Whether or not the seller was the original lessor, the landman will need to track the assignments into the seller (and out of the seller) to determine what he owned at the time of your purchase. For example, was an assignment of an override into the seller limited to specific depths or formations. You may also be able to pull the seller’s tax listings from the county CAD to see what wells and DOI he was paying taxes on.

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