The Arizona Stipulation Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease is a legal provision that outlines the rules and regulations for the distribution of nonparticipating royalty payments in oil and gas leases in Arizona. This stipulation ensures fair distribution of royalties to nonparticipating landowners who may not have signed the lease but are entitled to a share of the profits. Under this stipulation, segregated tracts covered by a single oil and gas lease are identified and their corresponding nonparticipating royalty beneficiaries are determined. The term "segregated tracts" refers to separate portions of land within the same lease, each with its own specific ownership and nonparticipating royalty interests. There are different types of Arizona Stipulations Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease, including: 1. Segregated Tract Identification: This type of stipulation focuses on defining and identifying the separate tracts of land within the overall oil and gas lease. It specifies the boundaries and ownership details of each tract to avoid any disputes or confusion. 2. Nonparticipating Royalty Determination: This stipulation outlines the process for determining the nonparticipating royalty interests in each segregated tract. It may include factors such as the size of the tract, the percentage of nonparticipating royalty interest, and any existing agreements or contracts. 3. Royalty Payment Distribution: This type of stipulation establishes the mechanism for distributing the nonparticipating royalty payments among the beneficiaries. It outlines the rights and obligations of both the lease operator and the nonparticipating royalty beneficiaries, ensuring timely and accurate royalty disbursements. 4. Dispute Resolution: In cases where disputes arise regarding the payment of nonparticipating royalties, this stipulation provides guidelines for resolving conflicts. It may include procedures for arbitration, mediation, or legal action, aiming to maintain fairness and equity for all parties involved. The Arizona Stipulation Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease plays a crucial role in protecting the rights and interests of nonparticipating landowners. By defining the rules for royalty payment distribution, it ensures transparency, clarity, and compliance with state regulations in the oil and gas industry.