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Basic Information

for the

Oklahoma Royalty Owner

Prepared by:

Oil & Gas Complaints & Information Department

Consumer Services Division

Oklahoma Corporation Commission

(405) 521-2613

Last Revision – November 19, 2010

1

Basic Information for the Oklahoma Royalty Owner

This information was prepared by the Oil & Gas Complaints & Information

Department within the Consumer Services Division of the Oklahoma Corporation

Commission. The information is general in nature and does not specifically relate to any

particular case or hearing conducted at the Commission. Any subsequent rule change or

legislative change after the effective date of this booklet, November 19, 2010, could alter

the information included. We suggest that you consult your own attorney for specific

answers if you have a particular legal question or any pending litigation rather than

relying on the general information included in this booklet.

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Table of Contents

Basic Information

3

Frequently Asked Questions

about Horizontal Drilling 12

Helpful Telephone Numbers

16

Calculation of Royalties Under

SB 168

17

OCC County Codes

18

County Contacts

19

Section Platt with Footages

28

United States Land Survey

System

29

OCC Database Instructions

Well Browse 31

Operator Browse 33

Imaged Records Access 34

Case Processing 35

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Basic Information

Hearings at the Corporation Commission:

Court Rooms at the Oklahoma Corporation Commission are located on the first

and third floors of the Jim Thorpe Building, southwest of the Capitol on Lincoln

Boulevard in Oklahoma City, Oklahoma.

Hearings at the Corporation Commission are posted on the first floor of the

building on a bulletin board and on the OCC website at www.occeweb.com. The weekly

docket is posted on Wednesday for the following Monday through Friday. The daily

docket is posted the day before the hearing. Usually there are over 100 hearings posted

with courtroom assignments, so it is important that you know which one involves your

land. The cases are posted according to the case number, applicant and county; therefore,

it is important that you bring that notice with you in order to find your case and

courtroom.

Finding your courtroom:

Six courtrooms are located on the first floor of the Jim Thorpe Building and

Courtroom 301, where Commission en banc hearings are conducted, is located on the

third floor. It is important that you arrive at the Commission well before 8:30 a.m. to find

the courtroom to which your case has been assigned.

Calling the docket:

Once you have reached your courtroom, the Administrative Law Judge, at 8:30

a.m., will call the assigned cases for that day. The Administrative Law Judge will call the

case number, the applicant, the type of case and the county. Often each Administrative

Law Judge will have over twenty cases assigned to hear that day. When your case is

called, announce your presence in the courtroom and let the judge know if you have an

attorney or are representing yourself and if you are opposed to the application or not.

Due to the large number of uncontested cases that must be heard, usually protested cases

must be scheduled on days that are specifically set aside to hear protested cases. Parties

involved in a protested case must complete a pre-hearing conference agreement setting

forth issues and establishing the trial date. If the parties cannot agree upon a date, the

judge will select a date.

What is spacing?

A drilling and spacing order issued by the Corporation Commission joins together

certain oil and gas reservoirs within a legally described boundary so that any well drilled

within that drilling and spacing unit must have its royalty shared with all the mineral

owners within the unit. The oil and gas reservoirs are called “common sources of

supply” and several different sources of supply may be spaced in the same order. Often

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the names of these reservoirs become very important during the hearing. This spacing

order communitizes or joins together the royalty interests within the boundaries of the

unit.

Number of wells that can be drilled in a unit:

Once the drilling and spacing unit has been created, only one well can be drilled

to the common source of supply. The order will also specify the area where the unit well

may be drilled. Under certain circumstances, additional wells may be drilled, but only

after an application is filed, a hearing conducted, and an Increased Density Order is

issued by the commission.

Drilling and spacing units:

Below is a list of the standard sizes for drilling and spacing units and the

permitted locations within the unit for the well to be drilled.

The well can be located no closer to the unit boundaries than this:

Square Units: Rectangular Units:

640 acres 1,320 feet 320 acres 660 feet

160 acres 660 feet 80 acres 330 feet

40 acres 330 feet 20 acres 165 feet

10 acres 165 feet

Horizontally drilled wells often require a Location Exception Order from the

Commission and have different requirements for well location. Horizontal wells are

sometimes designated by an “H” in the well name, such as Smith #1H-10 or Smith #1-

10H.

What is a Pooling Order and when is it necessary?

After the drilling and spacing order determines the boundaries of the unit and the

reservoirs involved, any person or company owning the right to drill a well within the

unit may propose the drilling of a well. After the oil company has proposed the well, the

company will try to reach agreement with all the other owners within the unit (do they

want to lease to the company who wants to drill, or do they want to join in sharing the

cost of drilling the well and thereby own a working interest in the well?).

If the oil company cannot successfully get all the owners within the unit to agree

as to how to develop the unit, the oil company can apply to the Commission to have those

people or other oil companies who have not agreed, force pooled into the unit. “Force”

pooling means that under Oklahoma law the oil company can force those who are

undecided to make a decision.

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Fair market value:

At the pooling hearing evidence will be taken to establish what prices have been

paid for leases within the subject unit and the eight offsetting units. The nine-unit area is

the area the Commission usually considers in determining the value of leases. The

Commission wants to find the best evidence of the fair market value of the land involved.

Often the best evidence is the highest amount, but sometimes the best evidence is not the

highest amount. Each case must be judged on the individual facts presented.

Cash bonus elections under the Pooling Order:

After the pooling order is issued, all of the parties will have 20 days to choose or

elect which financial options they wish to make. The pooling election must be made in

writing within the allotted time. If a royalty owner chooses to take the cash bonus and

royalty percentage that goes with it, the order will state how many days the oil company

has to pay the cash bonus. The cash bonus must be paid to those who elect it even if the

well is never drilled or if drilled and is a dry hole.

If the oil company does not properly pay the cash bonus, the poolee that is unpaid

must sue in District Court to obtain the money. The Commission has no jurisdiction or

authority to force the company to pay the cash bonus.

Elections to participate in the drilling of the well under the Pooling Order:

Anyone electing to participate and join in the costs of drilling the well will be

given a certain number of days to submit their share of the drilling costs or to make

satisfactory financial arrangements for payment. The pooling election must be made in

writing within the allotted time. Letters of credit are often accepted rather than cash

payment up front, but the arrangements are different for each situation and parties

involved depending on their financial position and experience in the oil business.

Deemed elections:

If you fail to make a timely election under the pooling order, the order will

provide that you are deemed to have made a certain election. Normally, if a party fails to

elect or elects out of time, the order will provide that he is deemed to have elected the

cash bonus and royalty.

If any person elects to participate, but fails to submit his share of the drilling costs

or make timely financial arrangements with the oil company, the pooling order will also

state that party’s election is rescinded or voided and the party usually will be deemed to

have taken the cash bonus.

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Leasing under a Pooling Order:

Any person who is listed as a party in a pooling application and order may still

lease to anyone until the 20 day election period listed in the pooling order has run.

Term of Pooling Order:

A pooling order usually, but not always, provides a maximum of 180 days to

commence a well. If the operator of the well does not commence operations within 180

days, the pooling order is void. It is not mandatory that the well be drilled at all,

however, cash bonuses are due to those electing the cash regardless of whether a well is

drilled or not. In some cases, the Commission may grant an extension of time under the

pooling order, however, the applicant is sometimes required to pay some percentage of

the original cash bonus again, but usually there is no new election.

Lease disputes:

The Commission has no jurisdiction or authority over lease disputes. Any

problems or questions you have with regard to a leasing problem should be discussed

with the person or company you leased to or with your attorney.

Lawyer Referral Service:

Lawyer Referral Service is no longer available from the Oklahoma Bar

Association, however, you can find a listing of attorneys by category on the Bar

Association website at www.okbar.org. Also, refer to your yellow pages directory for

“Attorney Referral Services”.

Oil &Gas Complaints & Information:

The Commission has an Oil & Gas Complaints & Information Department

located on the fifth floor of the Jim Thorpe Building. Additional questions and concerns

can be sent to them by mail or you may call them at (405) 521-2613.

Oklahoma Corporation Commission District Field Offices:

District I Bristow (918) 367-3396

District II Kingfisher (405) 375-5570

District III Duncan (580) 255-0103

District IV Ada (580) 332-3441

The ABC Oil Company wants to put a saltwater disposal well on your lease. What

information do you need?

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The first thing you should do would be to check your lease to see if the lessee is

allowed to put a saltwater disposal well on your lease. Any action involving the lease

would need to be filed by a privately hired attorney in District Court.

If you have some reason to believe the proposed saltwater disposal well would be

unfit to be used as an injection well or would constitute a danger to fresh water supplies

or oil or gas bearing formations, then you may file a formal protest with the Underground

Injection Control Department within fifteen (15) days after the applicant’s publication of

its intent to have a saltwater disposal well. Under rule 165:5-7-27, the applicant must

mail a copy of the application to the surface owner of the land on which the proposed

well is to be located.

XYZ Oil Company drilled a well on your property over a year ago, but has not

produced the well or filled the reserve pit. What can you do about this situation?

Under rule 165:10-7-16 the time frame for the closure of a pit is dependent on the

category of the pit. The appropriate District Office can make a determination. Under

rule 165:10-11-3, any well which has production casing in place shall be plugged within

one year after cessation of production, unless there is at least one producing well on the

same lease. This rule does not apply to a shut-in gas well. A newly drilled well, in which

surface casing has been properly set, must be plugged within ninety (90) days after the

cessation of drilling or testing. The plugging rule has been amended recently; it is

lengthy and complex, and should be scanned carefully to see how it applies in each

individual case. If a well should be plugged or a pit emptied and leveled, then the field

representative of the Commission should be called and a Complaint Notice issued to the

operator. Should the operator fail to comply with the requirements of the Complaint

Notice, then a formal application may be filed and set for hearing on the Pollution Docket

to require compliance. The Pollution Docket is held every Wednesday and Friday at 8:30

a.m. at the Commission.

You own the mineral rights in a well located in a certain section in a county in

Oklahoma. The “Z” Petroleum Company takes the oil from this well and sends you

checks and statements periodically. How can you tell if you are receiving the proper

amount of money and that the stated amount of oil withdrawn is accurate?

The Oklahoma Tax Commission (405) 521-4558 has the records on gross

production, including volumes and values, from individual wells because they are

responsible for collecting state production taxes on any oil or gas produced in Oklahoma.

The figures given to you by your oil company should match those reported to the

Oklahoma Tax Commission. The Oklahoma Tax Commission can provide information

regarding volumes and values of production sold.

8

Gas volumes can be found on the OCC website at www.occeweb.com. Oil

volumes for wells that are classified as oil wells care only available by accessing the

actual production reports in our Document Image Access database. To do this you must

know the Production Unit Number that was assigned to the lease by the Oklahoma Tax

Commission, and the purchaser number. Production values are not available on the OCC

website.

Title 52 Oklahoma Statutes 87.1(b) may provide assistance in getting a portion of

your lease released.

Example: You own the entire NW/4 of Section 21, Township 22 North, Range 9

West, in a particular county in Oklahoma, and also the N/2 SW/4 of the same section.

You lease all of these 240 acres to a particular oil company on one lease. The oil

company drills a producing well on the northwest quarter, but when the lease period is

up, the oil company intends that this well also holds the 80 acres in the southwest quarter,

although the spacing is 160 acres. Does this well indeed hold the entire lease, or should

you have release on the south portion?

52 O.S. Section 87.1(b) states: “in case of a spacing unit of one hundred sixty

(160) acres or more, no oil and/or gas leasehold interest outside the spacing unit involved

may be held by production from the spacing unit more than ninety (90) days beyond

expiration of the primary term of the lease.”

This law became effective May 27, 1977 and may or may not apply in your case

depending on the date of your lease. It would be advisable to check with your attorney

for an interpretation of this law as it relates to your particular facts and situation. The

Commission has no jurisdiction to release a portion of your lease.

How do you determine if there has been any production on your land?

Example: Your grandfather died, and among his papers you found a mineral

deed signed in 1949 indicating that he owned 50% of the minerals under the described

land. Has there been production on this land, and where do you go to get the money?

The Corporation Commission does not determine who is the owner of mineral

rights. This should be a matter of record in the courthouse of the county where your land

is located and the Tax Commission’s records may also help. You may need an attorney

to research this for you. We can advise you as to the possible existence of a well on the

legal description in question, but we do not have any records reflecting where the lessee

would have deposited any money owing to your grandfather.

Surface rights versus the rights of the oil operator:

Example: My wife and I bought ten acres of land, surface rights only, to serve as

our retirement home. We have planted an orchard and improved it in general. Along

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comes an oil company, who tells us that they are going to drill a well in the middle of our

orchard. Can they do this?

If you owned the surface rights only and the location to drill the well the operator

has chosen on your land is in compliance with Commission regulations for well locations,

the oil company can go ahead and drill on the location they chose. However, 52 O.S.

Sections 318.2 through 318.9, requires certain negotiations between the oil company and

the surface owner with regard to surface damages. You should contact your attorney to

ascertain if the oil company is complying with the Surface Damages Act. The

Corporation Commission has no jurisdiction or authority over surface damages or any

direct relationship with this law.

Well placement for unspaced lands:

Commission rule 165:10-1-21 is the regulation which addresses well locations on

unspaced lands. As long as the well complies with these limits, the only other restriction

would be any private agreement such as a lease that states how many feet from structures

such as homes or barns, the well must be located.

“Any well drilled for oil or gas to an unspaced common source of supply 2,500

feet or more in depth shall be located not less than 330 feet from any property line or

lease line, and shall be located not less than 600 feet from any other producible or drilling

oil or gas well when drilling to the same common source of supply; provided and except

that in drilling to an unspaced common source of supply that is less than 2,500 feet in

depth, the well shall be located not less than 165 feet form any property line or lease line,

and not less than 300 feet from any other producible or drilling oil or gas well in the same

common source of supply; provided, however, that the completed depth of the discovery

well shall be recognized as the depth of the common source of supply for the purpose of

this rule; provided further, when an exception to this rule is granted, the Commission may

adjust the allowable or take such other action as it deems necessary for the prevention of

waste and protection of correlative rights.”

An oil company has drilled on my land and, having completed the well, moved away

leaving considerable inactive equipment as well as all sorts of trash and debris. Can

they be made to clear the site?

Under rule 165:10-3-17 all surface trash and debris must be removed from the

premises. With the surface owner’s permission the operator may bury non-hazardous

material including cement bases. This rule does not apply to Osage county.

Although the pit has been filled on my land, the road is rough and rutted. This land

is unusable as is. Can I make the company restore the surface and sow grass seed?

Under rule 165:10-3-17 the area of the road is to be restored to as near to its

natural state as reasonably possible and a bona fide effort must be made to restore the

vegetative cover within 180 days after abandonment of the property.

10

My operator refuses to place a fence around my well. He also refuses to install a

cattle guard. The pumper always leaves my gate open, and my cattle get out. Can

the Commission do anything about this?

Commission rules do not demand fencing of a well, neither do we have authority

over cattle guards and/or gates. Surface issues can be addressed in an addendum to the

oil and gas lease or in the surface damage agreement. If the well is within city limits, city

ordinances may require fences.

How close to my house may a well be drilled?

Commission rules have no restrictions concerning distances from a residence.

Study your lease. Many leases will stipulate that a well may not be located closer than

200 feet to a house or barn. If you do not own the mineral rights, check at the county

courthouse and see if you can look at the lease, which should be filed there. Also, if you

live within the limits of a city, there may be an applicable ordinance.

52 O.S. Section 318.10 was passed in May 2003 and states that it is unlawful to

locate a habitable structure within one hundred twenty-five feet of an active well or

within fifty feet of any surface equipment without a written agreement between the

surface owner and the well operator specifying different distances.

The well on my property has been completed for some time, but I have heard

nothing concerning it. I think it is producing, for there is a Christmas tree and

storage tank, but I have received no check. How long must I wait until I am paid?

Payment of proceeds is covered under O.S. 52 Section 340, which in essence calls

for payment to be made within six months from the date of first sale, or indicates that if

not, some interest may be due. The Commission has no power or function over payment

of proceeds. The power lies in District Court.

I have received a copy of an intent-to-drill on my land, but I have never signed a

lease. This intent has been approved by the Corporation Commission. How can

you approve an intent under these conditions?

Since the Corporation Commission has no jurisdiction in the area of leases, the

validity of a lease would not have any bearing on the approval of the intent. Approval is

based only on the items appearing on the intent, which are within the jurisdiction of the

Commission.

I have received a division order from the oil company: They asked me to sign and

return it. Can you help me determine if my interest as given therein is correct?

A division order stipulates the percentage of royalty that one owns, and is the

instrument by which the oil company makes payment of proceeds. The royalty owner

11

should ascertain that his or her percentage is correct before signing. If uncertain, they

should contact their attorney, banker, or some knowledgeable source. The Corporation

Commission has no function with division orders and will not become involved in this.

The mathematical formula for determining your division of interest (DOI) is

provided on page 17.

The oil well on my land has stopped producing and has been abandoned. Please

send me a release of my lease.

The Corporation Commission has no function whatsoever with leases, and we

cannot release your lease. For this, you should contact the operator of the well. 41 O.S.

Section 40 relates to the release of leases.

The Commission can issue a Certificate of Records Search under certain

circumstances, which may be filed for record in the county where the land lies. Often, if

the lessor cannot be located, this instrument can help in obtaining a release of a lease. At

this time, the cost for such a certificate is ten dollars per quarter section or section

thereof.

Can I find information about my well on the internet?

Basic well information is available on the OCC website at www.occeweb.com.

Database instructions are provided on pages 31 - 35 of this booklet.

There are also private internet resources you can access for a fee.

How do I get unclaimed royalties that have been turned over to the State?

Contact the Unclaimed Property Department at the State Treasurer’s Office at

45445 N. Lincoln Blvd., Oklahoma City, OK 73105, (405) 521-4273.

There are several websites you can search for unclaimed property in all states.

http://www.web.com/

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Frequently Asked Questions About Horizontal Drilling

What is horizontal drilling?

Oklahoma Corporation Commission rules define a horizontal well as follows,

"Horizontal well" shall mean a well drilled, completed, or recompleted in a manner in

which the horizontal component of the completion interval in the geological formation

exceeds the vertical component thereof and which horizontal component extends a

minimum of 150 feet in the formation.

More simply, a horizontal well is one in which the lower part of the wellbore runs

parallel through the producing formation rather than perpendicular to it as in conventional

vertical drilling.

Why is horizontal drilling done?

Greater recovery of oil and gas can be achieved by drilling a mile horizontally

through a formation than by drilling vertically through it. Generally speaking, it is less

expensive to drill one horizontal well than several vertical wells.

13

In which formations or common sources of supply is horizontal drilling usually

done?

Formations with low porosity and permeability are candidates for horizontal

drilling. For example, the Woodford Shale in Oklahoma. Horizontal drilling is also

becoming more common in conventional reservoirs.

How is horizontal drilling done?

A horizontal well begins by being drilled vertically, then, at a certain depth the

crew begins building a curve using a steerable drill bit that results in a horizontal

wellbore in the target formation.

How many laterals can one well have and how long can they be?

There is no limit to the number of laterals that one horizontal well can have.

They must be at least 150’ but can be any length as long as they do not extend beyond the

legal location of the spacing unit. Currently, the longest lateral drilled in Oklahoma is

approximately 10,000’ in length.

If a horizontal well has more than one lateral, is that considered one well or is an

increased density order required?

Multiple laterals extending from a single wellbore to the same surface location are

considered one well and do not require an increased density order.

Laterals extending from a different surface location and/or a different well bore

into the same horizontal spacing unit in which there is already a producing horizontal

well would require an increased density order. Likewise, a horizontal well drilled into a

regular spacing unit in which there is already a producing well in the same common

source of supply requires an increased density order.

How do you know the horizontal wellbore goes where the oil company says it does?

The oil company is required to submit a directional survey with the well

completion report to the OCC for all horizontally drilled wells showing the location of

any point of the wellbore as it relates to the surveyed surface location from the surface to

the terminus of each lateral.

14

What about allowables? If a horizontal well with several laterals is considered one

well, is just one allowable assigned to all the laterals?

Yes, one allowable is assigned to a horizontal well with multiple laterals in the

same spacing unit; however, multiple horizontal gas wells in the same unit each have

their own allowable.

Is horizontal drilling done all over Oklahoma or just in some areas?

Horizontal drilling in Oklahoma is done all over the state but less in the

northeastern part than in other areas.

Is horizontal well spacing different from conventional spacing? How is it different?

Horizontal well spacing is different from conventional spacing in that the

setbacks, or legal well locations, are different for horizontal wells than they are for

vertical wells. For example, in a regular 640-acre square spacing unit, the legal well

location must be 1320’ from the section line. For a horizontal 640-acre spacing unit, the

legal well location is 660’ from the unit boundary.

Commission rules also specify setbacks for different size units and for distance

between wells in the same formation. Certain geographical areas within the state have

special field rules for closer setbacks for horizontal wells.

How big or small can a horizontal spacing unit be? Does it have to be square or

rectangular like other spacing units? What is an irregular spacing unit?

In Oklahoma, horizontal well spacing can be the same size as any other spacing

unit from 10 to 640 acres in a square or rectangular shape. Irregular 640-acres horizontal

units have been created by stacking two 320-acre units, creating a rectangular 640-acre

unit that is one-half mile wide and two miles long.

There is a horizontal spacing unit on one side of my acerage and another one on the

other side but my minerals were left out. Why did this happen? Is this fair?

The oil company probably determined that the geological evidence they gathered

indicated that this was the best way to establish the spacing units to allow them to recover

the greatest amount of oil or gas.

Irregularly shaped, non-square or rectangular, spacing units could be created to

include “orphaned” acreage, but may not be done if not shown to be geologically feasible

or productive. It might not be fair to the mineral owners in a producing unit to include

non-producing acreage into the unit and, therefore, diminish their percentage interest in

the total unit.

15

Why is a horizontal well allowed to be so close to the section line or unit boundary?

Could my minerals be drained by a well outside my unit or could my well be

draining my neighbours minerals?

Typically, a horizontal well does not drain from as great a distance from the

wellbore as a vertical well does so horizontal wells are allowed to be closer to each other

and to the section line than are conventional vertical wells. Every effort is made to

protect correlative rights of the mineral owners and to prevent a well from draining an

adjoining unit.

There is a horizontal well on my land but my minerals haven’t been leased and I

don’t receive a royalty. Why not? Why does the oil company have the right to drill

through my minerals for a horizontal well and not pay me?

Many horizontal wells have a surface hole location (SHL) in one section and one

or more bottom hole locations (BHL) in another section. The interest owners in the

spacing unit from which the well drains receive the royalty from a horizontal well. If you

own the land on which the drilling rig is placed, the oil company must negotiate and

compensate you for surface damages before drilling

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Helpful Telephone Numbers

American Royalty Council (405) 360-4600

Certificate of Records Search/Non-development (405) 521-4125

Geomap (713) 520-8989

Gross Production Tax Department/Oklahoma Tax

Commission

(405) 521-3233

Herndon Map Service (405) 946-5858

Liquid Propane Gas Administration (405) 521-2458

National Association of Royalty Owners (918) 794-1660

OCC Administrative Law Judges (405) 521-2756

OCC Court Clerk (405) 521-2351

OCC Field Operations (405) 521-2240

OCC Petroleum Storage Tank Division (405) 521-4683

OCC Intent-to-Drill Applications (405) 521-3070

OCC Office of General Counsel (405) 521-2255

OCC Oil & Gas Complaints & Information (405) 521-2613, (800) 522-0034

OCC Oil & Gas Division (405) 521-2302

OCC Pipeline Safety (405) 521-2258

OCC Public Utility Complaints (405) 521-2331, (800) 522-8154

OCC Transportation Division (405) 521-2251

OCC Well Records Department (405) 521-2275

Oil-Law Records (405) 840-1631

Okie One-Call (800) 522-6543

Oklahoma Attorney General (Consumer Complaints) (405) 521-4274

Oklahoma City Association of Petroleum Landmen (405) 840-4111

Oklahoma City Geological Society (405) 236-8086

Oklahoma City Geological Society Library (405) 235-3648

Oklahoma Commission on Marginally Producing

Wells

(405) 604-0460

Oklahoma Energy Resources Board (405) 942-5323

Oklahoma Mineral Owners’ Association (405) 848-2000

Oklahoma Securities Commission (405) 280-7736

Oklahoma State Bureau of Investigation (405) 848-6724

Oklahoma State Treasurer’s Office/Unclaimed

Property

(405) 521-4273

Oklahoma Tax Commission Oil & Gas Research (405) 521-4558

OU Log Library (405) 447-3118

Pangaea (405) 341-0474

Pennwell Maps (918) 835-3161

Riley’s Electric Logs

(now known as A to D Technology)

(405) 848-4407

Sooner Well Log Service (405) 848-3001

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Calculation of Royalties under SB 168

The following example assumes a 640 acre drilling and spacing unit with interests

described as follows:

Acres Gross Interest

GROUP A: 1/8th

lease for E/2 320 .50000

GROUP B: 1/4th

lease for W/2 320 .50000

Total 640 1.0000

NET REVENUE PROPORTIONATE

INTEREST* PRODUCTION

INTEREST

Working Interest A: .4375000 / .8125000 =

.53846150 Working Interest B: .3750000____________ / .8125000 = .46153850

.81250000 1.0000000

Royalty Interest A: .0625000 / .1875000 = .3333333

Royalty Interest B: .1250000_____________ / .1875000 = .6666667

ROYALTY SHARE SUB-TOTAL .1875000

1.000000

TOTAL NET REVENUE: 1.000000

Each sale generates a ROYALTY SHARE, which is distributed proportionately to

each royalty owner according to his PROPORTIONATE ROYALTY SHARE.

Each working interest owner, who produces its PROPORTIONATE

PRODUCTION INTEREST, produces approximately his net revenue interest under the

Blanchard Decision. However, full communitization of royalty results in re-weighting

of proceeds, if: (1) a spacing unit has multiple tracts; (2) at least one tract has excess

royalty, i.e., royalty greater than 1/8th

of 8/8ths; and (3) gas prices vary significantly

among working interest owners.

*Calculation of NET REVENUE INTEREST:

Working Interest Owner A: 7/8ths x 320/640 = .43750

Royalty Interest Owner A: 1/8th

x 320/640 = .06250

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OCC County Codes

County Code County Name County Code County Name

001 Adair 079 LeFlore

003 Alfalfa 081 Lincoln

005 Atoka 083 Logan

007 Beaver 085 Love

009 Beckham 087 McClain

011 Blaine 089 McCurtain

013 Bryan 091 McIntosh

015 Caddo 093 Major

017 Canadian 095 Marshall

019 Carter 097 Mayes

021 Cherokee 099 Murray

023 Choctaw 101 Muskogee

025 Cimarron 103 Noble

027 Cleveland 105 Nowata

029 Coal 107 Okfuskee

031 Comanche 109 Oklahoma

033 Cotton 111 Okmulgee

035 Craig 113 Osage

037 Creek 115 Ottawa

039 Custer 117 Pawnee

041 Delaware 119 Payne

043 Dewey 121 Pittsburg

045 Ellis 123 Pontotoc

047 Garfield 125 Pottawatomie

049 Garvin 127 Pushmataha

051 Grady 129 Roger Mills

053 Grant 131 Rogers

055 Greer 133 Seminole

057 Harmon 135 Sequoyah

059 Harper 137 Stephens

061 Haskell 139 Texas

063 Hughes 141 Tillman

065 Jackson 143 Tulsa

067 Jefferson 145 Wagoner

069 Johnston 147 Washington

071 Kay 149 Washita

073 Kingfisher 151 Woods

075 Kiowa 153 Woodward

077 Latimer

19

County Contacts

COUNTY PHONE

NUMBER

WEBSITE WHAT IS AVAILABLE?

Adair (918) 696-7198 None Nothing on a database.

Alfalfa (580) 596-3158 None Nothing by name

Atoka (580) 889-5157 None Public can search records by name on

in-house database. Staff will assist by

telephone at this number.

Beaver (580) 625-3141 None Nothing on a database but they do have

grantor/grantee alpha indices the public

can check. Staff will assist if time

permits.

Beckham (580) 928-3383 None Staff will check alpha database back to

1995. No terminal available to public.

Grantor/grantee alpha indices are

available prior to 1995.

Blaine (580) 623-5890 None Grantor/grantee indices available only.

No database.

Bryan (580) 924-2202 None In-house database available back to

1995. Grantor/grantee indices available

prior to 1995.

Caddo (580) 247-6609 None Public can search by name on in-house

database after July 1993.

Grantor/grantee indices available prior

to 1993.

Canadian (405) 262-1070,

ext. 124

www.cana

diancounty.

org

Can search for records by name online

back to 1987. No other alphabetical

records available.

Carter (580) 223-8162 None Can search by name on in-house

database from 1989 forward. Staff will

assist by phone.

Cherokee (918) 456-3171 None Can search by name on in-house

database back to 1998. Can search

miscellaneous indices alphabetically

prior to 1998. Staff will assist by

telephone.

Choctaw (580) 326-3778 None No records on database. Can search

grantor/grantee indices alphabetically.

Staff will not conduct search.

Cimarron (580) 544-2251 None No records on database. Public can

search grantor/grantee indices

alphabetically.

http://www.canadiancounty.org/



20

Cleveland (405) 366-0240 www.cleve

landcounty

clerk.net

Land records by name, legal description,

document number back to 1994. Staff

will look up computerized records for

callers.

Coal (580) 927-2103 None Public can search in-house database by

name back to 2000. Staff will assist by

telephone. Public can search

grantor/grantee indices.

Comanche (580) 355-5214 None Public can search in-house database by

name back to 1989. Staff will assist by

phone. Public can search

grantor/grantee indices in person.

Cotton (580) 875-3026 None Public can search in-house database by

name back to 1988. Staff will look up a

name by telephone. Database is

continually being increased to include

older records. Grantor/grantee indices

available for public to search.

Craig (918) 256-2507 None No information on database. Public can

search grantor/grantee indices if they

know the approximate date of the

transaction.

Creek (918) 224-4084 None Nothing available by name.

Custer (580) 323-1221 None Nothing on database. Public can search

grantor/grantee indices.

Delaware (918) 253-4520 None Can search records by name on in-house

database back to 1987. Prior to that, can

search books by name. Staff will assist

by phone with simple inquiries.

Dewey (580) 328-5361 None In-house database back to 2001. Staff

will assist callers by looking up names.

Ellis (580) 885-7301 None No database. Can only search

grantor/grantee books by name. Staff

will not do research.

Garfield (580) 237-0225 None Records are available on a database by

name in-house back to 1990.

Garvin (405) 238-2772 None Records available by name on in-house

database back to 1993. Staff will assist

with simple inquiries by phone.

Grantor/grantee books available back to

1907. Staff will not conduct research of

books.

21

Grady (405) 224-7388 None In-house database available back to

1989; grantor/grantee books prior to

that. Staff will conduct simple database

searches by phone but will not research

books.

Grant (580) 395-2274 None In-house database back to Dec 2002.

No public terminals. Staff will assist

with simple searches. No other

information by name.

Greer (580) 782-3664 None No database. Have miscellaneous index

cross-referenced with grantor/grantee

books that can be searched

alphabetically. Staff will do research for

a fee.

Harmon (580) 688-3658 None Nothing on computer. Grantor/grantee

books only. Staff will not conduct

research.

Harper (580) 735-2012 None Grantor/grantee books only. No

database.

Haskell (918) 967-2884 None Grantor/grantee books only. No

database.

Hughes (405) 379-5487 None In-house terminal available to search

database back to July 1998. Staff will

search database over the phone for a fee.

Grantor/grantee books available prior to

that.

Jackson (580) 482-4070 None Grantor/grantee books only. Staff will

not do research.

Jefferson (580) 228-2029 None No records available by name.

Johnston (580) 371-3184 None In-house database back to 1996 or 1997.

No public terminals. Staff will assist

with simple inquiries. Grantor/grantee

books available prior to database.

Kay (580) 362-2537 None In-house database with public terminals

back to 1997. Grantor/grantee books

prior to that. Staff will not do research.

Kingfisher (405) 375-3887 None Grantor/grantee books only.

Kiowa (580) 726-5286 None Tract index and reception records

available. Staff can’t assist callers

unless it is a specific book and page

request. Can give research referral.

Latimer (918) 265-3065 None In-house terminals available to search

database by name back to 1997. Tract

index and reception records available in

their office. Staff can assist callers if

time allows. Can give research referral.

22

LeFlore (918) 647-5738 www.okco

untyrecords

.com

Select

Leflore

County,

and search

by name

back to

1983. Can

view, not

print,

documents

unless set

up with

county.

Terminals available to search in-house

database by name back 1983. Tract


their office. Staff can assist callers with

computer records only. Can give

research referral.

Lincoln (405) 258-1264 None Tract index and reception records

available in their office. Staff can assist

callers with records for a fee. Can give

research referral.

Logan (405) 282-0266 None Terminals will be available to search in-

house database by name back to 1980 at

the end of January 2004. Tract index

and reception records available in their

office. Staff can assist callers with


research referrals.

Love (580) 276-3059 None Land records are on their office

computer back to 1993. No terminals for

public use. Tract index and reception

records available in their office. Staff

can assist callers with computer records

only. Can give research referral.

McClain (405) 527-3360 None Terminal available to search in-house





research referral.

McCurtain (580) 286-2370 None Terminal available to search in-house




computer records only. Can give referral

for research.

http://www.okcountyrecords.com/



23

McIntosh (918) 689-2741 None Land records available on in-house

database by name back to 1996. No

terminals for public use. Tract index and

reception records available in their


computer records only if they have the

time. Can give research referral.

Major (580) 227-4732 None No land records on computer. Tract


their office. Staff can assist callers if the

caller has a legal description. Can give

research referral.

Marshall (580) 795-3220 None Land records available on in-house






research referral.

Mayes (918) 825-2426 None Terminals available to search in-house

database by name back to 1985. Staff


only. Tract index and reception records

available in their office. Can give

research referral.

Murray (580) 622-3920 None Land records available on in-house

database back to 1997. No terminals for

public use. Tract index and reception




Muskogee (918) 682-7781 None Terminals available to search in-house

database by name back to 1998.Tract



computer records if time allows. Can

give research referral.

Noble (580) 336-2141 None Terminals available to search in-house

database by name back to July 2000.

Tract index and reception records


callers with computer records only. Can

give research referral.

24

Nowata (918) 273-2480 None Land records available on in-house






research referral.

Okfuskee (918) 623-1724 None Terminals available to search in-house




computer records only if they have the

time. Can give research referral.

Oklahoma (405) 713-1538 www.oklah

omacounty.

org/coclerk

Some land records are available by

name back to 1991. Staff will assist

callers if not too busy.

Okmulgee (918) 756-0788 None Land records available on in-house





computer records only if given very

specific information. Can give research

referral.

Osage (918) 287-3136 None Terminals available to search in-house

database by name (surface records) back

to 1998. Tract index and reception



only. THE OSAGE TRIBE OWNS ALL

MINERALS.

Ottawa (918) 542-3332 None Terminals available to search in-house

database by name back to 1995. Staff



Pawnee (918) 762-2732 None

Land records available on in-house






research referral.

http://www.oklahomacounty.org/coclerk



25

Payne (405) 747-8310 May

implement

in 2004.

Terminals available to search in-house





research referrals.

Pittsburg (918) 423-6865 None Terminals available to search in-house




computer records if time allows.

Sometimes have research referrals.

Pontotoc (405) 332-1425 None







research referral.

Pottawatomie (405) 273-8222 None yet Land records by name on in-house

database back to 1985. Staff will look

up a name for callers.

Pushmataha (580) 298-3626 None


available in their office. Can give

research referral.

Roger Mills (580) 497-3395 www.roger

mills.org

No land or

mineral

records

available

on-line.






computer records only.

Rogers (918) 341-1860 None

Terminals are available to search in-

house database by name back to 1986.



callers with computer records if time

allows. Can give research referrals.

Seminole (405) 257-2501 None

Terminals available for public to search

by name on in-house database back to

1994. Tract index and reception records

available in their office. Staff usually

can’t assist callers with computer

records but can give research referrals.

http://www.rogermills.org/

http://www.rogermills.org/

26

Sequoyah (918) 775-4516 None Terminal available to search in-house

database by name back to 1993. Records

prior to 1993 are being entered on

database. Tract index and reception


will assist callers with computer records

if time allows.

Stephens (580) 255-0977 None Some land records are available on in-

house database by name back to 1992.


available in their office. Staff will assist

callers with computer records if time

allows. Can give research referrals.

Texas (580) 338-3141 www.txcou

nty.com

Land and

mineral

records not

available

online

Some land records available on in-house



their office. Staff will assist callers with

computer records if time allows.

Tillman (580) 335-3421 None Some land records available on in-house


public terminals. Tract index and

reception records available in the office.

Staff will assist callers if time allows.

Tulsa (918) 596-5801

Ask for Land

Department

www.tulsa

county.org

Accessible

only by

subscriptio

n or at

Tulsa

County

Libraries.

Some land records are available on



the office. Can locate records by name

on microfiche back to statehood.

Wagoner (918) 485-2216 None Some land records are available on their

computer in their office by name back to

1995. They have tract index and


Staff will assist callers if not too busy.

Washington (918) 337-2840

(918) 337-2834

phone for land

records

www.count

ycourthous

e.org

Some land records available on the

website by name back to 1995. Tract


the office. Staff will assist callers if time

allows.

Washita (580) 832-3548 None Tract index and reception records

available in the office.

http://www.txcounty.com/

http://www.txcounty.com/

http://www.tulsacounty.org/

http://www.tulsacounty.org/

http://www.countycourthouse.org/



27

Woods (580) 327-0998 None Tract index and reception records

available in the office.

Woodward (580) 256-3625 None Implemented in-house database in

December 2003. Tract index and


Compiled December 2003 – this information may have changed or been updated.

28

Section Platt with Footages

2640

2310

1980

1650

1320

990

660

330

2640

2310

1980

1650

1320

990

660

330

26

40

23

10

19

80

16

50

13

20

99

0

66

0

33

0

26

40

23

10

19

80

16

50

13

20

99

0

66

0

33

0

29

30

31

OCC OIL AND GAS WELL BROWSE DATABASE INSTRUCTIONS

The address is www.occeweb.com

When you get to our home page, hold your cursor over the gold button at the top of the

screen that says, “Divisions.” Pull your cursor down to “Oil and Gas,”, then over to the

list that pops up on the right. Pull your cursor down to “Databases” and click there.

NOTE: If you are using Internet Explorer 7.0 and/or Microsoft Vista, please see special

instructions on this screen before going to the next step.

On the next screen, choose “oil and gas database web applications database” again.

When asked to download something (Oracle, Java Aplet, J Initiator) always choose

the positive response. Depending upon the type of internet connection you have

downloading will be very quick or quite time consuming.

You will finally come to a blue screen with a painting of roughnecks working on a well.

Choose “well browse”.

When you get to the well query page, you can search by well name, API number or

Section, Township, and Range. A “date range” search feature has also been added for

certain records.

The “operator” search field on this screen is to retrieve a list of wells operated by a

particular operator, not to locate an operator’s address and telephone number. You must

use the “operator browse” program to find this information.

You will usually search by legal description. Go to the bottom of this form and enter the

section, township, and range. It is not necessary to enter the county if you know the legal

description. Quarter sections can be added if desired, however, if you enter a quarter

section, and the well is not indexed with quarters, you may not get a complete list of

wells at that location. We suggest first browsing the entire section then narrowing down

the search criteria if necessary.

After entering your search criteria, click “search now” on the upper right side of the

screen. This will take you to the “results” screen where you will see an inventory of all

the wells in the section.

Click on the well you are interested in and the line will turn blue.

Follow the buttons on the tool bar to find the information you are looking for. New

button at the bottom of the screen allow you to link to imaged well records and logs, and

to connect to the “operator browse” database.

32

Click “search” at the upper left side of the screen to conduct another query. Attempting

to conduct another query from the “results” screen could lock up your computer. If you

need assistance, contact the Oil and Gas Complaints and Information Department at (405)

521-2613.

33

OCC OPERATOR BROWSE DATABASE INSTRUCTIONS







On the next screen, over on the left, choose “oil and gas database web applications

database” again.

When asked to download something (Oracle, Java Aplet, J Initiator) always choose the

positive response. Depending upon the type of internet connection you have

downloading will be very quick or quite time consuming.

You will finally come to a blue screen with a painting of roughnecks working on a well.

Choose “operator browse”.

The first thing you must do is click “enter query” in the lower center of the screen.

If you know the operator number enter it in the first field and click “enter query” on the

lower right side of the screen. The operator name, address, telephone number, and surety

status will be displayed. If you do not know the operator number, tab over to the column

headed “operator name” and type in the name you are looking for. Be sure to enter

enough information but not too much. It is usually helpful to use the wild card, %,

before, after, or surrounding the name you have entered. Click “run query” to display the

operator name. If more than one comes up, click on the line of the one you are interested

in to display the address, telephone number, and surety information.

If you need assistance, contact the Oil and Gas Complaints and Information Department

at (405) 521-2613.


34

OCC IMAGED RECORDS DATABASE INSTRUCTIONS




list that pops up on the right. Pull your cursor down to “Imaged Records” and click there.

Choose the type of record you want to look at – usually Oil and Gas Well Records for

completion and plugging reports, or OAP Orders and Case Files for orders and

applications such as pooling, spacing, etc.

For Well Records there are several different search criteria. Only fill in one field if

possible. For legal description run all the digits together ex: 0212n15e. Enter your

search criteria and click “search”

When the list of records appears it may be necessary to view several of them to locate the

record you are looking for. Some wells will be identified by a combination of well name,

API#, quarter section, form #, etc. Click on the item you are interested in and a copy will

appear.

To search for an order or application go to OAP Orders and Case Files and enter the

order number or the cause number. When searching by cause number it is important to

also complete the field “Case Type”, usually CD for oil and gas. This database contains

all Commission records including transportation and public utilities, not just oil and gas

and sometimes the same case number might be assigned to different case types.

When the index for the document appears click the blue ID number on the left to view the

document.


at (405) 521-2613.

Note: County codes used in the Well Browse database are different from those used in

the Imaged Records database.


35

OCC CASE PROCESSING DATABASE INSTRUCTIONS


This database is used to look up OCC causes, applications, orders, hearing dispositions,

etc. Imaged copies are not available here but once you get the cause or order number you

can go to our Imaged Records database to retrieve them.






On the next screen scroll down and choose “case processing system web application”.

When asked to download Oracle, Java Aplet, J Initiator, etc. always give the positive

response. Depending upon the type of internet connection you have downloading will be

very quick or quite time consuming.

A green screen with a table will appear. Use the pop-up menus labeled 1, 2, and 3 to

choose your search criteria. Example 1) Section 2) equals 3) 24. Click 4) add entry.

Repeat until search criteria have been entered then click 5) find. If you make a mistake

click “remove entry”. However if you need to remove more than one entry you should

“remove all” and start over.

Adding as much information as possible will shorten the search time. Once the list of

documents appears, click on the one you are interested in and follow the tabs in the center

of the screen to retrieve case information.


at (405) 521-2613.

Documents

Basic Information for the Oklahoma Royalty Owner - Ningapi.ning.com/files/D*FHCFGru-wKo5Pa2NIuoo8MzvrjZpzSRF6Yfvq0A8... · Basic Information for the Oklahoma Royalty Owner ... problems