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Operating Your Well

Oil and natural gas are frequently produced as a mixture, rising to the surface due to existing or artificially induced underground pressure. In most cases, petroleum at the surface is separated into oil, natural gas and water. Natural gas is metered and taken from the lease via pipeline and sold according to the terms of the applicable contracts. Oil is stored until sale, upon which time it is transported by truck, rail or pipeline. Oil is considered “sold” when it is removed from the lease. 

Measuring Production

Oil and natural gas are measured differently. Oil is measured using a "run ticket,” which standardizes oil volumes by adjusting for temperature, gravity and a factor known as BS&W (basic sediment and water).

Signing the Lease

Signing of the lease permits the drilling and production of oil and/or natural gas on the leased property.

Clearing the Title

If petroleum can be produced in commercial quantities, operating companies must clear the title to mineral rights for oil and natural gas extracted from the property. This process may involve several parties and can take several months. For more information, see Frequently Asked Questions.

Receiving a Division Order

A Division Order is a document Marathon Oil issues that describes the property, the operator, the legal description, the owner's remittance address and tax ID information, if known, as well as the owner's decimal interest in the property. The owner is asked to sign and return the Division Order. Marathon Oil uses this information to remit proceeds to the owner if Marathon Oil has the disbursement responsibility.