دیکشنری تخصصی مهندسی نفت - نسخه آنلاین

n: an option right reserved by the granting company of a farmout to convert an overriding royalty to a working interest once the conditions for such back-in have been met. Compare election at casing point.

n: a cash payment by the lessee for the execution of an oil and gas lease by the mineral owner;expressed as dollars per acre. Occasionally, an oil payment or overriding royalty may be reserved as a bonus by a lessor in addition to regular royalty.

n: an interest in oil and gas created out of a greater interest and assigned by the owner. Examples are the grant of an overriding royalty interest out of a working interest and the grant of an oil payment out of a working interest.

n: payments to royalty owners as compensation for losses in income that they may be suffering because of failure to develop a lease adequately.

n: when several producers, either voluntarily or by state regulation, pool acreages to form a unit." They may cross-assign their leases to one another, creating a common obligation to each royalty owner.

n: a reduction in US taxes for owners of an economic interest in minerals in place to compensate for the exhaustion of an irreplaceable capital asset. This economic interest includes mineral interest, working interest in a lease, royalty, overriding royalty, production payment interest, and net profits interest.

n: a statement of opinion by a title examiner on the state of the title to land, mineral, royalty, or working interests in a producing tract of land. This opinion, usually in letter form, is the basis of payment to all affected owners and must recite all the owners interests. Com- pare drill site opinion. title opinion.

an older term indicating the mineral owners royalty-based “share” of the oil. This was from a time when natural gas had no value.

n: an agreement whereby the owner of a lease who does not wish to drill at the time agrees to assign the leasehold interest, or some part of it, to a third party who does wish to drill, conditional on the third partys drilling a well within the expiration date of the primary term of the lease. The assignment may include the entire interest together with dry hole money, or partial interest or entire interest with or without an override. If an override is retained, the owner of the lease may retain an option to convert such overriding royalty retained to an agreed-upon working interest. A farmout is distinguished from a joint operating agreement by the fact that the partner farming out does not incur any of the drilling costs. The primary characteristic of a farmout is the obligation of the third party to drill one or more wells on the farmout acreage as a condition prerequisite to completion of the transfer of title to such third party.

n: an oil and gas lease on federal land issued under the Mineral Leasing Act. Federal leases usually provide step- scale or sliding-scale royalty;a flat discovery royalty of one-eighth may also be specified.