Archive for the 'Royalties' Category

Oil and gas producers should expect a political fight after a US appeals court ruled in their favor about royalties from deepwater leases. They also should prepare for wild claims about associated “costs.”Deepwater royalty relief, one of the most effective energy programs in US history, elicited outrage in 2006 when the New York Times reported that the federal budget lacked estimates of royalty income for deepwater Gulf of Mexico leases issued in 1998 and 1999. The leases didn’t reinstate royalty, as did those issued in similarly administered years, when oil and gas prices exceeded statutory “thresholds.”

Courts, meanwhile, have been addressing the question whether the Department of the Interior’s Minerals Management Service had authority to limit royalty relief on the basis of price for leases issued in the five years from 1996 through 2000. So far, the consistent answer is no.

Full Story in Oil and Gas Journal Feb 2009

ARLINGTON, Texas, Jan. 23 – Carrizo Oil & Gas, Inc. CRZO is proud to announce that initial royalty payments totaling more than $675,000 have been dispersed to mineral owners in the City of Arlington who signed agreements associated with the production of natural gas on and around the campus of The University of Texas at Arlington.

Our operations at the University of Texas at Arlington have been an overwhelming success,” Chip Johnson, President and CEO of Carrizo Oil & Gas, Inc. said. “It is exciting to be able to share these successes with our partners.”Among the 120 residents and organizations receiving their first monthly installment of royalty payments are:

• University of Texas at Arlington
• City of Arlington
• First Baptist Church of Arlington
• State of Texas

Full Story

The University of Texas has received the first of their monthly natural gas royalty checks — and it’s a whopper.

The $528,495 check is the first royalty payment related to the six wells that were developed on campus last year and that went into production in November 2008.

Others who will receive their first monthly royalties related to these wells include First Baptist Church of Arlington, the City of Arlington, the State of Texas and several neighbors in the College Hills neighborhood as well as other areas.

“This is exciting news for the University and for our community,” said UT Arlington President James D. Spaniolo. “We look forward to using the University’s royalties to support undergraduate scholarships and graduate fellowships, faculty and staff recruitment and retention and the campus master plan.”

Full Story at nbcdfw.com

Here are a few reasons for you to consider selling your oil and gas royalties.

CASH OPPORTUNITY

You can obtain cash for your oil and gas royalty interests. The cash you receive for your royalty interest could fund other lower-risk investment opportunities. Most oil and gas properties decline in value over time, whereas the other investment options available to you could potentially appreciate.

ESTATE PLANNING

Frequently, people planning and organizing their estate will divest their oil and gas royalties prior to their death. Eliminating oil and gas royalties from your estate could make the cost of settling your estate lower. Divesting the royalties in your estate can save your heirs the expense of preparing transfer documents and the marketing of the royalty interest.

INCREASING LIQUIDITY

Oil and gas royalty management can be a burden, even for small owners. The expertise for managing oil and gas royalty interests is not always available since many tax consultants and investment experts are not knowledgeable in the oil and gas business or aware of the rules pertaining to oil and gas royalties.

Contact Charlie Brown today to discuss selling your oil and gas royalty interests.

Owners of oil and gas mineral, royalty and overriding royalty interests are entitled to revenues from the production of an oil and gas well without being responsible for the drilling and monthly operating expenses. Below is a breakdown of the differences between mineral, royalty and overriding royalty interests.

Mineral Rights

Royalty Interests

Overriding Royalty Interests

• Does not own minerals under the ground.
• Owns and receives a portion of revenues generated from oil and gas production.
• Ownership expires when lease is abandoned or when production is stopped.
• Created from working interests.
• Does not execute leases and collect bonus payments.
• Does not collect up-front bonus payment.