RE:RE:RE:RE:RE:Royalties and Expect loss If i understand it correctly you would take 21% of the gross amount of helium extracted. Let's say they pull 1000MCF helium annually. They would be requred to pay the equivelant of 210MCF @ the 275$ crude price.
Basic example
ARIZONA NETS 1000MCF x 21% = 210MC 210 MCF x 275$ = $57,750
DME NETS 1000MCF x 1200MCF = $1,200,000
Arizona essentially is getting 4.8% of DME's gross profit for taxes and royalties if we're using the 275$ gross helium model and 1200MCF Processed helium model.
What i'm unclear on is they're taking 12.5% gross recoverable gas on each gas individually or as a whole (there are other less valuable gasses present). If it's as a whole the state stands to gain even less. For now i'm going to assume they take 12.5% of each because it's "worst case" and i'd rather be pleasantly surprised when someone more knowledgable can advise.
ARIZONA BLM WEBSITE STATES
- If a discovery (oil, natural gas, helium, CO2) is made, the lessee will pay a royalty to the Land Department of 12.5% of the gross value of the production.