Third Party Disbursements

The Accounting Manager allows you to disburse income and expenses to owners that you receive on a third party statement. For example: Your production company has a share in a program of wells from another producer. You then need to disburse that income to other owners. You can do this by using one of the two following methods.

1. Enter the net amounts from the statement you receive with your income. In this case the owner's percentages have been divided up from the percentage your company has in the wells from the other producer. For instance, you have a 20 percent share in the wells. When you disburse them to your owners, you divide your percentage into amounts relative to the contracts you have with the owners. No owner's percentage can be greater than 20 percent. The sum of all the owners cannot be greater than 20 percent. You then have to add a couple of "dummy" owners to the owner file. One Dummy owner would represent the "other" working interests and the other Dummy owner would represent the "other" royalty interests in the well. The other royalty interests should equal the total royalty interest for the particular well. The other working interest's share of the well should be the remainder of 100 percent - your interest. In this case it would be 80 percent. This method would require you to mark the particular wells as third party wells on the Well Information window. These wells would then be denoted on your production reports as being third party. Any owner that has the word "dummy" in the name will not have checks or statements generated.

2. Enter the net amounts from the statement you receive with your income. In this case the owner's percentages are a function of your original percentage as though it were 100 percent. For instance, your share of the wells is 20 percent. You then divide this share between five other owners. Owner A should have 25 percent, owner B, 25 percent, owner C, 30 percent and owners D and E, 10 percent each. Using this method will not provide the gross production information for the well.