What does the interest type UMI stand for?
Hi Melissa - UMI stands for Unleased Mineral Interest.
Hi, Melissa -
You didn't go into what context you ran across "UMI", but it could be Undivided Mineral Interest.
Hope this helps -
Charles Emery Tooke III
Certified Professional Landman
Fort Worth, Texas
Undivided Mineral Interest - the percentage of minerals owned by the person
and RI is the Royalty Interest - the royalty interest owned (mineral interest x the royalty provided for in the lease)
Gotcha. Then in that context, it would stand for Undivided Mineral Interest.
Your interest is a fraction of the minerals in a tract of land. If you own 10% of the minerals in a 40 acre tract of land, you own 4 acres of minerals in the 40 acre tract, or a 0.1 decimal interest.
It is Undivided, because you own part of the minerals in the entire 40 acre tract. If it were divided, you would own 100% of the minerals in a 4 acre tract.
My pleasure.
Sure. You own an undivided mineral interest when you own part, but not all, of the minerals under a tract.
For example, let's say your mother has four children and she owned all of the mineral in a 100 acre tract and she left them all to her children. Each of her children would individually own 1/4 (25%) of the minerals in the 100 acre tract. They would each individually own a 1/4 (25%) undivided mineral interest in the 100 acre tract. Such an interest can also be described as "25 net mineral acres" (being 1/4 of 100 acres) and as a 0.25 undivided mineral interest in the 100 acre tract.
If one of the children was to sign an Oil & Gas Lease with a 1/5 royalty, then that sibling would be entitled to 1/20 of the total production from the 100 acre tract (being a 1/5 royalty on the 1/4 undivided mineral interest).
On a Division Order it is important to show the size of the undivided mineral interest because it is part of the calculation of how much a particular person gets from the wells production. Let's assume the 100 acre tract was part of a 400 acre unit or pool. The sibling that signed the Oil & Gas Lease would be entitled to 1/80 of the production from the pool (100 acres divided by 400 acres times the 1/4 undivided mineral interest times the 1/5 royalty).
Make sense?
I have to admit that I have never seen that set of initials before. I would contact the operator to ask them exactly what they meant.
It is likely an undivided mineral interest, but why have it on a division order? That makes no sense, since you are paid on your share of production, not your mineral interest in an unit.
Best,
Buddy Cotten
Upon further reflection, I would make sure that the division order is on the state form and all references to the “UMI” are deleted.