My dad (passed in 2001) was landman and held a lot of small ORRIs throughout Oklahoma. I have old revenue statements in his name from Questar Exploration and Petroleum (QEP), Chesapeake, and Texaco that show paying ORs along with well names. I’m working on transferring these wells and have hit a snag. Some wells I can find the assignments recorded at the appropriate county clerk and determine well operators on the Oklahoma well lookup site. In those cases, the operators recognize him as an owner and I can transfer the wells out of the estate without problem.
For many wells, there are no assignments in the county records, even though the revenue statement shows the payout as overriding royalty. I can find the wells operators on the well lookup site and have revenue statements from one or more old operators. However the new operator does not have his name in their pay deck even though when I contact the old operator his name is in their records.
I suspect he was working for companies (Patrick Petroleum, Sinclair, Atlantic Richfield, Whiteshield, and later as a private consultant) … they set up the ORRI when the wells were initially drilled, but may have never recorded assignments. When the wells are sold (repeatedly in many cases) his name and interests slip through the cracks.
I’m trying to figure out if there is anything I can do without a recorded assignment/deed or if I am missing anything when searching county records.
My 1st question would be, if he passed away in 2001 and youre just now transferring those interests, whom has been getting paid on them for the last 14 years?
“many wells, there are no assignments in the county records, even though the revenue statement shows the payout as overriding royalty”? When did the new operators take over? Was whomever that took over his interest still getting paid on those interest from 2001 until when the new operator came in? Are those wells still producing?
Are the original leases still intact? If not, then the the ORRI’s may have expired for those leases that are no longer intact as did the leases. Another new lease after the fact of expiration of the original lease does not also renew the ORRI. At least that is my understanding? mk
In early 2018, I took over as the estate administrator and trustee of the family trust after my sibling passed. Some wells were in the trust but many were not. I’ve been making dispersements to the heirs ever year or two since taking over.
Most payments went to Oklahoma Unclaimed property which rarely lists any information other than the operator. I’ve been able to collect over five figures from unclaimed property and disperse it to the heirs.
I’m sorting through files and organizing things the best I can. I’m ignoring plugged wells and only looking at wells still operating. I assume even if the payout is very small, future drilling in a section could produce more under the ORRI.
Some wells have stayed with the same operator the whole time (Mewbourne for example). Others have transfer to operators multiple times.
Again my problem is wells where there is 1) documented revenue statements as an override royalty, 2) a change of operator who doesn’t have my dad’s name as an ORRI owner anymore, and 3) no assignment to be found in the online county recorder website.
This seems to make the most sense. The ORRI we have in our files show that the interest should continue even if a new lease is put in place.
The real problem is when we have old revenue statements showing payments to my dad as an overriding royalty but I can not find any assignment in the county records. How would this situation happen since I figured ORRI assignments should alway be recorded.
@Ruth_Anderson - An ORRI is carved out of existing OGL or OGLs related to an Area of Mutual Interest (AMI). If the OGL expires, then the ORRI will expire unless there is a new OGL by an affiliated entity. If a new company enters into an OGL on the property that is not affiliated with the AMI, then the ORRI will not renew.
Depending on the dates of the AORRI, OKCountyRecords may not have them in the index and a chain of title will be impossible to develop from online sources. This will require a title search in the courthouse. If an AORRI is not filed, then it has no affect on the current title.
Revenue statements indicate title, but are not title themselves when you have a dependent interest such as an ORRI. This could explain an operator that does not have the name in the current pay deck. An OGL lapses due to production and a new OGL on the same property with the same lease name is taken up by a different operator may offer a potential answer.
Thank you James for the explanation. In regards to your last paragraph, here is what I think you are saying … an OGL and hence ORRI could lapse if it is not a producing well. I understood an ORRI does not renew if a well was plugged in an AMI before a new well was drilled. However, I did not understand if a well was not producing, an OGL could expire even though the well was not plugged.
What I believe is happening is the OGL for a “low producing” well is being sold from one operator, to the next, and to the next. Some production still exists, but would not payout to my dad because his OR interest is so small. I’m wondering if I should still pursue these interests in the event new wells are drilled in the same AMI? Thoughts?
OK has a requirement to pay royalty owners at least annually regardless of the amount. So you should at least receive minimum payments on wells. OK also has a temporary abandonment rule (I believe 2 years) that undermines the paying quantities clause of most OGLs.
I advise developing plats of the OGL’s where the ORRI applies and entering relevant well data. You will need to also get copies of the original OGLs related to the ORRI. With this base information, you can review OCC records on continuous production as well as start a review of your record title.
A title review should include searches for releases of OGL (not a common practice anymore) and new OGLs from the same lessor (indicates an expired OGL). Unless you have significant income from the ORRI, this review may be cost prohibitive unless you are capable of performing the review.
Good luck to you. Write back if you need other thoughts.
Landman here… I have seen instances where people get paid ORRI on wells but assignments don’t get filed of record. These ORRIs were for people who worked for the operator and were given the interests internally (literally scribbled in the margins of pay decks in pen by the company owner), but official assignments never got filed. If that’s what’s happening here, it’s an uphill battle to get these interests in your name. It’s been a long time since your father passed away. It’s likely anyone who had any knowledge of these interests at the time are no longer working or may be deceased as well. Essentially, I think you’d need to get the original operators to put in writing the interests your father was credited with and then present that to the current operator. You’re basically going to have to rely on the good will of the current WI owners that these ORRIs originally burdened. If they are willing to accept that your father did in fact have interest, you are still going to need to file something of record (like a stipulation of interest or an assignment of ORRI from the current WI owners) at the county level, and everyone whose interests are involved are going to have to agree to it and sign the document. And that’s all assuming that the leases that were in effect when your father received the ORRIs are the current leases today. If these wells are being operated under new leases, that’s a different story. Likely any interest your dad may have owned would no longer apply to new leases, especially if there was no original assignment. You would likely need to hire an O&G law attorney to help you. They may just tell you outright that the ORRIs that don’t have official assignments filed may not be worth pursuing.
When you say that you can’t find any assignments in the county clerk’s records, is that based on a search of okcountyrecords.com, an index search, or a search of all assignments from the original and successor lessees?
The reason I ask this is if Company A is to assign an orri to B, C, & D, many times the okcountyrecords.com will show assignment to “B, et al.”.One then has to review the actual assignment to find your father’s name. It won’t show up in the index.
Based strictly on the search in okcountyrecords.com for my dad’s last name. So if he is part of et al you are saying his last name would not show up in the index search. So I should be reading all of the assignments based on the legal description (section township range) over a time span when the well first went into operation? Is there a better way to narrow it down?
Did your lather work for a company that gave or offered the orris to its employees or principals? If so, look for assignments out of that company.
It is very likely that any assignment into your father happened very early on in the production of the well. If so, you can always look for the early assignment out that original company.
Third, don’t get too hung up on locating the leases if all you are doing is transferring them to you or a closely-held trust. You could just assign all of grantor’s interest in the orri in the NE/4 for example. Even if you didn’t know the lease(s) involved, this would be a valid transfer of the orri.
What Tim is saying, since it sounds like you know who your dad got his interest from, look for that name and any type of assignments that come from them for that section, if their are multiple parties they often wont be listed so you have to spend the money on okcounty to review the doccument, think its a $1 per instrument.
But there are many layers to this unfortunately. An ORRI is attached to the OGL and Lessor that assigned it. It does not carry on to new OGL’s. If the OGL’s had depth clauses, even if they drilled a well on the same property, the ORRI wouldnt be included as it would be leased by someone else. If the wells are marginally producing, there isnt enough money made to be distrubuted.
Separate them first by companies that are alike. Then you can deal with each company and all the ORRI’s that are with that company at the same time. Hopefully!
Okay looking over okcountyrecords.com website what I am seeing is assignments directly to his and others names in the late 1970s by Patrick Petroleum. In the early 1980’s I am seeing assignments from Patrick Petroleum to limited partnerships within Patrick Petroleum. How would I go about finding information about those limited partnerships to see his name is included?
MK