Ann: First Royalty Acres Well Set to Spud, page-4

great to see another well underway although success at this well even at similar productivity to nearby wells will be negligible to BRK . If the BRK acreage has a 5% royalty ( a guess) then their interest in the well due to a 38 acre participation in a 1620 acre unit will be 0.05 x 38/1620 x 100%= 0.11%.... so a 1000 BOPD well will give then net production of 1.1 BOPD. There will no costs associated here but bear in mind Black Mesa will back in 18.75 % of the royalty after the well pays out.

I suspect the royalty interest is lower than 5%....having said that they have over 100 acres across 4 sections in the royalty play so conceivably they could be involved in 30-40 wells at no cost to them.

Cheers

Dan