Replies to This Discussion

Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 29, 2011 at 5:03

Not without knowing the royalty percentage.

Permalink Reply by btj on August 29, 2011 at 5:09

It's 1/6. Never had heard of the HS when we leased.  

Oil & Gas ProPermalink Reply by Ben Elmore on August 29, 2011 at 6:53

Is this the decimal appearing on your DO?  If so, wouldn't it already account for your royalty percentage?

Permalink Reply by btj on August 29, 2011 at 7:37

Yes, that is the amount on my DO.

Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 29, 2011 at 8:40

btj, my calculation would be that you own approximately 50.65 net mineral acres.  Ben, I'm just not a good enough mathamagician to calculate the acreage off the DO participation decimal interest and the unit acres alone.

 

Oil & Gas ProPermalink Reply by Ben Elmore on August 29, 2011 at 10:53

My mistake Skip.  I see now you were going the extra mile and recalculating his decimal to make sure what appeared in the DO was correct.  Very good!

Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 29, 2011 at 11:01

Thanks, Ben.  However we might reserve judgement on my calculations until btj lets us know if I am close.  LOL!

Permalink Reply by btj on August 30, 2011 at 7:51

Thanks Skip, That should be about right. I had no idea how to convert it to acreage. I wanted to double check it since I had questioned my division order and they increased it 25%, can't be too careful I guess.  

Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 30, 2011 at 8:02

You're welcome, btj.  It's nice to get a passing grade as math was not my strong suit in school.  LOL!  Good luck to you.

landownerPermalink Reply by LL on August 30, 2011 at 10:38

Please correct me if this is the wrong way to go about this.  I use an old method to calculate the mineral interest.  If you owned 100% of the interest it would equal 583.77 acres.  If you had a 10% interest in the unit it would equal 58.377 acres.  If you only owned one-hundreth, or 1/100 you'd own 5.8377 acres.  Since you own 0.01446302 interest, wouldn't that equal about 8.4430655 acres?

Oil & Gas ProPermalink Reply by Skip Peel - Mineral Consultant on August 30, 2011 at 10:52

You are not accounting for the royalty percentage which is one of the variables in the decimal participation number.  The standard equation is:

 

Your acres divided by the unit acres multiplied by the royalty percentage.

50.65 divided by 583.77 = 0.0867636 multiplied by 0.1667 =  0.0144634

Permalink Reply by btj on August 30, 2011 at 11:08

LL, that's the formula that I was using but I knew the acreage wasn't right. I like Skip's formula much better! I appreciate everyone's help. 

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