Ok, not that I have, but who do you contact when you strike oil? I'm writing a little story about it and I need to know. This is IMPORTANT so please be serious! I know kids may not know but adults might. I need to know so best answer gets 10!
2007-11-30 16:02:02 · 4 answers · asked by Lexi 2 in Business & Finance ➔ Investing
Um...Well in my "story" they were just digging around and happened upon it...I'm not even sure if that's realistic or not ha;
does that help any?
2007-11-30 16:17:12 · update #1
You contact the refineries to see which one has the best price on the type and grade of oil you found. There are many types and grades of oil and the price is dependent on those factors. The price of oil that you see in the news is a benchmark for all the other types and grades.
It doesnt quite work like Jed Clampett just shooting at some food and up from the ground comes a bubbling crude. Not in the US anyway. They use a drilling rig. When they're just "digging around" and there are no wells in that area, thats called a wildcat well.
Normally the mineral rights are leased from someone, an individual, the state, or the federal government, in order to drill, which requires a fairly standard contract. Mineral rights are not the rights to the land. Its the right to drill on the land and recover the oil from it. In exchange for that right the mneral rights owner gets a percentage of whats recovered (plus the payment for the right to drill), which ranges from 1/8 to 1/4. Thats called a royalty interest. The person that leased the mineral rights gets the rest, and has to pay all expenses for the well whether they find anything or not. So they take all the risk.. Thats called a working interest. if its not your property you're drilling on, chances are you already have a lawyer.
2007-11-30 16:38:11 · answer #1 · answered by jeff410 7 · 2⤊ 0⤋
You need more details dear. I work on a drilling rig and may have your answer but with so few details it is only a guess. Are you talking like digging with a shovel in your backyard? Part of a LLC? Been through all the permit and legals of the whole deal?
2007-12-01 00:13:39 · answer #2 · answered by pappyld04 4 · 1⤊ 1⤋
Well, I'd contact my lawyer, especially one I trust. They may be able to tell you step by step what needs to be done.
2007-12-01 00:30:43 · answer #3 · answered by Anonymous · 0⤊ 0⤋
kexi i do not think i could top poster three == good luck on your paper!!!
2007-12-04 17:03:10 · answer #4 · answered by mister ed 7 · 0⤊ 0⤋