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Unconventional production · 3 min read

One lateral. Several tracts. A defensible allocation.

Make the records behind a multi-tract split visible before downstream interest calculations begin.

ONE WELL · MULTIPLE TRACTS

Separate the cascade

A commingled pad needs allocation from facility totals to wells. A multi-tract lateral then needs its well volume split on an approved basis. Participating interests are applied under the relevant agreements.

Separate steps reveal whether a disputed result came from a well estimate, a tract weight or an interest record. A single spreadsheet percentage can hide the distinction.

Put evidence behind each weight

Perforated length, stages, clusters or agreed acreage may appear in an allocation design, but the applicable basis must be established for the operation. A survey supports a configured weight; it does not replace the agreement authorizing the method.

Our reference scenario uses a two-tract split of Well A’s allocated volume. Changing the weight changes tract quantities while preserving their total. This illustrates closure and sensitivity, not the correct royalty treatment for a real property.

Version the decision

When an approved source changes, retain the previous weights, effective period and review decision. Reproduce the earlier result and inspect a revised scenario before authorizing an adjustment.

For HCF360, demonstrate the full cascade: custody total, well estimate, well allocation, tract split and participating interest. Buyers should be able to inspect each boundary and identify its supporting records.

The value to establish

Repeatable reviews when surveys, completion records or approved allocation weights change.

Editorial guide · Hydrocarbon Flow 360. Numerical examples are synthetic. Methods, agreements and operating constraints must be reviewed for the actual facility.