A Conversion of Reserved Overriding Royalty Interest to Working Interest form. The assignee shall be entitled to recover, out of the total proceeds derived from the sale of oil and gas produced from each well drilled and completed as a well capable of producing oil or gas in paying quantities on the Land, the total cost of drilling, completing, and equipping such well together with the cost of operating such well until the time of such recovery.
Michigan Conversion of Reserved Overriding Royalty Interest to Working Interest is a legal process undertaken in the state of Michigan, USA, that involves the transfer or transformation of reserved overriding royalty interest (ORRIS) into working interest (WI) in an oil and gas lease. This conversion provides the holder of the ORRIS with the added benefits and rights associated with being a working interest owner. Keywords: Michigan, Conversion, Reserved Overriding Royalty Interest, Working Interest, oil and gas lease. There are different types of Michigan Conversion of Reserved Overriding Royalty Interest to Working Interest, including: 1. Voluntary Conversion: This type of conversion occurs when the holder of the ORRIS voluntarily elects to convert it into WI. The decision may be driven by economic considerations, such as a desire for increased participation in the drilling operations or higher net revenue potential. 2. Default Conversion: In situations where the holder of the ORRIS fails to fulfill certain obligations or breaches the terms of the lease agreement, the ORRIS may be automatically converted into WI. This conversion serves as a mechanism to protect the interests of the working interest owners and ensure compliance with lease provisions. 3. Forced Conversion: Forced conversion occurs when a court-ordered directive mandates the conversion of ORRIS into WI. This type of conversion may arise from disputes related to ownership rights, title defects, or disagreement among leaseholders. 4. Partial Conversion: Partial conversion refers to a scenario where only a portion of the ORRIS is converted into WI. This may happen if the holder of the ORRIS desires to maintain some royalty interest while simultaneously participating as a working interest owner. It is important to note that Michigan Conversion of Reserved Overriding Royalty Interest to Working Interest is a complex legal process that requires thorough understanding and adherence to applicable laws, regulations, and contractual provisions. Parties involved should consult experienced attorneys specializing in oil and gas law to navigate these transactions successfully.
