This lease rider form may be used when you are involved in a lease transaction, and have made the decision to utilize the form of Oil and Gas Lease presented to you by the Lessee, and you want to include additional provisions to that Lease form to address specific concerns you may have, or place limitations on the rights granted the Lessee in the standard lease form.
Arkansas Shut-In Oil Royalty refers to the revenue obtained from oil production that has been temporarily ceased or halted in the state of Arkansas. When oil wells are shut-in due to various reasons such as low oil prices, market conditions, or operational issues, royalty owners continue to receive compensation for the utilization of their mineral rights. This compensation is commonly known as Arkansas Shut-In Oil Royalty. The different types of Arkansas Shut-In Oil Royalty can include: 1. Temporary Shut-In Royalty: This type of royalty is applicable when an oil well is temporarily shut down or suspended for a specific period. It may be due to maintenance, repair work, or the requirement of restrictions faced by the oil company due to market conditions. 2. Economic Shut-In Royalty: During periods of low oil prices or unfavorable market conditions, oil companies may find it economically unviable to continue production. In such cases, the wells may be shut-in temporarily until prices improve, and royalty owners receive compensation known as economic shut-in royalty. 3. Regulatory Shut-In Royalty: Sometimes, regulatory or legal requirements may force oil companies to shut-in their operations. This could be due to issues such as environmental concerns, compliance violations, or pending approvals. Royalty owners in these cases receive compensation as regulatory shut-in royalty. 4. Force Mature Shut-In Royalty: In exceptional circumstances like natural disasters, wars, or unforeseen events beyond the control of oil companies, force majeure clauses are activated, allowing temporary cessation of operations. Royalty owners are entitled to receive force majeure shut-in royalty, compensating them for losses incurred during such events. Arkansas Shut-In Oil Royalty plays a crucial role in providing financial support to mineral rights owners during periods where oil production is halted. It ensures that despite the temporary cessation of operations, they continue to receive compensation based on their ownership interests in the oil wells.
