This form is used to resolve any question as to how royalty is to be paid to the Parties in the event of production, under the Lease, on any part of the Lands. The Parties are entering into this Agreement to stipulate and agree to the ownership of each Party's respective share of the royalty reserved in the Lease payable for production attributable to their Interests from a well located anywhere on the Lands.
Puerto Rico Agreement Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease is a legal document that outlines the terms and conditions for the payment of nonparticipating royalties in relation to oil and gas extraction activities on segregated tracts in Puerto Rico. This agreement serves as a framework to ensure fair and equitable distribution of royalties to nonparticipating owners who have interests in the leased tracts. Under this agreement, nonparticipating owners, also known as royalty interest holders, are entitled to receive a percentage of the revenue generated from oil and gas production on the leased tracts. The specific percentage is usually negotiated between the parties involved and can vary depending on the terms of the lease and prevailing industry practices. The Puerto Rico Agreement Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease includes provisions related to the calculation and payment of royalties, reporting requirements, auditing processes, and dispute resolution mechanisms. It aims to create transparency and accountability in the payment process to ensure all nonparticipating owners receive their fair share of the generated revenue. It is important to note that there may be different types or variations of this agreement depending on the specific circumstances and parties involved. Common variations could include agreements specific to different segregated tracts, agreements with varying royalty percentages, or agreements tailored to specific oil and gas exploration and production projects in Puerto Rico. In summary, the Puerto Rico Agreement Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease is a legal document that establishes the framework for the payment of nonparticipating royalties on segregated tracts in Puerto Rico. It ensures that nonparticipating owners receive a fair share of the revenue generated from oil and gas production, providing transparency and accountability in the payment process.
