Can oil wells be shut down?

The temporary shutting in of wells is the one thing that oil companies are trying to avoid at all costs. That's because restarting production is expensive and wells are not guaranteed to return to their flow rate.

US Legal Forms
Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells

Oil Leases For Sale

Name: Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells
Brand: US Legal Forms
Price: 59.00 USD
Rating: 4.7 (348 reviews)

Category:

Oil Gas and Minerals - Amendments

State:

Multi-State

Control #:

US-OG-576

Format:

Instant download

Description

This is a form of an Amendment to an Oil and Gas Lease to Add a Shut-in Royalty Provision For Oil Wells.

View Judicial Determination - After Child is Removed from Home

View this form

View Inmate Forms for Filing of Civil Actions Against the State - Petition

View this form

View Motion for Inclusion in Child Visitation Custody

View this form

View Standard Visitation Schedule - Order

View this form

View Motion for Enforcement of Noncustodial Parent Visitation Rights

View this form

Advertising Effectiveness Study

View this form

How to fill out Amendment To Oil And Gas Lease To Add Shut-In Provision For Oil Wells?

When it comes to drafting a legal form, it’s easier to leave it to the professionals. However, that doesn't mean you yourself can’t get a template to utilize. That doesn't mean you yourself can not find a template to utilize, nevertheless. Download Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells from the US Legal Forms site. It offers numerous professionally drafted and lawyer-approved forms and samples.

For full access to 85,000 legal and tax forms, users just have to sign up and select a subscription. After you’re signed up with an account, log in, look for a certain document template, and save it to My Forms or download it to your gadget.

To make things much easier, we have included an 8-step how-to guide for finding and downloading Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells promptly:

Make sure the form meets all the necessary state requirements.
If available preview it and read the description before purchasing it.
Press Buy Now.
Select the suitable subscription to meet your needs.
Create your account.
Pay via PayPal or by credit/visa or mastercard.
Select a preferred format if several options are available (e.g., PDF or Word).
Download the document.

When the Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells is downloaded you are able to fill out, print out and sign it in almost any editor or by hand. Get professionally drafted state-relevant documents in a matter of minutes in a preferable format with US Legal Forms!

Form Rating

4.7

Satisfied(348)

Form popularity

FAQ

The temporary shutting in of wells is the one thing that oil companies are trying to avoid at all costs. That's because restarting production is expensive and wells are not guaranteed to return to their flow rate.

The ability to declare a well shut-in and simply tender a shut-in royalty in lieu of a production royalty does not occur automatically. There is no inherent right to shut-in a completed oil/gas well.

To restart production, it is necessary to bring a new rig, drill the cement plug, and pump the sludge blocking the well head.At best, resuming production may require months of work, at worst, shutdown can permanently diminish the throughput of the facility. Offshore drilling platforms have their own challenges.

To shut in a well means to make it not produce, so we'll start with a primer on production. When a well is producing it means the well has been drilled, completed in a reservoir, and oil and/or gas is somehow moving up the wellbore and to the surface facility.

Essentially, the shut-in royalty provision allows a lessee to temporarily cease production (i.e., shut-in a well) and pay a shut-in royalty to the lessor in place of the royalty on production that is not occurring during the shut-in period.

The cost of a routine abandonment of a typical well in the United States is about $5,000 (~Texas average cost in year 2000). If a well has developed a leak that allows gas to flow up the outside of the well casing, finding and correcting the leak can push the cost of abandonment beyond $100,000.

Definition: Shut-in royalty is a payment made by an oil and gas lessee to the lessor in order to keep a lease in force when a well capable of producing is not utilized. This is usually because there is no market for oil or gas or no pipeline ready to receive production.

In the petroleum industry, shutting-in is the implementation of a production cap set lower than the available output of a specific site. This may be part of an attempt to constrict the oil supply or a necessary precaution when crews are evacuated ahead of a natural disaster.

An oil well is not like a light switch you can flick on and off. A well that has been shut down can be hard to turn back on. Elizabeth Gerbel, CEO of EAG Services, an oil and gas consulting company, compares it to a bottle of soda.

Oil Leases For Sale

Description

Related forms

Viewed forms

How to fill out Amendment To Oil And Gas Lease To Add Shut-In Provision For Oil Wells?

Show more info

Form Rating

Form popularity

FAQ

Can oil wells be shut down?

Can you shut-in an oil well?

Can a shut-in well be reopened?

What happens when a well is shut in?

What is a shut in royalty payment?

How much does it cost to shut in a well?

What is a shut-in payment?

What does shut-in mean in oil and gas?

Can you turn off an oil well?

Trusted and secure by over 3 million people of the world’s leading companies