Calculating Division Orders, Title Opinions, & Critical Lease Clauses That Impact the Royalty Owner

We examine the critical royalty clause and the alternative wording and meaning of typical royalty clauses. We also cover the Shut-In Royalty, Delay Rental clauses, overriding royalty interests, and royalty interest calculations. We discuss the reasons and formulas for calculating net mineral acres, gross working interest, net revenue interest, and the impact of the Proportionate Reduction & Pooling clauses. Major topics include:

  • Understanding the measurement of costs and revenue for effective decision making.
  • Impact of the Proportionate Reduction and Pooling clauses on other clauses in the lease and the division of interest.
  • Division orders and transfer letters, JIBs, and rights of working interest owners.


“My family has owned land in the Eagle Ford Shale for 5 generations. When landmen started to call, the family asked me to take over the management of the minerals and honestly I didn’t know where to begin. This program gave me the knowledge and confidence to step up to this challenge and start getting the job done.” (NARO Member in south Texas)

“It is too bad that more instructors don’t have the charisma and passion that George Wilson has. I signed up for the program expecting to hear a bunch of legal mumbo-jumbo, but he made a dull subject interesting and even exciting.” (Mineral Owner in Central Texas)

“Thanks to the TCU staff for taking such good care of us throughout the program. You were attentive, supportive, and very helpful. The food was good and the networking was great. I made some new best friends that I will stay in touch with.” (Mineral Owner in San Antonio)

“I am a 75 year old land owner who has been approached about drilling on my property. Since my wife and I want to slow down, we took two of our kids to this program to see if they want to take over the minerals now rather than when we are gone. They learned so much that they are interested in taking over. This big burden has been lifted from our shoulders.” (Land Owner in Oklahoma)

“My family has owned minerals in Pennsylvania for many years and I have been looking for a program like this for a long time. I found out about the program from NARO and signed up immediately. I made 3 trips to Fort Worth and it was worth every penny.” (Pennsylvania Mineral Owner & NARO member)

“I am an independent landman and my family owns a lot of minerals. I decided to sign up for the program because the family looks to me for advice. I am now a better landman because I understand the perspectives of the mineral owner much better.” (Landman and AAPL member)

“My family owns a fairly large ranch in south Texas and we have been raising cattle and providing deer hunting for many years. The Eagle Ford Shale boom provided the possibility of a whole new source of income for me and my family. I signed up for this program and it made all the difference in the world. I would recommend it to any rancher.” (Rancher & NARO member in south Texas)

“When I first found out about the program, it seemed a little pricy for my budget. I signed up and I am so glad that I did. I learned so much and the extras made a big difference in my comfort. The notebook is a great resource that I will use for years to come.” (Mineral Owner in west Texas)

NOTE: These testimonials were provided verbally and in writing during the Royalty Owner Programs in Fort Worth and San Antonio.


Our instructors look forward to providing you with the best learning experience possible and the knowledge to take your energy development to the next level.

George Wilson, J.D., C.M.M.

George H. Wilson, II is founder and principal of Wilson Consulting, a privately-held business enterprise devoted to the education of and issues concerning independent royalty owners. He advises clients on all aspects of minerals management and negotiations and is recognized in Texas, Oklahoma and Colorado for his work as an advocate for fair and equitable leasing practices. George serves as the TCU Energy Institute Legal Scholar in Minerals Management and teaches regularly in Royalty Owner Programs.

George received his Doctorate of Jurisprudence Degree from the University of Tulsa and began his private law practice in Oklahoma in the early 1970s. He was admitted to the Federal U.S. District Court for the Western District of Oklahoma and to the 10th Circuit of the United States Court of Appeals during his time there. In 1981, he was appointed to the office of United States Magistrate in the Western District of Oklahoma and became a City Judge in 1991. George’s law practice has spanned 30 years and throughout his career he has provided leadership and counsel in many aspects of law related to the oil and gas industry.

An active leader in the National Association of Royalty Owners (NARO), George has served on the NARO Board of Directors, was Vice-President of the national organization, and led the NARO Ethics Committee. He has been named to the Board of Directors of both Oklahoma NARO and NARO Texas and is a frequent contributor to the organization’s publication, ROAR.

A Certified Minerals Manager, George is a frequent speaker in cities across the U.S. on topics of importance to royalty owners. Known for his high energy and entertaining style, George educates land owners in all aspects of the management and leasing process including “Techniques of Minerals Management,” “Leasing: How to Mine the Underground,” “Leasing Clauses and Other Protection,” “Dealing and Negotiating with the Landman,” “Surface Damages: Know Your Rights,” and more.

George lives in Dallas, TX, where he maintains his consulting and management practice.

Glen Webb, MBA, J.D.

Glen is a successful attorney and business owner in Abilene, TX. He received a BA from Texas A&M University, an MBA from Texas Tech University, and a Doctor of Jurisprudence and Master of Laws (Taxation) from Southern Methodist University. Glen’s practice is weighted toward the interests of mineral and royalty owners in West Texas and around the State of Texas. In addition to oil & gas minerals management, Glen is an expert in estate planning and tax mitigation.

Prior to forming his own law firm and abstract company in 2009, Glen was an attorney and shareholder in two large law firms in Dallas and Abilene. He acquired extensive hands-on experience in all aspects of oil & gas operations and minerals management, including lease negotiations, working interests, joint operating agreements, title curative, estate and tax planning, real estate, and wealth management. Glen has a special passion for mineral and royalty owners who want to acquire the knowledge and experience to level the playing field when they interact with oil and gas companies.

Glen is a born teacher and serves as an instructor in oil and gas operations at McMurry University in Abilene. He was appointed by Governor Rick Perry to be a member of the Texas Farm and Ranch Council in 2006 and previously served as the President of the Texas Wildlife Association. He is an Eagle Scout and was named as a Top Young Lawyer in Texas by Texas Monthly in 2006. Glen has published several legal articles, including “Saving the Family Farm and Ranch,” which was published in Texas Wildlife. Also, Glen wrote the Texas Wildlife Association’s amicus brief to the Texas Supreme Court in the seminal water law case, Guitar Holding Co., LP v. Hudspeth County Underground Water District.

When he is not practicing law, Glen operates his family’s ranch properties in Throckmorton, Texas, which conducts commercial hunting and cow/calf operations. Most importantly, Glen loves spending time with his family, at the ranch, at the ballpark, or one of their regular “Family Nights” in Abilene. Hands down, Glen’s proudest accomplishment is his marriage to Misti and his two children, William and Ella Grace.

David Sikes, C.M.M.

David is a native Oklahoman and the third generation of his family to work in the energy industry. After earning an MFA from Chelsea University and managing his family’s business for 20 years, he is now a principal with Jeroco, Inc., where for the past 12 years as the Director of Operations he has managed the company’s mineral and working interests. Jeroco is a non-operating oil and gas company based in Chickasha, Oklahoma. He is also involved in managing the mineral assets of many clients that include personal holdings as well as bank trusts and university foundations.

David has been a member of the National Association of Royalty Owners (NARO) for many years and he has served in a number of important leadership roles. He was a member of the National Advisory Council to NARO. In 2012, David began his tenure as National President of NARO. He is the immediate past president of the OK-NARO Board having served 2 terms as OK-NARO President.

David travels to Washington, D.C. as a representative of NARO to ensure that national policy-makers understand and support the interests of mineral owners around the country. In September of 2012, David testified before a Congressional Energy Tax Committee at the request of Representative Cory Gardner (R-CO 4th). He provided information to the members of congress about percentage depletion and how the elimination of tax incentives will hurt royalty owners nationwide. In 2012, NARO helped form the Royalty Owners and Producers Education Coalition (ROPE) where David serves as a founding board member.

David earned his Professional Certified Mineral Manger status from NARO in 2006. He serves on the board of the Grady County Mineral Owners Association. A born teacher, David was an adjunct professor at the University of Science and Arts of Oklahoma for 10 years. As an advocate for the education of mineral owners, David continues to speak on a variety of topics nationwide.

He has been married to his wife Michele for 34 years and they make their home in Chickasha, OK. David is a member and past president of the Chickasha Rotary Club and continues to be very active in Boy Scouting primarily as a consultant and facilitator for leadership training, both adult and youth.

David is a frequent lecturer as well as an Expert Panel member for NARO.

David W. Wallace, J.D.

David Wallace received a B.B.A. in Petroleum Land Management in 1978 from the University of Texas, studied law at Cambridge University (Emmanuel College), the University of Richmond, and graduated from South Texas College of Law. He was admitted to the State Bar of Texas in 1982 and Board Certified in Oil, Gas and Energy Law by the Texas Board of Legal Specialization in 1989. He has also served as Sutton County Attorney since 1985.

His practice is weighted heavily to representation of landowners, especially royalty and mineral owners, in oil, gas and mineral transactions and litigation. He is a former COUNCIL MEMBER for THE OIL, GAS & MINERAL LAW SECTION FOR THE STATE BAR OF TEXAS and a life fellow of the Texas Bar Foundation. He was also an EXECUTIVE DIRECTOR on the MOHAIR COUNCIL OF AMERICA and he is presently a director of NARO Texas

David is a prolific author, presenter, and teacher on a wide range of topics that are relevant to surface and mineral owners. Some of his more recent publications include the following:

    • Royalty and Revenue Accounting
    • Area of Mutual Interest, (co-authored)
    • Hints on Negotiating of an Oil and Gas Lease & Protection of Royalty Income
    • The Lessor’s Viewpoint on Negotiation of an Oil and Gas Lease & Protection of Royalty Income
    • The Ten Most Important Royalty Cases
    • Anatomy of an Oil and Gas Lease
    • Royalty Issues in Unconventional Plays and Times
    • Focal Points of Oil And Gas Lease Negotiations, Lessor's Perspective
    • Advanced Mineral Management and Leasing
    • Unconventional Plays History and Future – Potential Legal Issues
    • Surface Rights Including the Accommodation Doctrine

David is a frequent presenter at conferences sponsored by the National Association of Royalty Owners (NARO) and the State Bar of Texas. He has been an invited presenter at numerous energy industry conferences and events. David has a passion for teaching and advising mineral owners so they can take full advantage of their mineral assets. He is also a well-known litigator in protecting the rights of mineral owners in the court room.

David and his wife Beth, who is also an attorney, live in Sonora, Texas. David and Beth have two children, Wilson Wallace, an oil and gas attorney in Midland and Warren a graduate of TCU’s Ranch Management School, who is a law student at Texas Tech University in Lubbock. David is a fourth generation rancher on a family ranch near Sonora and raises sheep, goats and cattle. David is also a mineral and royalty owner.

Ken Morgan, Ph.D.

Dr. Morgan obtained degrees in geology, environmental engineering, and resource management before starting his career as a professor at TCU in 1978. He started and became Director of the TCU Center for Remote Sensing and Energy Research for energy resource mapping. Ken has lectured extensively throughout the U.S., Europe, Asia and the Middle East about resource mapping, energy technology, and emerging natural gas markets. In 2008, he founded and became Director of the TCU Energy Institute and established an Advisory Board of 24 energy companies. He was Director of TCU¹s new School of Geology, Energy, & the Environment. He currently chairs the Texas Metroplex NGV Consortium of over 100 companies that are committed to developing the Texas NGV Transportation Triangle. He is a royalty owner and enjoys driving a Honda GX-NGV to help promote the use of clean burning natural gas. Ken and his wife Tamie have two sons who have attended TCU.

John F. Baum, Ph.D.

John is a Principal in the CER Energy Institute, a firm specializing in providing development programs and resources to mineral and royalty owners in the energy industry. John is a former faculty member and Associate Director in the TCU Energy Institute at Texas Christian University. He worked closely with Dr. Ken Morgan, Director of the TCU Energy Institute, to develop the Institute into an academic center of excellence in energy. In addition, he taught undergraduate and MBA courses in the management of oil and gas assets and the development of leaders in the energy industry.

John completed his Ph.D. from the University of Wisconsin – Madison and began his academic career as a member of the graduate faculty at Purdue University in West Lafayette, Indiana. John was also on the faculty of the business school at the University of Texas at Austin. After leaving academics, John spent twenty years as a senior executive at Texas Instruments in Dallas, TX. He was the Chief Learning Officer for the corporation and directed the Leadership Development Center.

John is the architect of the TCU Energy Institute Royalty Owner Programs. Along with his colleague John Tracy, he designed the programs and oversees the delivery of the programs in multiple locations. He works closely with the instructors to make sure that the programs are designed and delivered at a world class level. He frequently serves as a facilitator of the programs and teaches certain segments.

John and his wife Sallie live in the Fort Worth area. They have four grown children and four grandchildren who keep them busy. John owns three ranches in Texas that support cow calf operations and provide a change of pace from city life. He is blessed to be a mineral owner with royalty income on two of his ranches.