Property in 2 units

So I have 30.5265 acres in a unit of 604.71 acres that is already producing. My decimal interest at 17% is 0.0085818 for the west unit. I just received division orders for the south west unit that is 498.61. The 2 units over lap 92.8675 acres. Range Resources says my decimal interest is 0.00159838. There formula is 92.8675/498.61*.0085818. They are saying that since I'm already in a unit that I have to share with the whole unit. Is this how this works? I would think I would get paid separate from each unit for my acres that I have in each unit.

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Permalink Reply by Joseph-Ohio on May 23, 2015 at 11:25pm
BTW, I think I finally understand that Mlmc3475 only has one (1) lease on his 35.5265 acres and that there are two (2) royalty % specifications within the lease (12.5% / 17% - based on the depth of any developed well).

Based on all that's been written here, I also think that I understand that 17% of the acreage pro-rated share prevails in Mlmc3475's lease.

IMHO, the E & P new overlap condition math should not trump the Mlmc3475 lease agreement - in agreement with Mlmc3475's perspective / calculations as apparently there is no lease agreement that supports the change.

Want to know how this one shakes out - but it will probably be a long time before we find out.
Permalink Reply by Joseph-Ohio on May 24, 2015 at 11:33pm
Also BTW, I've read / heard of more than one lease on a single parcel of land for gas and oil well development.

The discussions considered 'strata specific' leasehold agreements.

Am I the only person who has heard of such; or are there others out there also ?
Permalink Reply by gary SWF on May 25, 2015 at 12:43am

I think in the perfect world you want to have a  separate/different lease for each strata. Such as a lease specific for the Marcellus,.....one specific for the Utica and etc, to cover each and all of the stratas. I believe these leases are elevation specific. Maybe one states from 4500 feet to 4800 feet below surface and etc. I believe this is quite common........ALL IMHO.....GarySWF   

Permalink Reply by Joseph-Ohio on May 25, 2015 at 1:43am
Wondering if you've heard / read that it has in fact been applied ?

I think it's smart too.

Nearest to it I've read about is Mlmc3475 here, as it reads like his lease covers all strata, but royalty is paid differently dependent on depth.

That's the way I read it anyway.
Permalink Reply by gary SWF on May 25, 2015 at 3:04am

I am quite sure what I said has been applied......and from a land owners point of view the best way. I am quite sure some/most Energy/Driller Company would prefer a lease that has all rights to the center of the Earth. I personally would not sign that type of lease.......Deal with each strata separately.......A separate "singing bonus" ,"surface rights" and etc. for each strata. I believe the land owner should stay in control when and where ever possible. I also doubt that all drillable strata have been identified at this time.......ALL IMHO

 
 

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Permalink Reply by Joseph-Ohio on May 25, 2015 at 9:22am
Thank you for the information gary SWF.

I appreciate it.

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