A lessor insists on a 'gross proceeds' royalty clause for gas. What is the advantage to the lessor compared to a 'net proceeds' clause?
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A
Gross proceeds royalties are paid faster than net proceeds royalties
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B
Gross proceeds are calculated before deducting post-production costs, yielding a higher royalty base
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C
Gross proceeds royalties are exempt from state severance taxes
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D
Net proceeds clauses apply only to oil, not gas