It's been a while since I posted a question here, mainly because the information I got before was so helpful I didn't have any more questions.
I am wondering if anyone is experienced with division orders and can answer this:
We finished probate of our 3.80333333 acres and got our deed, and sent everything to Continental Resources. They sent a packet with a division order. The division order has an ownership decimal of .00049743, which they apparently calculated this way:
3.80333333 acres divided by 1223.36 acre unit = .00310892
.00310892 times .16 royalty = .00049743
Now, we have decided not to lease. There is a producing well in our unit, it was drilled 3 years ago. We were under the impression that if we did not lease, and we did not cut a check to Continental for our share of drilling, Continental would withhold/recover 150% of the initial cost of the well by keeping 84% of each payment.
If we sign this division order stating .00049743 (which incorporates a .16 royalty into the decimal), will Continental automatically change this division order once our 150% is paid off? I want to make sure we aren't inadvertently signing up for only 16% forever if the well ever pays off.
Also, does anyone know if they will withhold 84% from the back royalties, or do we get the entire back royalties and then they withhold 84% after sending us an AFE and us not responding?