MATH QUESTION?

I am no good at math, if I try I usually get a total block so heres my ?s If my unit is in a  acres total 571.994468 and I am suppose to have 17 acres owned for mineral rights how much would that come out to as decimal interest? my husband got 0.00441237 but hes not much better then me at math..  Thanks

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Permalink Reply by Ragnars Repo on November 15, 2014 at 6:45am
0.02972056
Multiply this number by your royalty %
Permalink Reply by Philip Thackray on November 15, 2014 at 6:46am

You need to post your royalty percentage or a decimal interest can not be calculated.

Decimal Interest = Royalty (as decimal) x (your acreage / acreage in unit)

For example if your royalty is 12.5% then

Decimal Interest = 0.125 x ( 17 / 571.994468) = 0.003715071

If you have a 15% Royalty, the Decimal Interest = 0.004458085

Phil

Permalink Reply by DONNA M SELLERS on November 15, 2014 at 6:50am

I have 18%

Permalink Reply by Ragnars Repo on November 15, 2014 at 6:57am
0.02972056 x 0.18= 0.0053497
Permalink Reply by Philip Thackray on November 15, 2014 at 7:03am

"I have 18%"

Good for you!

Phil

Permalink Reply by DONNA M SELLERS on November 15, 2014 at 7:06am

Thank You All...

Permalink Reply by Mike Fulper on November 15, 2014 at 10:10am

Both acreage decimal and % decimal..

THEN  have to be mulitiplied by

MINERAL INTEREST...

If you own all of the mineral interest.. then use 1

if you only own 1/2 of your minerals....multiply by .5

Your ACERAGE % in Decimal is in your UNIT Paperwork...

You don't use 17 acres.....

it has to be 17 acres OF THE WHOLE UNIT of acres of the lateral...

That decimal is in your paperwork...

Your either in a DRILLING UNT... OR PRODUCTION UNIT....

Drilling Unit.. gives you MORE of a % of the lateral...

Permalink Reply by DONNA M SELLERS on November 15, 2014 at 11:10am

good grief.... no wonder people give up and just accept the o&g companies word for everything....most of use are older and have kids, grandkids. and greatgrands...I read all I can and really try to understand but the more I read sometimes the more I realize Ive been out of the loop for to long good God life goes so fast. But I do thank you all and also thanks for not making fun of this old women.....

Permalink Reply by Carl Krebsbach on November 15, 2014 at 11:33am

It does help to have a strong background in math, for sure!  If you are weak in math, find a friend to help (or post your acres, the unit acres, your royalty %, and any complications of ownership (hunting partners, etc) and we'll try to help.

Remember, the figure for your acres needs to be the actual amount of your land THAT IS IN THE UNIT.  A lot of times only PART of the land that someone owns is part of a unit.

Permalink Reply by evan on November 15, 2014 at 9:23pm

A

Permalink Reply by Carl Krebsbach on November 15, 2014 at 11:25am

I just went through that myself.

(your acres that are part of the unit / unit acres) x your royalty rate

If there are multiple owners each getting their own checks, that result is the total of all the multiple owners.  If there are two equal owners (say you and a buddy bought some land to hunt on), then your share is half of that again.  If there are three equal owners, then your share is 1/3 of the total.

If the ownership situation is more complicated yet, say there are two UNequal owners, then you take the total and multiply it by your share of ownership.  Say two owners but you only own 1/3, then multiply the total by 1/3 (which is 0.333 in decimal form).

Permalink Reply by Philip Thackray on November 16, 2014 at 2:01am

The acreage numbers that apply to the Decimal Interest calculation can be found in documents recorded at the County Recorders Office.

In PA the document is "Declaration of Pooling and Unitization".  In Ohio the document is "Declaration and Notice of Pooled Unit".  This document must exist before you can calculate the Decimal Interest.  These are the controlling numbers.

In these documents the total acreage in the unit is defined.  The name of each land owner in the unit is listed along with the number of acres each land owner has in that particular unit.  If you own 100% of the "minerals" the simple equation that has been listed above applies:

Decimal Interest = Royalty % (expressed as a decimal) X (your acreage in the unit / total # of acres in the unit).

It does not matter if a lateral is beneath your property - the "Declaration" documents rule.

One complication, the above documents can be amended at any time thereby affecting your Decimal Interest.

Phil

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