Frequently Asked Questions
Questions about Royalty Checks
They are mailed on the 25th unless this day is a holiday or weekend; then they will be mailed on the first business day after the holiday or weekend. For example, if 7/25/XX falls on a Sunday, royalty checks will be mailed on 7/26/XX.
Please wait ten business days to give the mail ample time for delivery before contacting Iskandia. Our minimum check amount is $100.00. If due to fluctuation in volumes and/or prices, your accrued amount is less than $100.00, there will be no check issued that month. You may, however, request that funds be issued to you when your accrued amount reaches $25.00. Download the $25 Minimum Check Form (PDF) (Link: Minimum Check Form). Smaller revenue amounts that fail to meet the minimums above are accumulated month to month until they meet the minimum, at which time you will receive a check. Smaller revenue amounts that have accumulated to more than $10 per owner are paid at least once annually, in October. Other reasons for not receiving a check include that your interest may have been placed in suspense due to a bad address, transfer of interest, or title dispute.
Contact our Owner Relations at 281-661-1999 to request payment if your check has been lost or stolen. Please have the following information ready when you call:
- Your name
- Your owner number
- Your taxpayer identification number
We will verify the status of your check with our Treasury Department and stop payment if the check is outstanding. The funds will be made available again through reissue to you under a new check number. If your check is over 90 days old, it will not be honored. Please void the check and return it with a written request to reissue to:
Iskandia Attn: Land 801 Travis Street, Suite 1818 Houston, TX 77002
Many factors contribute to your payment, including: market conditions, regulatory or contractual changes, diminished production, seasonal conditions, and downtime.
This occurs because ownership between family members is not equal, because one party has not provided Iskandia with a Taxpayer Identification Number (TIN, or Social Security Number), or because some family members may own an interest in other properties in addition to those commonly owned.
Generally, state severance taxes are deducted. Further, if you do not provide us your Social Security Number, we may withhold federal income tax as required by the Internal Revenue Service. If you’re a non-resident alien, we may deduct federal income tax from your check.
The deductions are usually transportation or gathering charges.
Questions about Unpaid or Suspended Royalties
Please visit the National Association of Unclaimed Property Administrator (NAUPA) website at www.unclaimed.org to locate and collect unclaimed funds in your name.
The reasons for suspending your revenue are: title dispute, death of owner, transfer of ownership, unknown address, unexecuted division order, escheated, legal requirement, lien, missing tax ID or Social Security number.
A W-9 form (Link:W-9) is a request for taxpayer identification number and certification. It must include your name, address, federal tax classification, tax identification number, signature and date. Please note this document must have your signature to be valid. Once completed please either mail by post, email a scanned copy or fax it to us.
A duplicate can be provided should you misplace your form. Please contact owner relations at 832-209-8240 or Accounting@Iskandia.com to verify the address. Please be prepared to provide your owner number(s).
The 1099 (Link: 1099 pic) form is a series of documents the Internal Revenue Service (IRS) refers to as "information returns." The 1099 form report your income you may receive throughout the year.
Questions about other topics
A Division Order is a directive signed on behalf of the Interest Owner verifying to the purchaser or operator of a well the decimal interest of production owned by the owner. It also provides the owner’s remittance address and taxpayer identification number.
Iskandia does occasionally buy interest in our existing properties. Please contact the land department to discuss your situation.
All heirship and conveyance documents must be filed of record with the parish or county where the property is located.
Royalty Interest (RI) owners own the minerals and have signed an oil and gas lease which entitles the owner to a percentage of revenue from the sale of oil and gas produced from the acreage described in the oil and gas lease. This percentage of revenue is referred to as the “royalty interest”. This interest is not subject to any of the costs related to the development, drilling, operations or maintenance of the well.
A Working Interest (WI) is a percentage of ownership in an oil and gas lease and grants its owner the right to explore drill and produce oil and gas from a tract of property. Working Interest owners are obligated to pay their proportionate percentage of the cost of leasing, drilling, producing and operating a well or unit.
A Mineral Interest (MI) is also known as an unleased mineral interest and is a cost-bearing interest because the unleased mineral interest owners are not sharing a portion of their production in exchange for the Operators covering all of the production costs associated with extracting the resources from the ground. The unleased mineral interest owners are entitled to 100% of their production minus their proportionate share of the cost of drilling, completing and equipping the well in addition to operating costs after the well is completed.
A net proceeds interest is not an interest in actual minerals. A net proceeds interest is a fractional ownership in the revenue derived from the sale of oil and gas, less expenses. This interest type is generally created when the leasehold, or working interest, is transferred through a 247 Operating Agreement to a second party with the first party reserving a percentage of revenue from the sale of production, less expenses.
Although your check detail indicates your interest is a royalty interest (RI), as though you own leased minerals, you actually own a net proceeds interest.
An Overriding Royalty Interest (OR) is an interest which is not connected to an ownership of minerals under the ground. It is the right to receive revenue from the production of oil and gas from a well. The overriding royalty is carved out of the Lessee’s (operator’s) working interest and entitles its owner to a fraction of production. It is limited in duration to the terms of a specific existing oil and gas lease, but is not subject to any of the expenses of development, operation or maintenance. An overriding royalty interest expires once the lease has expired and production has stopped, whereas minerals and royalty owners maintain their ownership after production stops.