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solution with steps please Mr. Z owns the mineral interests in some land in Kuwait. He leases the land to AL Fanar Oil Co., reserving
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Mr. Z owns the mineral interests in some land in Kuwait. He leases the land to AL Fanar Oil Co., reserving a 1/8 royalty. During 2007. Al-Fanar Oil Co. makes the following assignments: 1- To Mr. Jones, an ORI of 1/7 of Al-Fanar Oil Coi's interest. 2- To Mr. Brown. 1 PPI of of Al-Fanar Oil Coi's interest. 3- To Mr. Smith, a joint working interest as 1/3 after giving consideration to all the above assignments. During 2007, Al-Fanar Oil Co. drills a successful well and 160,000 barrels of oil were produced and sold. During the year development and operation costs totaled $120,000 divided between the appropriate parties based upon number of barrels received. Required: 2. Present the above assignments in a flowchart assuming that Al-Fanar Oil Co. remains the working interest in all these assignments? 3. How much barrels will each party receive ? How much of the costs will each party payStep by Step Solution
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