Decimal interest calculator
Work out each owner's working interest (WI) and net revenue interest (NRI) for a single lease or a pooled unit with several tracts, check that the decimals total 1.00000000, and split a month's revenue and costs.
How decimals work
- Working interest (WI)
- An owner's share of the costs of drilling and operating, stated on an 8/8ths (100%) basis. The JIB bills costs by WI.
- Net revenue interest (NRI)
- An owner's share of production revenue after royalties and overriding royalties are taken out.
- Royalty (RI)
- The mineral owner's cost-free share of production, kept in the lease. Common rates are 1/8, 3/16, 1/5 and 1/4.
- Overriding royalty (ORRI)
- A cost-free share carved out of the working interest. It burdens either the whole lease or one owner's share.
- Tract participation factor
- A tract's share of a pooled unit, usually its acres divided by the unit's total acres.
- Revenue decimal
- Every owner's share of revenue. All revenue decimals (NRIs, royalties and ORRIs) must total exactly 1.
Tract factor
Tract acres ÷ Unit acres
320 acres in a 640-acre unit gives a factor of 0.50.
Unit WI
Tract WI × Tract factor
Added up across every tract the owner holds an interest in.
Unit NRI
Tract WI × Tract factor × (1 − Royalty − Tract ORRI − Owner's ORRI)
Burdens come out of the working interest before revenue reaches the owner.
Calculator
The calculator starts with a two-tract example unit. Replace it with your own figures. For a single lease, use one tract.
You can type rates as decimals (0.1875), fractions (3/16) or percentages (18.75%).
1Tracts
Royalty and tract ORRI are stated on an 8/8ths basis and burden every working interest owner in the tract.
| Tract name | Net acres | Royalty | Tract ORRI | Tract factor | Tract NRI to WI |
|---|
2Working interest owners
Add one row per owner per tract. The WIs in each tract must total 1. Use "Owner's ORRI" for an override that burdens only that owner's share, stated on an 8/8ths basis.
| Owner | Tract | Tract WI | Owner's ORRI | Unit WI | Unit NRI |
|---|
3Decimal interests
| Owner | Interest type | Unit WI (costs) | Revenue decimal |
|---|
4Split a month's revenue and costs
Enter gross (8/8ths) amounts. Costs are billed by WI. Revenue is paid by revenue decimal. Royalty and ORRI owners bear no costs. Taxes and deductions aren't included.
| Owner | Interest type | Revenue share | Cost share | Net |
|---|
Things to know
- Eight decimal places is the common convention for division of interest. Because of rounding, the rounded decimals may not total exactly 1. Operators usually assign the small difference to one designated interest, often their own.
- This assumes each tract is fully leased and each lessor owns all the minerals under it. If a lessor owns part of the minerals, multiply the royalty by that share. Unleased mineral owners are treated differently depending on state law and any pooling order.
- Payout and non-consent change decimals. Before payout (BPO) and after payout (APO) interests, reversionary interests and non-consent penalties aren't modeled here.
- The title opinion governs. Official decimals come from title examination and division orders. Use this tool to understand and check decimals, not as the record of ownership.
General educational information. Not legal, accounting or tax advice. Verify all ownership against title opinions, division orders and the governing agreements.