My husband has received an offer of $43,867 for his Overriding Royalty Interests in 58.49 net royalty acres in Eddy County, NM. (Sections 2, 3, 9 and 10, Township 19, Range 25.) We were unaware of these interests, have never received royalties and have no paperwork to document his ownership. I have searched Eddy County resources for a title without success…County Clerk, County Sheriff’s Office, property records. Each time I have been told that I’m looking in the wrong place and directed to another office…always with the same result. The lease with which the interests were associated may be long expired, but the wells are still active, and I would like to verify the information. Where should I look for the title and any associated paperwork?
If you searched the records for his name and his family members names(I’m assuming that’s how he received the interest)then you will need to hire a landman to run title for you. Chances are his family got the interest long ago, and would not be online since records only go back so far.
Thank you for your help. The only source I can think of is that, during his college vacations, my husband worked on an oil rig. Perhaps the company offered its workers discounted ORI’s? This would have been late 40’s or early 50’s. The first well was drilled in 1960…still producing, although probably not continuously…then nothing more until the 90’s. (We were married in 1963…no title or royalties at that time, so I’m guessing that the whatever lease may may have existed had already expired.) Again, thanks!
Overriding royalties are linked to a specific lease(s). If the lease expires, then so would the right to overriding royalties. If there has been no break in production over the years (at least one well or another has been producing), then the lease will not have expired. Your husband will have to be in a chain of title in the deed records to own an overriding royalty. That can be directly through a record in his own name or indirectly through a relative through whom he is an heir. Many people do not file probate for an interest which they consider to be worthless and so not worth the cost. So there is no direct record out of that owner and into the heirs. And then no record into the descendants of those heirs. So the landman may have tracked ownership by looking at birth-death records.
Ask the landman who is offering to buy where he got his information regarding title. If he thinks it still has that kind of value, someone has a data trail and royalties may be tied to the ORRI.
I’ve thought of that (asking the landman how he found my husband) but he might be reluctant to share that info only to have me go looking elsewhere for a better price! (Can’t hardly blame him!) Currently the interests are listed for auction with US Mineral Exchange. Ordinarily they want paperwork but, because I have information about the exact location and acreage of the tracts, they will simply stipulate that potential buyers would need to do the research. I am committed to thirty days with the option of renewing every thirty days.
Thanks for your input.
It does get complicated, doesn’t it! It appears that the well that was drilled in 1960 actually has been producing continuously ever since. So maybe the lease does still exist. (I didn’t know that wells could produce that long!) Thank you for your help and suggestions.
If you have an ORRI, then you would want to claim the royalties. The override only exists as long as the lease does. Better to claim them before you sell them, I would think. Otherwise, that is what the other person is trying to get… plus any future royalties from future wells. Yes, I have wells that are still producing from back in 1920!