Hierarchy
IS-OIL (Software Component) IS-OIL⤷
IS-OIL-PRA-REP-ROY (Application Component) Royalty Reporting⤷
OIU_REP (Package) Production, Tax & Royalty Reporting
Basic Data
| Data Element | OIUREP_MMS_2014_COMP_ROY_FL |
| Short Description | Production: MMS-2014 - Compensatory Royalty Flag |
Data Type
| Category of Dictionary Type | D | Domain |
| Type of Object Referenced | No Information | |
| Domain / Name of Reference Type | YESNO | |
| Data Type | CHAR | Character String |
| Length | 1 | |
| Decimal Places | 0 | |
| Output Length | 1 | |
| Value Table |
Further Characteristics
| Search Help: Name | ||
| Search Help: Parameters | ||
| Parameter ID | ||
| Default Component name | ||
| Change document | ||
| No Input History | ||
| Basic direction is set to LTR | ||
| No BIDI Filtering |
Field Label
| Length | Field Label | |
| Short | 10 | Comp Roy |
| Medium | 15 | Comp Roy Flag |
| Long | 20 | Compens Royalty Flag |
| Heading | 25 | Compensatory Royalty Flag |
Documentation
Definition
Compensatory royalty is a royalty value due on oil and gas that has been drained from Federal or Indian land by a well on another property.
It can also be a royalty paid in lieu of drilling a well that would otherwise be required under the convenants of a lease, express or implied. When a lessee has leases covering two or more contiguous tracts, such as tract A and B, and drills a well on tract A, it normally is obligated under the offset well covenant to drill a well on tract B. If existing development of the two tracts is adequate to recover the oil or gas in place, the lessee may elect to pay the royalty owners of tract B a compensatory royalty in lieu of the expense of drilling the offset well.
A compensatory royalty agreement is an agreement developed for unleased Federal or Indian land being drained by a well located on adjacent land.
History
| Last changed by/on | SAP | 20050224 |
| SAP Release Created in | 46C |
