Get Form 3000.3a. Transfer Of Operating Rights Interest - Blm

Record Title: Primary ownership of an interest in an oil and gas lease including the obligation to pay rent, and the right to transfer and relinquish the lease. Overriding royalty and operating rights are severable from record title interests.

An assignment of oil and gas lease is a contractual agreement between a landowner and an oil or gas company in which the company gains the right to explore for, develop, and produce oil and gas from the property.

A transfer of interest is a sale, assignment, transfer through inheritance, or conveyance of total or partial ownership, or legal interest in a mining claim or site.

The BLM administers the lease but the Forest Service has more direct involvement in the leasing process for lands it administers. The Act also establishes a requirement that all public lands that are available for oil and gas leasing be offered first by competitive leasing.

Record Title: Primary ownership of an interest in an oil and gas lease including the obligation to pay rent, and the right to transfer and relinquish the lease. Overriding royalty and operating rights are severable from record title interests.

If the lessee has begun to produce oil or gas “in paying quantities” by the end of the primary or extended term, then the lease is extended so long as the lessee continues to produce oil or gas. During the period of the lease, the lessee must pay either rental on the land, or royalties on the oil and gas produced.

An assignment of oil and gas lease is a contractual agreement between a landowner and an oil or gas company in which the company gains the right to explore for, develop, and produce oil and gas from the property.

If the lessee has begun to produce oil or gas “in paying quantities” by the end of the primary or extended term, then the lease is extended so long as the lessee continues to produce oil or gas. During the period of the lease, the lessee must pay either rental on the land, or royalties on the oil and gas produced.

A transfer of interest is a sale, assignment, transfer through inheritance, or conveyance of total or partial ownership, or legal interest in a mining claim or site.

An overriding royalty interest (ORRI) is similar to a royalty interest in that it is also a portion of the proceeds from the sale of production. However, it is not retained under the terms of the oil and gas lease. An ORRI is granted, assigned and created under the terms of a separate document.

The BLM administers the lease but the Forest Service has more direct involvement in the leasing process for lands it administers. The Act also establishes a requirement that all public lands that are available for oil and gas leasing be offered first by competitive leasing.

Calculating Overriding Royalty Interest An ORRI is a straight percentage. For example, a 2% override would appear on the royalty statement as 0.02 interest in the proceeds from the sale of the leased hydrocarbons.

The primary term on average is 3 years. Companies can add a 2-year extension if they wish. The company that executed the lease uses this time period to achieve drilling the well. Once that is completed, the secondary term begins and lasts for as long as the well is producing.

If the lessee has begun to produce oil or gas “in paying quantities” by the end of the primary or extended term, then the lease is extended so long as the lessee continues to produce oil or gas. During the period of the lease, the lessee must pay either rental on the land, or royalties on the oil and gas produced.

ASSIGNMENT OF RECORD TITLE INTEREST File three originally-signed and dated copies of the current edition of Form 3000-3 in the BLM State Office administering the lease. Machine copies of the original signatures are not acceptable. The assignor(s) must originally sign and date all three copies of the assignment.

If the lessee has begun to produce oil or gas “in paying quantities” by the end of the primary or extended term, then the lease is extended so long as the lessee continues to produce oil or gas. During the period of the lease, the lessee must pay either rental on the land, or royalties on the oil and gas produced.

The Truth: Oil production from federal lands and waters provides approximately 24% of total U.S. oil production. Additionally, natural gas production from federal lands and waters is approximately 11% of total U.S. natural gas production.

Overview: The Federal Oil and Gas Program The BLM currently manages 37,496 Federal oil and gas leases covering 26.6 million acres with nearly 96,100 wells. 7 Of the more than 26 million onshore acres under lease today to the oil and gas industry, nearly 13.9 million (or 53 percent) of those acres are non-producing.

An overriding royalty interest (ORRI) is similar to a royalty interest in that it is also a portion of the proceeds from the sale of production. However, it is not retained under the terms of the oil and gas lease. An ORRI is granted, assigned and created under the terms of a separate document.

Calculating Overriding Royalty Interest An ORRI is a straight percentage. For example, a 2% override would appear on the royalty statement as 0.02 interest in the proceeds from the sale of the leased hydrocarbons.

The primary term on average is 3 years. Companies can add a 2-year extension if they wish. The company that executed the lease uses this time period to achieve drilling the well. Once that is completed, the secondary term begins and lasts for as long as the well is producing.

ASSIGNMENT OF RECORD TITLE INTEREST File three originally-signed and dated copies of the current edition of Form 3000-3 in the BLM State Office administering the lease. Machine copies of the original signatures are not acceptable. The assignor(s) must originally sign and date all three copies of the assignment.

The Truth: Oil production from federal lands and waters provides approximately 24% of total U.S. oil production. Additionally, natural gas production from federal lands and waters is approximately 11% of total U.S. natural gas production.

Overview: The Federal Oil and Gas Program The BLM currently manages 37,496 Federal oil and gas leases covering 26.6 million acres with nearly 96,100 wells. 7 Of the more than 26 million onshore acres under lease today to the oil and gas industry, nearly 13.9 million (or 53 percent) of those acres are non-producing.