I just received two division orders for the same wells from COG Operating LLC. The wells are located in Upton County, TX. The first DO is titled 100% Oil and Gas Division Order. The second is titled Take In Kind Division Order. They both list the same wells. The Take In Kind DO shows the interest to be 1/2 of the interest in the 100% DO. Why two types of DO’s and why half the interest?
This is an unusual situation, and I’ve recently heard of another instance in Upton County where this happened. In that case, Concho had a take-in-kind (TIK) agreement in place with Chevron. None of the actual mineral/royalty owners are taking in kind…the Division Order is just poorly styled. In that case, the TIK split between Concho and Chevron was something around 50/50, and was made effective April of 2018. So, anything prior to that was paid 100% by Concho, and those DOs had the higher decimal interest. After 4/2018, Concho and Chevron were each sending DOs and payments to owners, so the DOs decimals would be approximately 50% of what they originally were (depending on the actual TIK allocation, whether exactly 50%, or something else). If the DOs you received have different effective dates, I imagine this is the situation you are in. You “should” also be hearing from the other TIK party. It may be quicker to get in pay if you remain proactive and follow-up with Concho, who is somewhat speedy about replying, and they can likely tell you who the other TIK party is, and what the split is. If it is Chevron, then I’d also advise remaining proactive and reaching out to them rather than waiting on them to mail you since they can be slow, and things do slip through the cracks. Hope this answer makes a bit of sense.
This does make a lot of sense. Thank you for responding.
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