Okla. Stat. tit. 52, § 52-570.10

production.

A. All proceeds from the sale of production shall be regarded

as separate and distinct from all other funds of any person

receiving or holding the same until such time as such proceeds are

paid to the owners legally entitled thereto. Any person holding

revenue or proceeds from the sale of production shall hold such

revenue or proceeds for the benefit of the owners legally entitled

thereto. Nothing in this subsection shall create an express trust.

B. Except as otherwise provided in this section:

1. Proceeds from the sale of oil or gas production from an oil

or gas well shall be paid to persons legally entitled thereto:

a. commencing not later than six (6) months after the

date of first sale, and

b. thereafter not later than the last day of the second

succeeding month after the end of the month within

which such production is sold.

2. Notwithstanding paragraph 1 of this subsection, 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:

a. commencing not later than six (6) 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.

3. a. Proceeds from production may be remitted to the

persons entitled to such proceeds annually for the

twelve (12) months accumulation of proceeds totaling

at least Ten Dollars ($10.00) but less than One

Hundred Dollars ($100.00). Amounts less than Ten

Dollars ($10.00) may be held but shall be remitted

when production ceases or by the payor upon

relinquishment of payment responsibility.

b. Proceeds totaling less than One Hundred Dollars

($100.00) but more than Twenty-five Dollars ($25.00)

shall be remitted monthly if requested by the person

entitled to the proceeds. Amounts less than Ten

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Dollars ($10.00) shall be remitted annually if

requested by the person entitled to the proceeds.

c. Before proceeds greater than Twenty-five Dollars

($25.00) may be accumulated, payor shall provide

notice to the person owning interest as defined in

Section 570.2 of this title, entitled to such proceeds

that there is an option to be paid monthly for

proceeds greater than Twenty-five Dollars ($25.00).

Such notice to the person shall also provide

directions for requesting monthly payment, and

constitutes notice to all heirs, successors,

representatives, and assigns of the person.

4. Any delay in determining the persons legally entitled to

proceeds from production caused by unmarketable title shall not

affect payments to persons whose title is marketable, or that

portion of a person's interest which is marketable.

C. 1. A first purchaser that pays or causes to be paid

proceeds from production to the producing owner of such production

or, at the direction of the producing owner, pays or causes to be

paid royalty proceeds from production to:

a. the royalty interest owners legally entitled thereto,

or

b. the operator of the well,

shall not thereafter be liable for such proceeds so paid and shall

have thereby discharged its duty to pay those proceeds on such

production.

2. A working interest owner that pays or causes to be paid

royalty proceeds from production to:

a. the royalty interest owners legally entitled thereto,

or

b. the operator of the well,
wners legally entitled thereto,

or

b. the operator of the well,

shall not thereafter be liable for such proceeds so paid and shall

have thereby discharged its duty to pay those proceeds on such

production.

2. A working interest owner that pays or causes to be paid

royalty proceeds from production to:

a. the royalty interest owners legally entitled thereto,

or

b. the operator of the well,

shall not thereafter be liable for such proceeds so paid and shall

have thereby discharged its duty to pay those proceeds on such

production.

3. An operator that pays or causes to be paid royalty proceeds

from production, received by it as operator, to the royalty interest

owners legally entitled thereto shall not thereafter be liable for

such proceeds so paid and shall have thereby discharged its duty to

pay those proceeds on such production.

4. Where royalty proceeds are paid incorrectly as a result of

an error or omission, the party whose error or omission caused the

incorrect royalty payments shall be liable for the additional

royalty proceeds on such production and all resulting costs or

damages incurred by the party making the incorrect payment.

D. 1. Except as otherwise provided in paragraph 2 of this

subsection, where proceeds from the sale of oil or gas production or

some portion of such proceeds are not paid prior to the end of the

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applicable time periods provided in this section, that portion not

timely paid shall earn interest at the rate of twelve percent (12%)

per annum to be compounded annually, calculated from the end of the

month in which such production is sold until the day paid.

2. a. Where such proceeds are not paid because the title

thereto is not marketable, such proceeds shall earn

interest at the rate of (i) six percent (6%) per annum

to be compounded annually for time periods prior to

November 1, 2018, and (ii) the prime interest rate as

reported in the Wall Street Journal for time periods

on or after November 1, 2018, calculated from the end

of the month in which such production was sold until

such time as the title to such interest becomes

marketable or the holder has received an acceptable

affidavit of death and heirship in conformity with

Section 67 of Title 16 of the Oklahoma Statutes, or as

set forth in subparagraph b of this paragraph.

Marketability of title shall be determined in

accordance with the then current title examination

standards of the Oklahoma Bar Association.

b. Where marketability has remained uncured, or the

holder has not been provided an acceptable affidavit

of death and heirship in conformity with Section 67 of

Title 16 of the Oklahoma Statutes, for a period of one

hundred twenty (120) days from the date payment is due

under this section, any person claiming to own the

right to receive proceeds which have not been paid

because of unmarketable title may require the holder

of such proceeds, or the holder of such proceeds may

elect, to interplead the proceeds and all accrued

interest into court for a determination of the persons

legally entitled thereto. Upon payment into court the

holder of such proceeds shall be relieved of any

further liability for the proper payment of such

proceeds and interest thereon.

E. 1. Except as provided in paragraph 2 of this subsection, a

first purchaser or holder of proceeds who fails to remit proceeds

from the sale of oil or gas production to owners legally entitled

thereto within the time limitations set forth in paragraph 1 of

subsection B of this section shall be liable to such owners for

interest as provided in subsection D of this section on that portion

of the proceeds not timely paid. When two or more persons fail to

remit within such time limitations, liability for such interest

shall be shared by those persons holding the proceeds in proportion

to the time each person held such proceeds.
h in paragraph 1 of

subsection B of this section shall be liable to such owners for

interest as provided in subsection D of this section on that portion

of the proceeds not timely paid. When two or more persons fail to

remit within such time limitations, liability for such interest

shall be shared by those persons holding the proceeds in proportion

to the time each person held such proceeds.

2. When royalty proceeds on gas production are remitted

pursuant to subsection B of Section 570.4 of this title:

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a. A first purchaser that causes such proceeds to be

received by the operator or by a producing owner in

the well for distribution to the royalty interest

owner legally entitled thereto within the first month

following the month in which such production was sold

shall not be liable for interest on such proceeds.

b. A producing owner receiving royalty proceeds that

causes such proceeds to be received by the royalty

interest owner legally entitled thereto or by the

operator for distribution to the royalty interest

owner legally entitled thereto not later than the end

of the first month following the month in which

proceeds for such production was received by the

producing owner from the purchaser shall not be liable

for interest on such proceeds.

c. An operator receiving royalty proceeds that causes

such proceeds to be received by the royalty interest

owner legally entitled thereto, not later than the end

of the first month following the month in which

proceeds for such production was received by the

operator from the purchaser or producing owner, shall

not be liable for interest on such proceeds.

d. Liability for interest provided in subsection D of

this section shall be borne solely by the person, or

persons, failing to remit royalty proceeds within the

time limitations set forth in subsection B of this

section. When two or more persons fail to remit

within such time limitations, liability for such

interest shall be shared by such persons in proportion

to the time each person held such proceeds.

F. Nothing in this section shall be construed to impair or

amend existing or future contractual rights provided for in gas

balancing agreements or other written agreements which expressly

provide for the taking, sharing, marketing or balancing of gas or

the proceeds therefrom. Any proceeds to be paid pursuant to any

such agreement shall not commence to earn interest until the sooner

of the time provided in such agreement for the payment of such

proceeds or ninety (90) days from the date of the depletion of the

well. Nothing herein shall be deemed to alter or limit the payment

of royalty proceeds as provided in the Production Revenue Standards

Act.

G. All payments under the Production Revenue Standards Act to

owners or any other person or governmental entity legally entitled

to the payment may be made by electronic means including but not

limited to electronic funds transfer, Automated Clearing House

(ACH), direct deposit, wire transfer, or any other similar form of

transfer, upon the mutual written consent of the payor and payee.

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