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Oil/Gas/Division order


Good afternoon
I am a mineral owner in Logan County Oklahoma.  The driller drilled a well back in May, 2015.  They have mailed me a division order.  I am brand new to all of this and so I have hesitated to sign it until I get expert advice.  It was hard enough to do the lease and know that did everything right.  Can you explain division orders?  What I should look out for?  How to figure up the right percentage?  Any other advice, suggestions would be greatly appreciated.

First, read the contents of the division order carefully. Compare what it is saying to what you worked so hard to either include or exclude from your lease before you signed it. One example would be warranty language: does your lease specifically say that you do not warrant your claimed ownership in the land, and any money paid to you in error based on the amount of your mineral rights interest can't be recouped? Most likely the division order says that if they overpay you in royalties you warrant your interest, so you are agreeing to pay back the overpayment.

A very good "go by" to help you with this is the NADOA 1995 Model Division Order. Visit  Click the word "Publications" near the top of the screen. Scroll down to "MODEL FORM DO" and click the orange button, "MODEL FORM". Download and print a copy of that model division order. Using it, you can choose to draw a line through any provision in the company's division order that is not found in the model division order. Warning: any words or sentences that you draw a line through, you must put your initials next to it in the margin, otherwise the signed division order can be rejected by the company.

Now for the calculation. The formula used for calculating a royalty interest is:

[% of Mineral Interest] x [Lease royalty fraction stated in the lease LESS any fraction or decimal or % of non-participating royalty interest that must be deducted from your royalty, if any] x [Number of GROSS acres of your land inside the pooled unit] DIVIDED BY [the total number of acres in the pooled unit].  The company division order you received should state the legal description for the well, including the total number of acres in the pooled unit. If it does not, contact the company using the contact information in the instruction letter that should have been included with the division order. This is the basic formula, but if the division order is for a multiple-unit well, this formula must be multiplied by what is called a "wellbore lateral allocation". The division order analyst at the company can help you re-create the calculation formula that he/she used to arrive at the decimal shown in your division order.

Let me know if you need additional help, using a follow-up question.  Thank you for choosing me as your expert.


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Marsha Breazeale, M.Ed., CDOA, CPLTA


All questions regarding division orders; ownership decimal calculations; title ownership and payer record changes (testate/intestate inheritance; deed; assignment; court order); oil and gas lease analysis for record-keeping and purposes of payment by operator or payer; pooling, horizontal wells, horizontal well allocation units; unclaimed property reporting; royalty owner relations questions. All questions concerning administration of surface land contracts and payment questions, such as for Surface Right-of-Way, Sub-Surface Right-of-Way, Easement, Surface Use Agreement. All questions regarding industry-standard and company-specific policies that affect land owners.


Sr. Staff Division Order Analyst. Certified Division Order Analyst (CDOA, National Association of Division Order Analysts) and Certified Lease Analyst (CPLTA, National Association of Professional Lease and Title Analysts) with 35 years of experience as a combination division order analyst and lease analyst in exploration and production in the oil and gas industry.

National Assoc. of Division Order Analysts (NADOA), National Association of Division Order Analysts (NALTA), American Association of Professional Landmen (AAPL), American Society of Trainers and Developers (ASTD)

"How an Oil & Gas Exploration & Production Company Operates" and "Principles of Oil & Gas Lease Analysis: Standard Clauses", Oil Patch Press; Articles in NADOA Magazine; LandFocus EDU Professional Training Manuals

Education/Credentials Management from Our Lady of the Lake University in San Antonio; M.Ed. in Instructional Design from WGU Texas.

Past/Present Clients
Past 15 years: GeoSouthern Energy Corporation; Contango Oil Co./Crimson Exploration & Operating Inc.; Apache Corporation; BP America; Marathon Oil; Newfield Exploration

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