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What’s the difference between Mineral Interests (MI), Royalty Interests (RI), Overriding Royalty Interests (ORRI), and Working Interest (WI)?
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MI
|
RI |
ORRI |
WI |
| Generates Revenue from Well Production |
Y |
Y |
Y |
Y |
| Owns the Underground Minerals |
Y |
Y |
N |
N |
| Ownership Continues after Production Stops |
Y |
Y |
N |
N |
| Collects Upfront Bonus Payments |
Y |
N |
N |
N |
| Has Rights to Executive Leases |
Y |
N |
N |
N |
| Pays to Operate or Drill the Well |
N |
N |
N |
Y |
| Participates in the Lease Operating Expenses |
N |
N |
N |
Y |
| Has Significant Tax Advantages |
N |
N |
N |
Y |
(NPRI) Non-Participating Royalty Interests - Are Interest similar to ORRI's but typically not bound to a well or lease, they are typically bound to Minerals or Mineral Rights assigned by a land/mineral right owner conveying either a permanent royalty or temporary royalty off his or hers mineral rights and lands, typically NPRI do not have executive rights to bonuses but the NPRI owner is carried and bound by such leases that are executed by the true Mineral Rights Owner.
How Long is the entire Process to Sell My Oil & Gas Mineral or Royalty Interest(s)?
It typically takes several days to several weeks pending the information currently available and presented by the Seller. Some Royalty Companies string Sellers out for periods of 30-60+ Days, however we offer solutions that meet our timeslines and work and fit within the guidelines and timelines of the Owners/Sellers?
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How Much will I be offered for My Interest and is there a Real Science to all of this?
Offers vary on the Following Evaluations determined by our Petroleum Engineer:
1. Production History - (Decline Curves and Water Rates) of the Field and/or Leases
2. Operators Reputation - Some just get it done better than others.
3. Reservoir Formation - Some Reservoirs have longer production histories than others
4. Commodity Price Risk - Gas, Oil, or both - is it sour, treated, etc.
5. Future Production and Development
6. Interest Type - Royalty, Overriding Royalty, Mineral Rights/Interest, Non-Participating Royalty Interest, or Working Interest.
7. Historical Cash Flows and Averages for: 12 months, 6 months, and 3 months.
8. Tax Rates - Tax Rates for Purchase and Severance may be too high, low, or non-existent pending your state of where the interest is located, which affects a properties value and offer rate.
Our offers typically range 25 - 70 months (pending certain parameters). The information above allows us to calculate current reserves with a prediction of future reserves and cash flows. Our objective is to offer you fair market value while addressing risks and uncertainties that may be involved in future interests and commodities prices.
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How Do I receive an Offer?
Its as easy as One, Two, Three
If you're Selling Oil & Gas Royalties - Click Here to Get Started!
If you're Selling Non-Producing Mineral Rights - Click Here to Get Started!
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Am I Obligated to Sell My Interest if I Receive an Offer?
Absolutely Not, All offers presented by UniRoyalties are "Non Obligation" Offers to Owners for their Oil & Gas Interest(s). Additionally, receiving an offer does not obligate you to sell either.
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Why Do My Checks Vary Every Month?
Because of variations of oil & gas production compounded with market averages, majority of oil & gas royalties are determined off the monthly commodity averages. Most operators are 60-90 days back meaning your current months check is typically for production two months back (gas) or one month back (oil), however some oil & gas companies operate 90 days back but is always based on production and commodity pricing. Additionally, productions do vary and change because of the declines in oil & gas wells. There is only so much gas that can be recovered from reserves on a monthly basis and over the lifetime of the well.
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Why Don't I Receive Royalty Checks Anymore?
1. A different company is responsible for paying you royalties and may be currently setting up your owner accounts.
2. The amounts you receive may not have accrued the minimal amount set forth by the Royalty Payor, for example Companies like Devon Energy Production Company, LP and Chesapeake Exploration, LP require that you must first have a minimum accrued amount of at least $100.00USD to receive a royalty check.
3. Your interest may be in suspense for legal reasons because you have not filed all appropriate paperwork with the Oil & Gas Company who is to pay you royalties, address change request, estate changes, or litigation.
4. The wells and/or field may not be producing gas or oil, please call the number on the last check stub you recieved. If you can't locate that number please feel free to contact us for further assistance and help.
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How Do I Transfer My Interest to My Heirs Before I Die?
Contact a competitant Board Certified Oil & Gas attorney or an Attorney that specializes in Wills, Trusts, Probate, and Deeds.
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How Do I Calculate My Royalty Interest?
Divide the Number of (Net) Mineral Acres You Own within the Unit by the Total Acres within the Unit, and multiply this by your royalty interest Listed in your Oil & Gas Lease.
Follow the Example Below:
Net Acre(s): 11 Acres
Unit Size: 640 acres
Royalty: 20% or 1/5th
11 ac/640ac X .20 = .0034375 Royalty Interest.
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What are the Future Predictions for Oil & Gas Prices?
Since experts can not agree on oil inventories of the volatility of the markets and what the future will have in store for Oil or Gas, we feel its a better approach to focus less on Future Prices and Forecasts and more on current trends.
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What if I have additional questions that were not answered here?
Please contact us by Clicking Here
Or by Calling 720-213-4954
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Where are you Currently Seeking Acquisitions?
We are Currently Seeking Acquisitions in the Following Oklahoma Counties:
Adair County, Atkoa County, Beaver County, Caddo County, Canadian County, Carter County, Choctaw County, Cimarron County, Coal County, Creek County, Hughes County, Kingfisher County, Latimer County, LeFlore County, Lincoln County, Major County, McClain County, McCurtain County, McIntosh County, Murray County, Okfuskee County, Oklahoma County, Okmulgee County, Osage County, Ottawa County, Pittsburg County, Pontotoc County, Pottawatomie County, Pushmataha County, Roger Mills County, Rogers County, Seminole County, Sequoyah County, Stephens County, Texas County, Washington County, Washita County, Woods County, and Woodward County.
We are Currently Seeking Acquisitions in the Following Arkansas Counties:
Washington County, Madison County, Crawford County, Sebastian County, Scott County, Hempstead County, Nevada County, Miller County, Lafayette County, Columbia County, Union County, Ouachita County, Calhoun County, Bradley County, Franklin County, Perry County, Pope County, Newton County, Garland County, Van Buren County, Cleburne County, Jackson County, Johnson County, Faulkner County, White County, Woodruff County, Lonoke County, Jefferson County, Grant County, Conway County, Stone County, Searcy County, Sharp County, Izard County, Arkansas County, Saline County, Clark County, Dallas County, Cleveland County, Little River County, and Yell County.
We are actively seeking acquisitions in the following Louisiana Parishes:
St Tammany Parish, Livingston Parish, St Bernard Parish, St Charles Parish, Ascension Parish, Washington Parish, St Mary Parish, Rapides Parish, Calcasieu Parish, Vernon Parish, Caddo Parish, Ouachita Parish, Bossier Parish, Cameron Parish, Lincoln Parish, Plaquemines Parish, Jackson Parish, Terrebonne Parish, Union Parish, St Landry Parish, Sabine Parish, Vermilion Parish, Orleans St. Bernard Parish, Bienville Parish, St James Parish, Webster Parish, St martin Parish, Allen Parish, Franklin Parish, DeSoto Parish, Grant Parish, Claiborne Parish, Richland Parish, Caldwell Parish, West Feliciana Parish, Evangeline Parish, Winn Parish, Acadia Parish, Assumption Parish, Iberia Parish, Iberville Parish, Concordia Parish, Avoyelles Parish, Beauregard Parish, Lafourche Parish, St Helena Parish, Vermillion Parish, Natchitoches Parish, St. John the Baptist Parish, Lasalle Parish, Red River Parish, Plaquemines Parish, and Pointe Coupee Parish.
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Other Helpful Definitions and Information
Oil and Gas Glossary
SCF - Standard Cubic foot
MCF - Thousand Cubic feet
MMCF - Million Cubic feet
BCF - Billion Cubic feet
MCFD - Thousand cubic feet (of gas) per day
MMCFD - Million cubic feet (of gas) per day
BO - Barrel of oil
BC - Barrel of Condensate
MMBO - Million barrels of oil
MMBC - Million barrels of condensate
BCFE - Billion cubic feet of gas equivalent (oil converted to gas by multiply by 6)
BOE - Barrel of oil equivalent (gas converted to oil by dividing by 6)
Common Oil and Gas Terminology
Conventional crude oil
Petroleum found in liquid form, flowing naturally or capable of being pumped without further processing or dilution.
Development well
A well drilled within the proved area of an oil or gas reservoir to the depth of a stratigraphic horizon known to be productive; a well drilled in a proven field for the purpose of completing the desired spacing pattern of production.
Discovery well
An exploratory well that encounters a previously untapped oil or gas deposit.
Dry hole
Any exploratory or development well that does not find commercial quantities of hydrocarbons.
Established reserves
The portion of the discovered resource base that is estimated to be recoverable using known technology under present and anticipated economic conditions. Includes proved plus a portion of probable (usually 50%).
Exploratory well
A well into an area where petroleum has not been previously found or one targeted for formations above or below known reservoirs.
Field
The surface area above one or more underground petroleum pools sharing the same or related infrastructure.
Flow line
Pipe, usually buried, through which oil or gas travels from the well to a processing facility.
Flaring/Venting
The controlled burning (flare) or release (vent) of natural gas that can't be processed for sale or use because of technical or economic reasons.
Heavy crude oil
Oil with a gravity below 28 degrees API.
Infill Drilling
Wells drilled between established producing wells on a lease in order to increase production from the reservoir.
Injection well
A well used for injecting fluids (air, steam, water, natural gas, gas liquids, surfactants, alkalines, polymers, etc.) into an underground formation for the purpose of increasing recovery efficiency.
Lease
Legal document giving an operator the right to drill for or produce oil or gas; also, the land on which a lease has been obtained.
Light crude oil
Liquid petroleum which has a low density and flows freely at room temperature.
Medium Crude Oil
Liquid petroleum with a density between that of light and heavy crude oil.
Methane
The principal constituent of natural gas; the simplest hydrocarbon molecule, containing one carbon atom and four hydrogen atoms.
Natural gas liquids
Liquids obtained during natural gas production, including ethane, propane, butanes, and condensate.
Oil Sands
A deposit of sand saturated with bitumen.
Operator
The company or individual responsible for managing an exploration, development or production operation.
Petroleum
A naturally occurring mixture composed predominantly of hydrocarbons in the gaseous, liquid or solid phase.
Pool
A natural underground reservoir containing an accumulation of petroleum.
Porosity
The volume of spaces within rock that might contain oil and gas (like the amount of water a sponge can hold); the open or void space within rock -- usually expressed as a percentage of the total rock volume. Thus porosity measures the capacity of the rock to hold natural gas, crude oil or water.
Primary Recovery
The production of oil and gas from reservoirs using the natural energy available in the reservoirs and pumping techniques.
Royalty
The owner's share of production or revenues retained by government or freehold mineral rights holders. In natural gas operations, the royalty is usually based on a percentage of the total production.
Sandstone
A compacted sedimentary rock composed mainly of quartz or feldspar; a common rock in which oil, natural gas and/or water accumulate.
Secondary Recovery
The extraction of additional crude oil, natural gas and related substances from reservoirs through pressure maintenance techniques such as water flooding and gas injection.
Sedimentary basin
A geographical area, such as the Western Canada Sedimentary Basin, in which much of the rock is sedimentary (as opposed to igneous or metamorphic) and therefore likely to contain hydrocarbons.
Seismic studies
Refers to studies done to gather and record patterns of induced shock wave reflections from underground layers of rock which are used to create detailed models of the underlying geological structure.
Shale
Rock formed from clay.
Solution Gas
Natural gas that is found with crude oil in underground reservoirs. When the oil comes to the surface, the gas expands and comes out of the solution.
Sour Gas
Natural gas at the wellhead may contain hydrogen sulphide (H2S), a toxic compound. Natural gas that contains more than 1 per cent of H2S is called sour gas. About 30 per cent of Canada's total natural gas production is sour, most of it found in Alberta and northeast British Columbia.
Stakeholders
Industry activities often affect surrounding areas and populations. People with an interest in these activities are considered stakeholders. They may include nearby landowners, municipalities, Aboriginal communities, recreational land users, other industries, environmental groups, governments and regulators.
Steam Injection
An improved recovery technique in which steam is injected into a reservoir to reduce the viscosity of the crude oil.
Sweet oil and gas
Petroleum containing little or no hydrogen sulphide.
Synthetic Crude Oil
A mixture of hydrocarbons, similar to crude oil, derived by upgrading bitumen from oil sands.
Tertiary Recovery
The third major phase of crude oil recovery which involves using more sophisticated techniques, such as steam flooding or injection of chemicals, to increase recovery.
Tight Gas
Gas with very low flow rates. Found in sedimentary layers of rock that are cemented together so tight that it "greatly hinders" the extraction. Getting tight gas out usually requires enhanced technology like "hydraulic fracturing" where fluid is pumped into the ground to make it more permeable. The National Energy Board estimates Canada could have between 89 and 1500 trillion cubic feet (tcf) of tight gas, compared to total gas estimates (excluding tight gas) of 733 tcf.
Traps
A mass of porous, permeable rock - sealed on top and both sides by non-porous, impermeable rock - that halts the migration of oil and gas, causing them to accumulate.
Ultimate potential
An estimate of recoverable reserves that will have been produced by the time all exploration and development activity is completed; includes production-to-date, remaining reserves, development of existing pools and new discoveries.
Undiscovered recoverable resources
Those resources estimated to be recoverable from accumulations believed to exist based on geological and geophysical evidence but not yet verified by drilling, testing or production.
Upgrading
The process of converting heavy oil or bitumen into synthetic crude oil.
Viscosity
The resistance to flow, or "stickiness" or a fluid.
Wildcat
A well drilled in an area where no oil or gas production exists.
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