To read a division order, start with three items: the property and well description, your interest type, and your decimal interest. Then check that decimal against your deed and your lease before you sign. If the numbers do not match, do not sign until the operator corrects them.
A division order is a document from the operator or purchaser that states how much of the production revenue from a well or unit belongs to you. This guide explains how to read a division order line by line. It is part of our oil and gas law resources for Pennsylvania owners. For background on the document itself, see our page on what division orders do and when they arrive.
Key takeaways
– A division order confirms ownership and payment details. It should not change your lease terms.
– Your decimal interest is a math result. You can rebuild it from your acreage, the unit size, your ownership share, and your royalty rate.
– Royalty owners and working interest owners have different decimals. Know which one you hold.
– Compare every division order with your deed, lease, and any pooling documents before signing.
– Pennsylvania requires operators to give royalty owners detailed payment statements.
What a division order contains
Forms differ from company to company, but most division orders in Washington County include the same core fields. Here is what each one means.
| Field | What it means | What to check |
|---|---|---|
| Operator or payor | The company paying you | Name matches your lease or a known successor |
| Property or unit name | The well or pooled unit producing gas | Unit matches the pooling or unit declaration you received |
| Well name and API number | Unique well ID from state records | Look it up in PA DEP well records |
| Owner number | Your account number with the payor | Use it on all correspondence |
| Interest type | RI, ORRI, or WI (see below) | Correct type for what you own |
| Decimal interest | Your share of revenue, shown as a decimal | Rebuild it yourself (see example) |
| Tax ID | Your Social Security or tax number for reporting | Required for payment; send it securely |
| Effective date | Date your payments start under this order | Should match first production or your purchase date |
| Signature and address | Your confirmation and mailing details | Read every sentence above the signature line |
Some terms need a one-line definition
- RI (royalty interest): your share of production, free of drilling and operating costs, that you keep as a lessor (the landowner who signed the lease).
- ORRI (overriding royalty interest): a royalty carved out of the lessee’s side of the lease, often held by landmen or former lessees.
- WI (working interest): the share held by the companies that pay to drill and operate the well.
How to read a division order decimal interest
The division order decimal interest is the most important number on the page. It is usually shown to six or eight decimal places. A small error can add up over many years of production.
For a royalty owner in a pooled unit, the basic formula is
Your net acres in the unit ÷ total acres in the unit × your royalty rate = decimal interest
“Net acres” means your gross acres multiplied by your share of the minerals. If you own half the oil and gas under a 20-acre tract, you own 10 net acres.
Worked example (hypothetical)
The numbers below are hypothetical and are used only to show the math. They do not reflect any real lease, unit, or royalty rate.
| Step | Hypothetical input | Result |
|---|---|---|
| 1. Tract acres in the unit | 20 acres | 20 |
| 2. Your mineral share | 50% | 20 × 0.50 = 10 net acres |
| 3. Unit size | 640 acres | 10 ÷ 640 = 0.015625 |
| 4. Royalty rate in lease | 15% | 0.015625 × 0.15 = 0.00234375 |
| Decimal interest | 0.00234375 |
If this hypothetical unit had $100,000 of gross revenue in a month, this owner’s share would be $234.38 before taxes and any deductions the lease allows. Again, that figure is only an illustration.
If your decimal differs from yours, the cause may be the unit size, acreage, title, or royalty rate. Each is worth a written question to the operator.
Net revenue interest vs royalty interest
Owners often see the term net revenue interest on division orders and statements. Net revenue interest (NRI) is the share of revenue an interest owner receives after royalty and other burdens are taken out.
For example, a company holding 100% of the working interest keeps only the revenue left after royalty and overriding royalty owners are paid. That remainder is its NRI.
For a royalty owner, many statements simply label your royalty decimal as your “NRI” or “owner interest.” The key point is this: your decimal should reflect your royalty, not a share of costs. Royalty owners do not pay drilling or operating costs. Whether certain post-production costs can be deducted depends on your lease language and Pennsylvania law. Our page on questions about royalty payments and deductions covers that topic.
Signing a division order is not a lease amendment
A division order is meant to confirm who gets paid and how much. It is not supposed to change your lease. Still, some forms include extra language. Examples include sentences about how gas will be valued, how costs will be handled, or a promise to hold the payor harmless (protect it from claims).
How Pennsylvania courts treat that kind of language in a division order is a legal question. The practical rule is simple: read every sentence, and strike or question anything that goes beyond ownership and payment details. You can sign a division order with a cover letter stating that your signature does not amend your lease.
Pre-signing checklist
- [ ] My name and mailing address are correct.
- [ ] The interest type (RI, ORRI, WI) matches what I own.
- [ ] I rebuilt the decimal and it matches.
- [ ] The royalty rate used matches my lease, including any amendments.
- [ ] The unit name matches the pooling or unit notice I received.
- [ ] The form contains no language about valuation, deductions, or lease changes.
- [ ] I have copies of my deed, lease, and any recorded memoranda.
Free download: Pennsylvania Gas Lease Review Checklist → /gas-lease-checklist/
Use it to pull the royalty rate, deduction terms, and pooling language from your lease so you can compare them with your division order.
Check the division order against your lease and title
Your lease sets your royalty rate and the rules for deductions and pooling. Your deed and the chain of title set how much of the minerals you own. The division order should match both.
Pennsylvania’s minimum royalty law, 58 P.S. § 33, requires at least a one-eighth royalty. If your decimal implies a royalty below your lease rate, ask why.
Title records for Washington County properties are kept at the Washington County Recorder of Deeds. Operators often rely on a drilling title opinion to set decimals. If that opinion missed a deed, an inheritance, or a severance (a split of mineral rights from the surface), the decimal can be wrong.
What to do if your division order is wrong
- Do not sign yet. In many cases, signing is not required to receive payment, but unsigned orders can delay payments.
- Write to the operator’s owner relations department. Give your owner number, the well or unit name, and the specific error.
- Send supporting documents. Include your deed, lease, any estate or probate papers, and your own calculation.
- Keep a log. Note dates, names, and reference numbers for every call and letter.
- Ask about suspended funds. If payments were held while title was reviewed, ask how much is in suspense and when it will be released.
- Get help if the operator does not respond. A lawyer can review the title, the lease, and the payment history.
Act 66 royalty statements
Under Act 66 of 2013, 58 P.S. § 35.1–35.2, operators must give Pennsylvania royalty owners statements with each payment. These statements show items such as the well or unit, production volume, price, taxes, your interest, and any deductions.
Compare the interest shown on each statement with your signed division order. They should be the same. If the decimal changes from month to month without explanation, ask the operator in writing.
Frequently asked questions
Do I have to sign a division order in Pennsylvania?
Pennsylvania does not have a general statute that requires you to sign one. Operators often ask for a signed order before releasing payments. Before signing, confirm that the form only covers ownership and payment details and does not change your lease.
What is a good division order decimal interest?
There is no single good number. Your decimal depends on your acreage, your mineral share, the unit size, and your royalty rate. The right decimal is the one that matches your title and lease. Rebuild the math yourself and compare it to the operator’s figure.
What is the difference between net revenue interest and royalty interest?
A royalty interest is a cost-free share of production kept by the mineral owner who leased. Net revenue interest is the share of revenue an owner keeps after royalty burdens. Working interest owners usually think in NRI; royalty owners usually see their royalty decimal on statements.
Why did my decimal interest change?
Common reasons include a change in unit size, new tracts added to the unit, a title correction, a transfer of ownership, or an estate settlement. Ask the operator for a written explanation and a revised division order showing how the new decimal was calculated.
Can a division order change my royalty rate?
A division order should not change your lease royalty rate. If the decimal reflects a lower rate than your lease, or the form contains language about valuation or deductions, do not sign without review. Ask the operator to correct the form first.
Questions about your division order?
If a division order or royalty statement does not add up, we can review it with your lease and title records. Call (304) 982-1586 or request a consultation. After you call, we will ask for the operator name and well or unit, then tell you which documents to send before we meet. Our office serves owners across Cecil Township and Washington County.
About the author: Daniel B. Kostrub is an attorney at Kostrub Law Firm, PLLC, where he focuses on energy law, oil and gas transactions, title opinions, division orders, mineral rights, and lease review. Read Dan’s bio.
This page is general information, not legal advice. Reading it does not create an attorney-client relationship.