1. Revenue Processing

2. Paul Rivera Revenue Processing Manager
(505)
Roddy-James Martinez Revenue Processing Analyst
(505)
Dilia Borunda Revenue Processing Analyst
(505)
Mallory Miera Revenue Processing Analyst
(505)
Billie Luther Royalty PUN/Lease, Suspense
(505)

3. Revenue Processing Process royalty returns that are submitted.
Correct certain errors and/or omissions on royalty returns.
Mail notices that generate from royalty returns.
Assist remitters regarding royalty reporting issues.

4. Key Facts and Figures
Oil and Gas Royalty Revenue FY 2019 totaled $869,348,267.
3,510 Royalty returns containing about 506,512 detail line entries were processed during FY 2019.

5. Terms and Definitions OGRID – Oil and Gas Reporting Identifier
PUN – Production Unit Number
Unique identifier for one or more well completions that are assigned based on master operator, property name, pool, and/or unitization or communitization agreements.

9. Royalty Reporting Requirements
Royalty returns should be mailed, delivered, or electronically transmitted on or before the 25th day of the second month after the production month/sales period.
For most remitters, check payments must be postmarked, or EFT payments must be transmitted, on or before the 25th day of the second month after the production month/sales period.

10. Royalty Reporting Requirements
Small Royalty Remitters are those whose average monthly payments, from April 1 to March 31, are less than $25,000.
Large Royalty Remitters are those whose average monthly payments, from April 1 to March 31, are greater than or equal to $25,000.

11. Royalty Reporting Requirements
Large Royalty Remitters must submit payment by the 20th day of the month following the production month/sales period.
Large Royalty Remitters may accomplish this requirement through one of the following options:
Accelerated Royalty Payment – An amount equal to the state royalty due for the reporting period is submitted by the 20th day of the month following the production month/sales period. The associated detail royalty return should be submitted by the 25th day of the second month following production/sales period.

12. Royalty Reporting Requirements
Advance Royalty Payment – An amount that will remain on deposit with the NMSLO. The payment is then due on or before the 25th day of the second month following the production month/sales period.

13. Advance Payment
In order to meet the payment requirements for royalty, a royalty filer may submit an advance payment amount that will remain on deposit with the New Mexico State Land Office.
The deposit amount must be equal to the remitter’s average monthly royalty payment based on the twelve monthly payments submitted April 1st through March 31st.
For example, if a remitter’s monthly payment average for the previous twelve months through March 31st is $30,000, the Advance Payment deposit would be $30,000.

14. Advance Payment
The Advance Payment deposit is recalculated annually and an Advance Payment Notice is sent out beginning June 1st of each year.
The notice will include the increase or decrease required based on the remitter payment history for the calculation period.
If the amount of the remitter’s Advance Payment on deposit is more than the amount required for the current year, the remitter can apply the excess advance payment to future royalty due.
If the amount of the remitter’s Advance Payment on deposit is less than the amount required for the current year, the remitter must submit the difference to the New Mexico State Land Office on the royalty return due July 25th.

15. Advance Payment

16. Overview of Key Forms
A complete royalty return consists of the following:
OGR-1 - Oil & Gas Royalty Remittance Report
OGR-2 - Oil & Gas Royalty Detail Report
Remittance Document (for check payments only)

17. Oil & Gas Royalty Remittance Report
OGR-1
Oil & Gas Royalty Remittance Report
Used to summarize the detail submitted on the OGR-2 form(s).
Used to report credits being taken, assessments being paid, and the advance payment amount or accelerated payment.

21. Oil and Gas Royalty Detail Report
OGR-2
Oil and Gas Royalty Detail Report
Used to report line item detail for each transaction being reported.

25. OGR-2
PLEASE NOTE:
If you are filing a hardcopy (paper) return, a separate OGR-2 form is required for each sales period being reported.
Do not use commas or dollar signs. Using these in electronic filing will result in return rejecting.
All values must be presented in whole numbers. The current ONGARD system for royalty does not accept decimals.
Distinguish between numeric 0 and 1 and alphabetic O, I, and L when entering lease numbers.

26. Electronic Filing
A sender ID and password is required to access the royalty online filing application. To obtain a sender ID, contact:
Kim Gabaldon
Deputy Director
(505) Or
Paul Rivera
Royalty Processing Manager
(505)

27. Electronic Filing
To access the New Mexico State Land Office Royalty Electronic Filing:
Go to web.slo.state.nm.us
Put cursor in the menu bar over “State Land Office” and select “Royalty Online Filing”
Click “Logon to the Updated ONGARD Online Filing”
Enter your Sender ID and Password
Click on the OGRID for the report you are filing

32. Electronic Filing
There are two methods to file royalty returns electronically. These two methods are:
Royalty Online Web Filing – this application is for use by royalty remitters who report less than 40 detail lines per report.
Royalty CSV Filing – this method requires the remitter to prepare and upload a CSV file containing their royalty return information.

33. Electronic Filing

34. Royalty Online Web Filing
This method of electronic filing involves entering the royalty data directly into electronic forms that are similar to the paper royalty returns.

35. Royalty Online Web Filing
Current Month – This tab is for detail lines for the sales period you selected when starting the return. You will enter all fields except royalty, this will be calculated for you based on the pun and lease you are reporting. (OGR-2)
Amended Lines – This tab is where detail lines for prior periods will be entered. You will need to calculate the royalty amount due for this tab. (OGR-2)
Notices – This tab is for assessment notices you are paying or credit notices you are taking. (OGR-1)
Advance Payment Methods – This tab is for the advance royalty payment. (OGR-1)
Summary – This tab summarizes the information entered and totals the amount due. (OGR-1)
Detailed instructions for Royalty Online Web Filing are contained in the Royalty Filer’s kit.

36. Royalty CSV Filing
A CSV (Comma Separated Value) file is a spreadsheet or database document that is saved in the CSV format. Remitters to the New Mexico State Land Office most often use Microsoft Excel to create their CSV file, but any program that will save a file in the CSV format is accepted.
Prior to your first CSV file submission, you will work with Kim Gabaldon or Paul Rivera to get set up for CSV filing and to submit a test file to ensure that your formatting is correct.
A CSV file is uploaded to the New Mexico State Land Office. If the file is not in the correct format, the file will be rejected and you will receive an error report that details why the return was not accepted.
The New Mexico State Land Office is always willing to answer questions and assist in the preparation or correction of a CSV return.
A CSV File consists of record types and data that correspond to the royalty forms filed with the NM State Land Office.

37. Royalty CSV Filing
Record Type 5 – This record type corresponds to the OGR-1 Royalty Summary Report. It MUST be the first line in your CSV file.
Record Type 4 – This record type is used to report assessments to be paid and credits to be applied. It should only be in your CSV file if you are reporting royalty notices.
Record Type 6 – This record type is used to report royalty detail lines. This record type corresponds to the OGR-2 Oil & Gas Detail Report.
Detailed layouts for the CSV file record types are
contained in the Royalty Filer’s Kit.

38. Royalty CSV Filing

39. Royalty CSV Filing
After uploading the CSV file, you will receive an Acknowledgement of Acceptance or an Error Report listing why your return was not accepted.

40. Royalty CSV Filing
The Error Report will detail the line on which the error occurred so that corrections can be made and the file uploaded again.

41. Web Applications
The New Mexico State Land Office has several web applications that are designed to assist the royalty remitter. One is on a public website and the others are on the online filing application.
These additional applications are:
Pun/Lease Inquiry
Royalty Suspense Clearance
Royalty Detail History Inquiry
Royalty Payment History Inquiry
Royalty Outstanding Billing Statement
Royalty Remittance Document Request
Royalty Status and History

42. PUN/Lease Inquiry Screens
This application allows the user to search and view PUN, Lease, Well Completion, Allocation Percentages and Beneficiary information.
This application DOES NOT require the user to have an electronic filing user ID and password.

43. PUN/Lease Inquiry To access the application:
Go to
Put cursor in the menu bar over “State Land Office” and select “SLO Reports”
Click on “ROYALTY MANAGEMENT DIVISION”
Click on “ROYALTY INDUSTRY ACCESS”
Click on “PRODUCTION UNIT NUMBER INQUIRY” to get to the menu

45. PUN/Lease Inquiry PUN Details Information:
Search by PUN: Enter a seven-digit PUN and the screen will display PUN data including PUN type, OGRID name (Operator of the PUN), Property Name, Effective Date, and PUN Status (Active or De-active).

46. PUN/Lease Inquiry

47. PUN/Lease Inquiry PUN Details Information:
Search by OGRID: Enter the OGRID number and select the Active or De-active Option and the screen will display all PUN’s associated with the OGRID.

48. PUN/Lease Inquiry

49. PUN/Lease Inquiry
PUN Lease Information:

50. PUN/Lease Inquiry Search by PUN INQUIRY:
Enter the seven digit PUN and check either the Active or De-Active box. The screen will display the Property Name, leases attached to the PUN and the royalty rate.

51. PUN/Lease Inquiry Search by LEASE CODE:
Enter the Lease Code and the screen will display all PUNs associated with the selected Lease code.

52. PUN/Lease Inquiry
PUN Well Completion Information

53. PUN/Lease Inquiry PUN Well Completion Information
Search by PUN: Enter the seven digit PUN and the screen will display information for all well completions attached to the PUN including the API Number, Pool Identification Number, dates for which the well completion was attached to the PUN and the well completion well numbers.

54. PUN/Lease Inquiry

55. PUN/Lease Inquiry

56. PUN/Lease Inquiry PUN Well Completion Information
Search by API: Enter the API County Code, API Well IDN and Pool IDN. The screen will display the PUN the well completion is attached to, Pool name, effective dates, well numbers and Property Name. In addition, if you just search by county code, the screen will display all well completions with that county.

57. PUN/Lease Inquiry

58. PUN/Lease Inquiry

60. PUN/Lease Inquiry Allocation Percentages and Beneficiary Information
This option allows the user to view allocation percentages and beneficiary information for selected PUN.
Lease %: Displays for a selected PUN, the lease numbers, assignment numbers, number of acres, allocation percentages and total state net interest.
Lessee of Record %: Displays the Lessee of record name and their association allocation percentages.
Lessee of Record: Displays active lease number(s), the assignment number(s) and the Lessee of record name.
Lease/Bene: Displays active lease number(s) and the beneficiary associated with each active lease number.

61. PUN/Lease Inquiry Allocation Percentages and Beneficiary Information
Lease %: Displays for a selected PUN, the lease numbers, assignment numbers, number of acres, allocation percentages and total state net interest.

62. PUN/Lease Inquiry Allocation Percentages and Beneficiary Information
Lessee of Record %: Displays the Lessee of record name and their association allocation percentages.

63. PUN/Lease Inquiry Allocation Percentages and Beneficiary Information
Lessee of Record: Displays active lease number(s), the assignment number(s) and the Lessee of record name.

64. PUN/Lease Inquiry Allocation Percentages and Beneficiary Information
Lease/Bene: Displays active lease number(s) and the beneficiary associated with each active lease number.

65. Royalty Suspense Program
Objectives:
Ensure that lines which “suspend” due to error are corrected so that royalty funds can be distributed to the proper beneficiary in a timely manner.
Assist remitters in clearing suspended detail lines by providing information and researching properties if requested.

66. Royalty Suspense Program
Title Slide
Most common errors that result in suspended lines are:
Pun/Lease errors – Detail line is reported to a pun/lease or combination that does not exist or was not valid for the sales period
Invalid product code reported
Invalid transaction code reported

67. Royalty Suspense Program
Title Slide
Remitters who have detail lines in suspense are ed a spreadsheet listing all lines in suspense.
Staff assists remitter to correct these detail lines by:
Researching PUN and/or Lease based on property information given by the remitter.
Providing information and instruction on filing amended returns to correct errors which will clear the line from suspense.

68. Royalty Suspense Program
Title Slide
Methods to clear suspended detail lines:
Remitter may file an amended return backing out the line as originally submitted and entering the corrected line. This method MUST be used for suspended detail lines that also have computation, product code or transaction code errors.
Remitter may use the New Mexico State Land Office online filing application for clearing suspense.

69. Web Suspense
The NM State Land Office has a web application to clear suspended royalty detail lines. You must have a User ID and password to access this application.
This application can ONLY be used on detail lines in suspense that have a pun/lease error and NO other error.

70. Web Suspense Click “Select OGRID” from the left-hand menu.
Once you have logged into the Unified Online Filing site:
Click “Select OGRID” from the left-hand menu.
Select the appropriate OGRID from the dropdown list
Select “Royalty Suspense” option from the list of activities.
Click on “Go” and the “Welcome” screen will be displayed
Select “Suspense Lines” from the left side of the Welcome screen. The list of suspended detail lines for your account will be displayed.

71. Web Suspense

72. Web Suspense
The items in red are the detail lines that are in suspense. The user can click on the item in red and be directed to a screen where corrections can be made. This screen also displays the error that caused the line to be suspended.
Once corrected information has been entered, the user should click “Save” and the line will be removed from the suspense display.

73. Web Suspense

74. Royalty Detail History
This application allows the royalty filer to search royalty detail they have reported to the New Mexico State Land Office. Royalty Detail History is provided beginning with sales period January If you need Royalty Detail History prior to January 2002, please contact either Paul Rivera or Kim Gabaldon and we will work to provide the information.
This application DOES require the royalty filer have a user ID and password for electronic filing.

75. Royalty Detail History
The steps to retrieve your company’s detail history are as follows:
Log into the Online Filing application
Click “Select OGRID”
Select the appropriate OGRID from the dropdown list
Select “Royalty Reported Detail History” option from the list of activities
Click on the “Go” button, you will be directed to the welcome screen
Select “Detail History” from the left side of the welcome screen

76. Royalty Detail History
The following screen will be displayed:
The royalty filer can choose any, all or none of the search parameters given. If the royalty filer does not choose one of the options, all royalty detail since January 2002 will be displayed.

77. Royalty Detail History
An example of the output is pictured below. In addition, the results of any search for Royalty Detail History can me exported into excel. This search is OGRID for sales periods 1/2013 to 3/2003.

78. Royalty Payment History
This application allows the royalty filer to search history for payments made to the New Mexico Land Office for royalty.
This application DOES require the royalty filer have a user ID and password for electronic filing.

79. Royalty Payment History
The steps to retrieve your company’s payment history are as follows:
Log into the Online Filing application
Click “Select OGRID”
Select the appropriate OGRID from the dropdown list
Select “Royalty Payment History” option from the list of activities
Click on the “Go” button, you will be directed to the welcome screen
Select “Payment History” from the left side of the welcome screen

80. Royalty Payment History
The following screen will be displayed:
The royalty filer can choose to search for a particular date range or leave the search options blank and all of the payments since January 2002 will be displayed.

81. Royalty Payment History
An example of the output is pictured below. In addition, the results of any search for Royalty Payment History can be exported into excel. This search is: OGRID for sales 1/2012 to 3/2012.

82. Royalty Outstanding Billing
Statement
This application allows the royalty filer to search for outstanding notices for their company that have been issued by the New Mexico State Land Office.
This application DOES require the royalty filer have a user ID and password for electronic filing.

83. Royalty Outstanding Billing
Statement
The steps to retrieve your company’s outstanding notice information are as follows:
Log into the Online Filing application
Click “Select OGRID”
Select the appropriate OGRID from the dropdown list
Select “Royalty Outstanding Billing Statement” option from the list of activities
Click “Go” button, you will be directed to the welcome screen
Select “Outstanding Billing” from the left side of the welcome screen.
The list of notices for your account and outstanding balances will be displayed in summary form. For details on the individual notices, you can click on the “detail” button that is next to each notice balance.

84. Royalty Outstanding Billing Statement
An example of the display at the summary level is pictured below:

85. Remittance Document
The Remittance Document must accompany any royalty check payment made.
Remittance Documents may be requested online by an electronic filer or by contacting Roddy- James Martinez at (505) or

87. Remittance Document To request online: web.slo.state.nm.us
State Land Office tab
Royalty Online Filing
Logon to the Updated ONGARD Online Filing (click here)
Online Filing Login (Enter your Sender ID and Password)
Enter your OGRID
Highlight Royalty Remittance Document Request
Click Go
OPTION 1 to download-Click the Download button to the right of the OGRID.
OPTION 2 to request and have us mail-Select your OGRID and click the Request Remit Documents button

88. Remittance Document

89. Royalty Status and History
The steps to retrieve your company’s returns status and history are as follows:
Log into the Online Filing application
Click “Select OGRID”
Select the appropriate OGRID from the dropdown list
Select “Royalty Status and History” option from the list of activities
Click on the “Go” button, you will be directed to the Transaction History parameter screen.
Select your parameters and click “Go”.

91. Account Notices
The New Mexico State Land Office generates and issues oil and gas royalty account notices monthly.
Notices are categorized into assessments, credits, rejected lines, and suspended detail lines.

92. Assessments
The three most common assessments issued by the NM State Land Office:
Remittance Assessment
Interest Assessment
Computational Assessment

93. Remittance Assessment
This type of notice is issued when the remitter underpays the royalty as reported on their submitted return.
Example:
OGR-1 royalty due totals $724
OGR-2 royalty due totals $724
Payment received totals $712.
Remittance Assessment issued for $12.

94. Remittance Assessment
Remittance errors occur due to one or more of the following:
Payment is less than the royalty due.
Credit notice being taken is no longer outstanding or is outstanding for a lesser amount.
Credit detail lines have rejected.

100. Interest Assessment
This type of notice is issued when the remitter pays royalty late to the New Mexico State Land Office.
Interest is calculated at the rate of 15% per year, or 1.25% per month or fraction thereof, beginning when payment is due until payment is made.

101. Interest Assessment Example: Sales Month – June, 2019
Due by – August 25, 2019
Paid on September 30, 2019
Royalty amount = $7,469
Interest due:
($7,469 x 1.25% x 2 months)
Interest Assessment issued for $187

105. Computational Assessment
This type of notice is issued for underpayment of royalty due to a difference between the royalty reported by the remitter on the OGR-2 report and the royalty calculated by the ONGARD system based on the lease royalty rate, proceeds, and deductions presented.

106. Computational Assessment
Computational errors occur due to one or more of the following:
Gross Proceeds are incorrect
Deductions are incorrect.
Transaction Code is incorrect.
Lease royalty rate used is incorrect.
Mathematical error

107. Computational Assessment
Example:
PUN =
Lease = V01428
Lease rate =
Gross Proceeds = $1,725
Deductions = $0
Royalty reported/paid on report = $216 (.125 lrr)
Royalty as calculated by ONGARD = $288
Computational Assessment issued for $72

110. Computational Assessment
A Computational Assessment must be cleared/paid through an amendment.
Reverse the line EXACTLY as originally reported and report the line correctly.
This keeps the detail history records correct on both sides for any future amendments and for audit purposes.

111. Credits
There are three types of credits issued by the New Mexico State Land Office:
Remittance Credit
Computational Credit
Lease Credit

112. Remittance Credit
This type of notice is issued when the remitter overpays the royalty as reported on their submitted report. Remittance credits may be applied to any future royalties due or a request for refund may be made.
Example:
OGR-1 royalty due totals $14,612
OGR-2 royalty due totals $14,612
Payment received totals $14,623
Remittance Credit issued for $11.

115. Computational Credit
This type of notice is issued when an overpayment in royalty exists due to a difference between the royalty reported by the remitter on the OGR-2 report and the royalty calculated by the ONGARD system based on the lease rate, proceeds and deductions presented.

116. Computational Credit
Computational errors occur due to one or more of the following:
Gross Proceeds are incorrect
Deductions are incorrect.
Lease royalty rate used is incorrect.
Mathematical error

117. Computational Credit Computational Credit issued for $11 Example:
PUN =
Lease = E00704
Lease rate = .125
Gross Proceeds = $13,892
Deductions = $4,016
Royalty reported on report = $1,246
Royalty calculated by ONGARD = $1,235
Computational Credit issued for $11

120. Lease Credit
This type of notice is issued when a remitter has overpaid royalty in a previous month and that royalty has already been distributed to the beneficiary.
Lease credit is only issued if the net value of the return is a credit.
Lease credit may be taken against future royalty liability based on beneficiary.

121. Lease Credit
Example:
Remitter submits royalty in June, 2019 as follows:
PUN , Lease L01234, Royalty Amt. $5885
In September, 2019 the remitter discovers that royalty was overpaid for this property and lease.
Credit entry is made as follows:
PUN , Lease L01234, Royalty Amt. -$5885
PUN , Lease L01234, Royalty Amt. $3000
Lease credit issued for $2885

123. Errors in Reporting
The New Mexico State Land Office classifies errors made in reporting into three categories:
Critical Errors
Non-Critical Errors
Reject Errors

124. Critical Errors
Critical errors are those flagged by the ONGARD system to indicate that the data submitted contains errors that will generate assessment or credit notices, will cause detail lines and the associated revenue allocation to suspend, or will cause detail lines to reject.

125. Critical Errors Three most common critical errors:
Computational Error.
PUN/Lease Combination does not exist.
PUN/Lease Combination not valid for the sales period.

126. Non-Critical Errors
Non-Critical Errors are those flagged by the ONGARD system to indicate that reported data contains errors or discrepancies that are inconsistent with reporting parameters.
These errors do not generate notices, but may generate an account review or audit.

127. Non-Critical Errors The most common Non-Critical Errors:
NGL, MCF or BBL volumes not reported as required.
-This error occurs most often when the remitter does not report volumes in the BBL/MCF column. In addition, this error will occur if the remitter does not report NGL gallons when reporting product code 7-Natural Gas Liquids.
Credits claimed are > credits available in database.
-This error occurs when the remitter submits credit line entries greater than debit line entries previously submitted for the same sales period, pun and lease.

128. Reject Errors - PUN/Lease Error (Credit Line).
Reject Errors are those flagged by the ONGARD system to indicate that reported data contains errors that will cause the detail line to reject.
The most common reject errors are:
- PUN/Lease Error (Credit Line).
- Net credit requested beyond 6-year statute of limitations period.

129. Refunds There are two types of refund requests:
Distributed Funds refund
Undistributed Funds refund
All refund requests must be made on New Mexico State Land Office forms. The forms can be found at:

130. Distributed Funds Refund
This type of refund is for funds that have been previously paid and distributed to the beneficiary.
Each Distributed Funds Refund should be backed by a lease credit or the remitter must include an amended return to correct the previously submitted detail lines that are the reason for the refund request.
The PUN and lease number for which payment was made in error and the reasons for the error must be provided as part of the refund request.

131. Undistributed Funds Refund
This type of refund is for funds that have not been previously distributed to the beneficiary.
The most common types of Undistributed Funds Refund are advance payment, erroneous payment and remittance credit.
The reasons for the erroneous payment must be provided as part of the refund request.

132. Refund
Each refund request will be evaluated and a recommendation will be made to the Commissioner of Public Lands regarding approval or disapproval. As part of this evaluation, we will look at outstanding assessments that the requesting company may have and require that these assessments be paid or cleared prior to granting the refund request and issuing payment.
Only the Commissioner can approve or deny a refund request.

133. Contact Us
As a part of our efforts to make improvements, if there are suggestions you would like to make regarding the filing process or applications that you feel would be beneficial, please do not hesitate to contact any member of our staff. We look forward to hearing from you!

134. New Mexico State Land Office
Thank you!