I’m trying to determine what “Type of Interest” and “Interest” (decimal amount) should occur on a newly received Division Order. Please bear with me as I give necessary background that pertains to my questions.
Background Information:
1. This concerns minerals in Texas that have been passed down thru multiple generations. The fractional interests have changed over time as additional people have each received a smaller fraction of the original interest. The following language appears in the first in the sequence of recorded documents recently found. This recorded document from 1925 had no “heading” (such as “Mineral Deed”, “Royalty Deed”, etc.) labeling this document.
(Note: Words appearing between brackets are my own. I’ve shortened the actual wording that appears in this document (“granted, sold, conveyed, assigned and delivered” = {conveyed}; “oil, gas, etc….” = {product}; land legal description has been left off …… to make this posting as brief as I can.)
“Party A {conveyed} to Party B a royalty interest of 1/16 of all {product} hereafter produced together with an equivalent reversionary interest in and to all {product} in and under the following described land ……”
“Above described land being now under an oil and gas lease {to oil company}, it is understood and agreed that this sale is made subject to the terms and conditions of said lease, and the royalty interest hereby conveyed is a 1/2 part of royalty provided by said lease {lease showed a 1/8 royalty}, to be paid. But the royalty interest hereby conveyed shall be a covenant running with said land in perpetuity and shall be provided for in any future lease or sale of the {product} on and under the above described land.
It is understood that the 1/16 {1/2 x 1/8} interest herein conveyed is a royalty interest only, and the Grantee by reason of the possible reversionary interest in the {product} in and under said lands shall have no interest in any rental, bonuses, or any other revenues or moneys other than the royalties received or derived from the lease or sale of said land, and neither the Grantee herein nor his heirs or assigns, shall have any control over the lease or sale of said lands, for mineral or other purposes, and for the purpose of leasing, selling or making any other contracts for the development and production of the minerals in said land, the Grantors are expressly made the Agents of the Grantee and it shall not be necessary to consult the Grantee in any way with respect thereto; but in case {product} shall at any time hereafter, be produced from said land, then and in that event, the Grantee shall receive a 1/16 of same so produced and saved as royalty which shall be delivered to the Grantee, his heirs and assigns.”
So it seems that Party B now has a 1/16 interest.
2. Party B conveyed to Party C (in a document with the heading of “Mineral Deed”) a 1/2 interest in Party B’s interest, using the exact same language as shown in Item #1 above. So it seems Party C now has a {1/2 x 1/16} 1/32 interest .
3. Party C conveyed to Party D (in a document with the heading of “Royalty Deed”) 1/2 of the 1/32 interest Party C receive from Party B , but used the following language:
“ Party C has {conveyed} to Party D a royalty interest of {1/64} of all [product] hereafter produced and saved from, together with an equivalent reversionary interest in and to all [product] in and under the following described land ……. “
“The royalty and reversionary interest, above described, and herein conveyed, is {1/2 of the 1/32} royalty and reversionary interest in said land conveyed to me (Party C, by Party B)) by deed {recorded in Vol. “x”, Page “y”; this deed contained the same language as shown in Item #1 above} in to which deed and the record thereof, reference is here made for all purposes, and this conveyance is subject to all of the terms and conditions of said deed which are here referred to.”
To have and to hold the interest above conveyed, together with all and singular, the rights and appurtenances thereto and in anywise belonging unto the said Party D , his heirs and assigns forever, it”
being expressly understood that this conveyance is without warranty of title either express or implied and without any recourse on me.”
So it seems Party D now has a 1/64 interest.
4. The deed described in Item #3 above was subsequently conveyed (in a recorded document that made NO REFERENCE to the language shown in Items #1, #2 & #3 above) from Party D to Party E via Probate. For simplicity let’s say that Party E received 1/2 of Party D’s 1/64 interest. So it seems that Party E now has 1/128 interest.
5. Party E conveyed their full interest of 1/128 (via “Mineral Deed”) to Party F . I am Party F and if the Mineral Deed I received from Party E shows that I own 1/2 of 1/64 that would mean I own 1/128.
I have recently received a Division Order (D.O.) for a new well (located in the area covered by the above conveyances) which asks that I verify the accuracy of the “Type of Interest” and the “Interest” (shown as a decimal amount) that appears on the D.O.
My Questions:
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What is the meaning of “ Reversionary Interest ” as shown in the above deed language …… and how, if at all, would the meaning of “Reversionary Interest” effect my verifying the accuracy of information that is shown on the D.O.?
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Am I correct that the language in the conveyances shown in Items #1, #2 & #3 above (and I’ve found NO evidence that the language in #3 above has been changed over the years) would pertain to me as Party F? If that’s correct, does that mean that the “Type of Interest” on the Division Order I recently received should be shown as “ NPRI -Non-Participating Royal Interest ” and not as a “RI - Royalty Interest ”??
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To verify, if it’s a “NPRI” Type of Interest does that mean that I [ Party F ] am not able to sign leases, collect leasing bonuses, etc? I only have right to collect a royalty payment in the fractional amount as shown on the Mineral Deed that was conveyed to me?
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How to calculate what my “Interest” (decimal) as it should appear on the D.O. if this is a NPRI?
With a NPRI, does my “Interest” that would appear on at Division Order always remain the same regardless of what royalty amount is shown in any lease (since lease royalty amount may vary from lease to lease over the years)? In other words, if my Mineral Deed shows that I own say 1/2 of 1/64 (which is .0078125) is that what my “Interest” should be shown as on a D.O. ……… and the royalty fraction that would appear in any lease would NOT be used as part of the “Interest” calculation to be shown on the D.O of a NPRI?
Apologies for the length of this post but I want to provide adequate info. to explain my questions.