I’m looking for some “technical” feedback—ideally from a DOA or someone familiar with Oklahoma 52 O.S. § 87.8 (which regulates allocation between multiunit sections).
Posts regarding multiunit production allocation have appeared in this forum in years past, however I hope responses to this much newer and more specific post will help clarify the “allocation issues” many Oklahoma mineral owners continue to face as multiunit wells have become even more popular recently.
I own 5.00 NMA in 12-14N-21W of Roger Mills County, OK leased at 1/5. These mineral rights are included in a recent Mewbourne Cherokee multiunit well (Donny 1H) consisting of sections 1 and 12 of 14N-21W. My minerals are in the southern section (12). I’m happy with the operator, but I have a question about my decimal.
My first several payments were based on a decimal of 0.00078125. This reflects a “perfect” 50/50 split of the 1,280-acre unit.
The math: 5/1280 X .20 = .00078125
The Issue: I pulled the Form 1002A (Completion Report) containing the as-drilled survey data for this well. Per the 1002A the perforations run from 11,544’ to 21,405’. Based on the footage, the southern section contains roughly 67% of the productive interval, while the north has only 33%.
Under 52 O.S. § 87.8, shouldn’t the allocation be based on the Statutory Allocation Factor (the perforated length per section)? If so, my decimal should be:
5/640 X .67 X .20 = .00104688
That is a 34% difference. QUESTION: Is it common for operators to use a 50/50 placeholder initially, even when the filed 1002A implies it’s not 50/50? Will they “get around” to correcting the decimal to reflect the 67% allocation to my section 12 (assuming I’m right) or do I need to send them a polite reminder? They’ve not sent me a division order yet (the well is still fairly new).
Appreciate any insights! Am I wrong on the 67% allocation? Why?