Royalties split by your acreage? Or not?

I've read a million times how your share of royalty is split by % acreage you own in a unit, and have also seen all the royalty calculators that use that same figure, but, I've been hearing lately that the unit is sectioned off in a grid. Where the horizontal goes through the grid is how the royalty is then calculated. If that's the case, depending on the angle of the well and the orientation of your land relative to the grid, you may be looking at quite different numbers? I can see how this could be better for some and not so good for others (which would be my case). Has anybody heard or seen this?

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Permalink Reply by craig on November 15, 2011 at 1:28pm

The key is "acreage you own in a unit". Depending upon your lease and how your land lies you most likely will have just part of your acreage in a unit. So yes, it happens all the time in PA anyhow. 

Permalink Reply by redbank on November 15, 2011 at 1:40pm

All of my land is in the unit. In fact, our unit is almost split 50/50 with the other landowner, and there is only the two of us. It's the shapes of the properties and the angle of the laterals that has me thinking. Actually, it is probably more fair with the grid system, but my particular layout would have me on the "wrong" side of things.

Permalink Reply by craig on November 15, 2011 at 3:24pm

Are you sure that all of your land is in the declared unit?

If all of your land is in the declared unit then you will get royalties based on every acre...... Doesn't matter where the horizontal goes. That's how it is working in  our area of PA. I am in an area where the parcels may vary from a few acres to 200+ acres. I can tell you from looking at a few declared units ( ie filed with the county courthouse) that close to 50% of the parcels have some fraction of their land in a unit. 

I just got this from our counties website to show you what i mean:

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