One of the most confusing documents a mineral owner receives is the :Division Order. You open your mailbox, see a dense legal document from an oil company, and wonder: Am I selling my rights? Is this a bill?
Relax. A Division Order is simply a confirmation of your :decimal interest in a specific well.
What Is a Division Order?
When a new well comes online, the operator needs to know who to pay and how much. The Division Order is their way of asking you to verify:
- You are who you say you are
- Your ownership percentage is correct
- Your payment information is accurate
Signing it does NOT sell your minerals. It just authorizes the operator to start sending checks.
What to Verify Before Signing
1. Your Name and Address Sounds obvious, but typos here delay checks for months.
2. Property Description Does the :legal description match your deed? Check the survey, abstract, or section number.
3. Decimal Interest This is the magic number. It determines how much of each barrel’s revenue you receive. A typical decimal might look like: 0.00234567
If this number seems wrong, ask the operator for a :title opinion showing how they calculated it.
Common Questions
Do I have to sign it? Technically, no. But in Texas, if you don’t sign, the operator can pay you anyway after 6 months of holding your funds in suspense. Signing speeds things up.
What if my decimal is wrong? Don’t sign until it’s fixed. Contact the operator’s division order department with documentation supporting your claim.
What about the fine print? Some Division Orders include language that might limit your rights (like agreeing to certain payment deductions). Read carefully, or have an attorney review it.
We Can Help
If you don’t know how to calculate your decimal interest, give us a call. We help owners audit their decimals for free, even if you aren’t selling.
:division-order
A document issued by the operator of a well. It asks you to certify your ownership percentage and payment details. It is not a contract to sell your minerals—signing it simply authorizes the operator to pay you.
:decimal
Decimal Interest. Your ownership expressed as a fraction of the whole. Calculated from your acreage, royalty rate, and any historical conveyances. Even small differences in the sixth decimal place can mean hundreds of dollars over time.
:legal-description
The formal description of land based on surveys, sections, and abstracts—not a street address. Example: “The NE/4 of Section 12, Block A-45, PSL Survey, Reeves County, Texas.”
:title-opinion
A legal document prepared by a landman or attorney that traces the ownership history of minerals and calculates each owner’s share. Operators rely on title opinions to set up Division Orders.