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Current as of January 02, 2025 | Updated by Findlaw Staff
You must prevent uncompensated drainage of oil and gas from unit land by wells on land not subject to the unit agreement. Permissible means of satisfying the obligation include—
(a) Drilling a protective well if it is economically feasible. For this subpart, economically feasible means producing a sufficient quantity of oil or gas from a protective well in the unit for a reasonable profit above the cost of drilling, completing and operating the protective well;
(b) Paying compensatory royalty;
(c) Forming other agreements, or modifying existing agreements, that allow the tracts committed to the unit agreement to share in production after the effective date of the new or modified agreement; or
(d) BLM may require additional measures to prevent uncompensated drainage.
Cite this article: FindLaw.com - Code of Federal Regulations Title 43. Public Lands: Interior § 43.3137.64 As a unit operator, what must I do to prevent or compensate for drainage? - last updated January 02, 2025 | https://codes.findlaw.com/cfr/title-43-public-lands-interior/cfr-sect-43-3137-64/
FindLaw Codes may not reflect the most recent version of the law in your jurisdiction. Please verify the status of the code you are researching with the state legislature before relying on it for your legal needs.
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