that is more practical for today’s complex title scenarios. One such method, employed by many Oklahoma practitioners, is to break up complex ownership into more manageable “bite-sized” interests based on grouping interests according to oil and gas lease burdens ( i . e ., common royalty and overriding royalty burdens). By way of example, the ownership Table 1, shown above, could also be presented as follows:
NET ACRES:
WORKING INTEREST:
C&R:
OWNER(S):
Av. N.R.I:
DECIMAL:
ORRI: LEASE:
Big Oil Company 44%*60%*4/5
1
+
26.400000% 2.812500% 0.312500% 16.666667% 16.666667% 3.808333% 33.333333%
42.240000 4.500000 0.500000 26.666667 26.666667 6.093333 53.333333
80.000000% 0.21120000 80.000000% 0.02250000 82.333333% 0.00257292 81.250000% 0.13541667 78.000000% 0.13000000 80.000000% 0.03046666 85.000000% 0.28333333
4.5/160*(5/6-3.333333%) +
a b
2, 3 2, 3 4, 5 4, 5
0.5/160*(5/6-1%)
+
1/6*13/16
+
16
1/6*(13/16-1.25%-2%) 3.80833333%*(86%-6%) + +
c d e
6
24
1/3*(*7/8-2.5%)
+
7-25
TOTAL:
100.000000% 160.000000
0.81548958
Table 2 : In summary, while historical fractions can provide transparency and a detailed account of title evolution, the practicalities of time, cost, and client utility often argue against their inclusion in large multi-tract units unless they directly serve the client’s specific needs or requests. The focus should be on delivering actionable, clear information that aligns with the client’s objectives, rather than an exhaustive historical lesson unless it adds significant value. 2. The NRI/Decimal Interest Distinction and the “Three column” Method Remember how we talked about net acres being a universal constant in multi-tract unit development? Well, another equally important universal constant is the lease net revenue interest. The use of nomenclature in title opinions can be confusing, however. Typically, in my experience, Oklahoma division order title opinions use Working Interest (WI), Net Revenue Interest (NRI) and Decimal interest (Decimal) 5 in the ownership tables. The NRI is the non-proportionately reduced lease revenue interest attached to the WI ( e . g . an 81.25% NRI lease would typically have a corresponding 3/16 royalty). While the Decimal interest is just the NRI, proportionately reduced down to the tract or unit size. However, NRI and Decimal interest are sometimes used interchangeably in title opinions. For example, the Table 1 column for NRI is in fact the proportionally reduced NRI (under the above definition), which is in turn represented as the Decimal column in Table 2 . Consequently, in our “three column” scenario the “ string-formula ” is baked into ownership Table 2 ( i . e ., the WI x the NRI = the Decimal). This set-up, more or less, corresponds to the string formula used in Table 1 under the owner’s name. As such, the inclusion of string formulas in Table 2 is considered a redundancy by many practitioners—and would be omitted entirely. Furthermore, the “two column” method in Table 1 of using only the WI column and the decimal interest (but is called NRI) column without giving a true lease (or lease group) Table 2 : In summary, while historical fractions can provide transparency and a detailed account of title evolution, the practicalities of time, cost, and client utility often argue against their inclusion in large multi- tract units unless they directly serve the client’s specific needs or requests. The focus should be on delivering actionable, clear information that aligns with the client’s objectives, rather than an exhaustive historical lesson unless it adds significant value. 2. The NRI/Decimal Interest Distinction and the “Three column” Method Remember how we talked about net acres being a universal constant in multi-tract unit development? Well, another equally important universal constant is the lease net revenue interest. The use of nomenclature in title opinions can be confusing, however. Typically, in my experience, Oklahoma division order title opinions use Working Interest (WI), Net Revenue Interest (NRI) and Decimal interest (Decimal) in the ownership tables. The NRI is the non-proportionately reduced lease revenue interest attached to the WI ( e . g . an 81.25% NRI lease would typically have a corresponding 3/16 royalty), while the Decimal interest is just the NRI, proportionately reduced down to the tract or unit size. However, NRI and Decimal interest are sometimes used interchangeably in title opinions. fact the proportionally reduced NRI (under the above definition), which is in turn represented as the Decimal column in Table 2 . Consequently, in our “three column” scenario the “ string-formula ” is baked into ownership Table 2 ( i . e ., the WI x the NRI = the Decimal). This set-up, more or less, corresponds to the string formula used in Table 1 under the owner’s name. As such, the inclusion of string formulas in Table 2 is considered a redundancy by many practitioners—and would be omitted entirely. Furthermore, the “two column” method in Table 1 of using only the WI column and the decimal interest (but is called NRI) column without giving a true lease (or lease group) NRI can be problematic for some clients. Increasingly, division order title opinions are used for more than just disbursing revenue. In fact, the use of the term “Drilling & Division Order Title Opinion” is reflective of the emerging dual use title opinion. For example, the WI (frequently not included in older Texas division order title opinions), is used by clients for accounting and joint interest billing purposes. Also, the use of a true lease NRI column can be a very convenient way for a land department or owner to quickly verify ownership percentages.
If you recall our discussion about net acres, we used the example of an owner with 4 net acres
For example, the Table 1 column for NRI is in
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G rowth T hrough E ducat i on - A pr i l / M ay / J une 2025
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