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.
The Allegheny Pennsylvania Agreement Governing Payment of Nonparticipating Royalty Under Segregated Tracts Covered by one Oil and Gas Lease is a legal and contractual document specifically designed to outline the terms and conditions for the payment of nonparticipating royalty owners (NPR) in relation to oil and gas extraction activities. This agreement applies to segregated tracts covered by a single oil and gas lease within the Allegheny, Pennsylvania region. Key Features of the Allegheny Pennsylvania Agreement: 1. Nonparticipating Royalty Owners (NPR): The agreement addresses the rights and entitlements of nonparticipating royalty owners. NPR do not hold any working interest in the lease but are entitled to receive a specified percentage of royalties derived from the production on their segregated tracts. 2. Segregated Tracts: The agreement defines the concept of segregated tracts, which refers to specific portions of land within the lease area that have been legally separated or segregated. Each segregated tract may have different NPR and their respective royalty interests. 3. Royalty Calculation and Payment: The agreement establishes the methodology for calculating the royalties owed to NPR based on the production volume and prevailing royalty rates. It also outlines the frequency and manner of payment, usually in the form of a monetary distribution at regular intervals. 4. Lease Operator Responsibilities: The agreement imposes obligations on the lease operator to accurately measure and report the amount of oil and gas production from each segregated tract. It also outlines the operator's responsibility to calculate and distribute accurate royalty payments to the NPR in a timely manner. 5. Rights and Remedies: The agreement may specify the rights, remedies, and recourse available to both the NPR and the lease operator in case of disputes or breaches of the agreement. This may include provisions for mediation, arbitration, or litigation to settle disagreements. Types of Allegheny Pennsylvania Agreement: 1. Allegheny Pennsylvania Agreement for Individual Segregated Tracts: This type of agreement is specific to a single segregated tract covered by an oil and gas lease. It details the unique terms and conditions applicable to that particular tract and its NPR. 2. Allegheny Pennsylvania Master Agreement: A master agreement is a broader framework that covers multiple segregated tracts within a single lease. It sets out general terms and conditions, such as royalty calculation formulas, payment schedules, and dispute resolution procedures. Individual segregated tracts may be treated as supplemental agreements to the master agreement. By implementing the Allegheny Pennsylvania Agreement Governing Payment of Nonparticipating Royalty Under Segregated Tracts, the interests of NPR are protected, ensuring fair compensation for their royalty rights in the extraction of oil and gas resources within the Allegheny region of Pennsylvania.
