Texas Assignment of Overriding Royalty Interests of a Percentage of Assignor's Net Revenue Interest, After Deductions of Certain Costs - Effectively A Net Profits

• Category: Oil Gas and Minerals - Assignments
• State: Multi-State
• Control #: US-OG-284
• Format: Word; Rich Text

Description

This form is used by the Assignor to transfer, assign, and convey to Assignee an overriding royalty interest in a Lease and all oil, gas and other minerals produced, saved and sold from the Lease and Land. A Texas Assignment of Overriding Royalty Interests of a Percentage of Assignor's Net Revenue Interest, After Deductions of Certain Costs — effectively a net profitarrangementen— - is a legal agreement commonly used in the oil and gas industry. This contract allows an assignor to transfer a portion of their net revenue interest to an assignee, who then earns overriding royalties on any profits generated from the assigned interest. In simpler terms, this agreement grants the assignee the right to receive a percentage of the assignor's net revenue interest (NRI). The NRI represents the assignor's share of revenue from the production and sale of oil, gas, or other mineral resources extracted from a specific lease or production unit. However, the assignment of overriding royalty interests only becomes effective after certain costs are deducted from the assignor's NRI. These costs typically include production expenses, operating costs, taxes, and other applicable deductions. After these deductions, the assignor's net profits are determined, and the assignee will then receive a portion of these net profits based on the assigned percentage. It's important to note that there are different variations of the Texas Assignment of Overriding Royalty Interests, each tailored to specific requirements and conditions. Some common types include: 1. Fixed Percentage Assignment: In this type, the assignor transfers a fixed percentage of their NRI to the assignee. The assignee will then receive a consistent share of the net profits generated by the assignor's interest throughout the term of the agreement. 2. Sliding Scale Assignment: This variation allows the assignor to assign a percentage of their NRI that varies based on specific revenue thresholds or other predetermined criteria. For example, the assignor may assign a lower percentage of their NRI until a certain revenue threshold is reached, after which a higher percentage is assigned. 3. Term Assignment: Under this arrangement, the assignment of overriding royalty interests is effective for a specific period, usually defined in the agreement. At the end of the term, the assignor regains full control of their NRI. 4. Partial Assignment: Instead of assigning a percentage of their entire NRI, the assignor may choose to transfer a portion of their NRI related to a specific lease or a designated part of the production unit. Overall, a Texas Assignment of Overriding Royalty Interests of a Percentage of Assignor's Net Revenue Interest, After Deductions of Certain Costs, provides a mechanism for assigning a portion of an assignor's NRI to an assignee, allowing the assignee to earn overriding royalties on the assignor's net profits. The specific terms and conditions of the assignment can vary depending on the parties involved and their negotiated agreement.

A Texas Assignment of Overriding Royalty Interests of a Percentage of Assignor's Net Revenue Interest, After Deductions of Certain Costs — effectively a net profitarrangementen— - is a legal agreement commonly used in the oil and gas industry. This contract allows an assignor to transfer a portion of their net revenue interest to an assignee, who then earns overriding royalties on any profits generated from the assigned interest. In simpler terms, this agreement grants the assignee the right to receive a percentage of the assignor's net revenue interest (NRI). The NRI represents the assignor's share of revenue from the production and sale of oil, gas, or other mineral resources extracted from a specific lease or production unit. However, the assignment of overriding royalty interests only becomes effective after certain costs are deducted from the assignor's NRI. These costs typically include production expenses, operating costs, taxes, and other applicable deductions. After these deductions, the assignor's net profits are determined, and the assignee will then receive a portion of these net profits based on the assigned percentage. It's important to note that there are different variations of the Texas Assignment of Overriding Royalty Interests, each tailored to specific requirements and conditions. Some common types include: 1. Fixed Percentage Assignment: In this type, the assignor transfers a fixed percentage of their NRI to the assignee. The assignee will then receive a consistent share of the net profits generated by the assignor's interest throughout the term of the agreement. 2. Sliding Scale Assignment: This variation allows the assignor to assign a percentage of their NRI that varies based on specific revenue thresholds or other predetermined criteria. For example, the assignor may assign a lower percentage of their NRI until a certain revenue threshold is reached, after which a higher percentage is assigned. 3. Term Assignment: Under this arrangement, the assignment of overriding royalty interests is effective for a specific period, usually defined in the agreement. At the end of the term, the assignor regains full control of their NRI. 4. Partial Assignment: Instead of assigning a percentage of their entire NRI, the assignor may choose to transfer a portion of their NRI related to a specific lease or a designated part of the production unit. Overall, a Texas Assignment of Overriding Royalty Interests of a Percentage of Assignor's Net Revenue Interest, After Deductions of Certain Costs, provides a mechanism for assigning a portion of an assignor's NRI to an assignee, allowing the assignee to earn overriding royalties on the assignor's net profits. The specific terms and conditions of the assignment can vary depending on the parties involved and their negotiated agreement.