Question
Two leases in Northern Nevada are being combined to form the North Unit. Lease 1 WI: 100% Silver State Co. RI: 1/8 Betty Grey 1/10
Two leases in Northern Nevada are being combined to form the North Unit.
Lease 1
WI: 100% Silver State Co.
RI: 1/8 Betty Grey
1/10 Mark Green
Acreage contributed: 550 acres
Estimated net recoverable bbls: 250,000 bbls
Lease 2
WI: 70% Mountain Ridge Ltd
30% High Desert Inc.
RI: 1/3 Frank Brown
Acreage contributed: 350 acres
Estimated net recoverable bbls: 300,000 bbls
Requirement:
a. Determine the participation factors for each party based on the acreage contributed.
b. Determine the participation factors for each party based on the net recoverable barrels contributed.
c. Determine the participation factors for each party based on the acreage contributed weighted 50% and the net recoverable barrels weighted 50%.
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