Late Payment Interest

Royalty proceeds from the sale of gas production from an oil or gas well remitted to the operator, pursuant to 52 O.S. §570.4, subsection B, states that all royalty proceeds are to be paid to persons legally entitled thereto:

a. commencing not later than six months after the date of first sale, and

b. thereafter not later than the last day of the third succeeding month after the end of the month within which such production is sold; provided, however, when proceeds are received by the operator in its capacity as a producing owner, the operator may pay the royalty share of such proceeds to the royalty interest owners legally entitled thereto at the same time that it pays the royalty proceeds received from other producing owners for the same production month, but not later than the last day of the third succeeding month after the end of the month within which such production was sold.

Important Notice Regarding 60 Day Grace Period for Payment of Oil Royalty 

Beginning January 1, 2018, a sixty-day grace period will apply to oil royalty proceeds, in accordance with 52 O.S. § 570.10. With respect to gas royalty only, the ninety-day grace period will continue to apply.

As a reminder, if payment is not received within the grace periods set forth in section 570.10, interest will begin to accrue from the date payment first became due.

Timely payment of all royalty proceeds is greatly appreciated. Please contact CLORoyaltyCheckTeam@clo.ok.gov at the Land Office for assistance concerning payment of royalties.

For convenience, portions of 52 O.S. § 570.10, “Payment of proceeds from sale of oil and gas production,” are shown below:

* * *

1. Except as otherwise provided in this section:
2. Proceeds from the sale of oil or gas production from an oil or gas well shall be paid to persons legally entitled thereto:
3. commencing not later than six (6) months after the date of first sale, and
4. thereafter not later than the last day of the second succeeding month after the end of the month within which such production is sold.
5. Notwithstanding paragraph 1 above, royalty proceeds from the sale of gas production from an oil or gas well remitted to the operator pursuant to subsection B of Section 570.4 of this title shall be paid to persons legally entitled thereto:
6. commencing not later than six (6) months after the date of first sale, and
7. thereafter not later than the last day of the third succeeding month after the end of the month within which such production is sold; provided, however, when proceeds are received by the operator in its capacity as a producing owner, the operator may pay the royalty share of such proceeds to the royalty interest owners legally entitled thereto at the same time that it pays the royalty proceeds received from other producing owners for the same production month, but not later than the last day of the third succeeding month after the end of the month within which such production was sold.