This operating agreement exhibit provides that each party has the right to take in kind its share of gas produced from the Contract Area and market or otherwise dispose of its gas. In the event any party is not, at any time, taking or marketing its share of gas, or has contracted to sell its share of gas produced from the Contract Area to a purchaser which does not, at any time, take the full share of gas attributable to the interest of the party, then the terms of this agreement shall automatically become operative.
Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: A Comprehensive Overview In the realm of oil and gas contracts, the Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement, also known as Form 2, holds paramount importance. This agreement provides a framework that ensures the efficient and fair distribution of gas resources in the Hawaiian region. Let's dive into the specifics of this agreement, explore its key components, and shed light on any potential variations that might exist. Key Features of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: 1. Purpose: The primary objective of Form 2 is to maintain gas balance throughout the operational lifecycle by establishing procedures for accurate gas measurement, allocation, and settlement. It aims to achieve equitable distribution while minimizing potential disputes between parties involved in gas extraction, transportation, and utilization. 2. Gas Balancing Coordination: This agreement serves as a mechanism for coordinating gas balancing activities. It outlines the roles, responsibilities, and obligations of all participants involved in the gas supply chain, including the operators, shippers, and transporters. By clearly defining these roles, the agreement ensures transparency and accountability. 3. Measurement and Reporting: Form 2 emphasizes the importance of accurate gas measurement and reporting. It specifies the calibration standards, measurement procedures, and reporting protocols to be followed. This ensures that gas quantities are precisely measured at various stages, from production to delivery, enabling reliable allocation and settlement. 4. Gas Balancing Methodology: The agreement outlines the gas balancing methodology to be adopted. It often includes established industry practices, such as the "pro rata" method, which allocates gas quantities to participants based on their relative entitlements. Alternatively, it may employ other methodologies tailored to the specific needs and complexities of the Hawaiian regional gas market. 5. Imbalance Management: Form 2 establishes procedures for managing gas imbalances among participants. It defines what constitutes an imbalance and lays out the remedies and penalties for any deviations from the agreed-upon allocation. This ensures that participants maintain a balance between their actual gas off-take and contracted entitlements. Different Types of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: Although the core purpose remains the same, slight variations may exist within different instances of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2. These variations are typically tailored to specific gas fields, operational conditions, or contractual arrangements. Some possible types or variations may include: 1. Offshore vs. Onshore Agreements: Gas balancing requirements differ between offshore and onshore gas fields due to varying geological conditions, technological constraints, and transportation logistics. Consequently, Form 2 may vary in terms of measurement techniques, balancing procedures, and reporting requirements, depending on the location of the gas extraction activities. 2. Field-Specific Adjustments: Certain gas fields may require specific adjustments in the gas balancing agreement. For instance, if a gas field exhibits unique characteristics, such as high variability in gas composition, fluctuating production rates, or complex sales arrangements, Form 2 may be tailored to address these nuances and ensure accurate and equitable gas allocation. 3. Customized Gas Balancing Methodologies: While the "pro rata" method is commonly employed, some gas fields may adopt alternative balancing methodologies to cater to specific market dynamics or contractual arrangements. These variations could include using a "swing" supplier, managed by an independent entity, or applying a certain formula-based approach when allocating gas volumes to different parties. In conclusion, Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2 plays a critical role in ensuring efficient gas distribution in the Hawaiian region. By setting forth clear guidelines for gas measurement, reporting, and balancing, it promotes fairness, transparency, and effective management of gas resources. While there may be variations in this agreement based on the specificities of gas fields and contractual arrangements, its core objectives remain consistent across different instances.Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: A Comprehensive Overview In the realm of oil and gas contracts, the Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement, also known as Form 2, holds paramount importance. This agreement provides a framework that ensures the efficient and fair distribution of gas resources in the Hawaiian region. Let's dive into the specifics of this agreement, explore its key components, and shed light on any potential variations that might exist. Key Features of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: 1. Purpose: The primary objective of Form 2 is to maintain gas balance throughout the operational lifecycle by establishing procedures for accurate gas measurement, allocation, and settlement. It aims to achieve equitable distribution while minimizing potential disputes between parties involved in gas extraction, transportation, and utilization. 2. Gas Balancing Coordination: This agreement serves as a mechanism for coordinating gas balancing activities. It outlines the roles, responsibilities, and obligations of all participants involved in the gas supply chain, including the operators, shippers, and transporters. By clearly defining these roles, the agreement ensures transparency and accountability. 3. Measurement and Reporting: Form 2 emphasizes the importance of accurate gas measurement and reporting. It specifies the calibration standards, measurement procedures, and reporting protocols to be followed. This ensures that gas quantities are precisely measured at various stages, from production to delivery, enabling reliable allocation and settlement. 4. Gas Balancing Methodology: The agreement outlines the gas balancing methodology to be adopted. It often includes established industry practices, such as the "pro rata" method, which allocates gas quantities to participants based on their relative entitlements. Alternatively, it may employ other methodologies tailored to the specific needs and complexities of the Hawaiian regional gas market. 5. Imbalance Management: Form 2 establishes procedures for managing gas imbalances among participants. It defines what constitutes an imbalance and lays out the remedies and penalties for any deviations from the agreed-upon allocation. This ensures that participants maintain a balance between their actual gas off-take and contracted entitlements. Different Types of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2: Although the core purpose remains the same, slight variations may exist within different instances of Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2. These variations are typically tailored to specific gas fields, operational conditions, or contractual arrangements. Some possible types or variations may include: 1. Offshore vs. Onshore Agreements: Gas balancing requirements differ between offshore and onshore gas fields due to varying geological conditions, technological constraints, and transportation logistics. Consequently, Form 2 may vary in terms of measurement techniques, balancing procedures, and reporting requirements, depending on the location of the gas extraction activities. 2. Field-Specific Adjustments: Certain gas fields may require specific adjustments in the gas balancing agreement. For instance, if a gas field exhibits unique characteristics, such as high variability in gas composition, fluctuating production rates, or complex sales arrangements, Form 2 may be tailored to address these nuances and ensure accurate and equitable gas allocation. 3. Customized Gas Balancing Methodologies: While the "pro rata" method is commonly employed, some gas fields may adopt alternative balancing methodologies to cater to specific market dynamics or contractual arrangements. These variations could include using a "swing" supplier, managed by an independent entity, or applying a certain formula-based approach when allocating gas volumes to different parties. In conclusion, Hawaii Exhibit E to Operating Agreement Gas Balancing Agreement — Form 2 plays a critical role in ensuring efficient gas distribution in the Hawaiian region. By setting forth clear guidelines for gas measurement, reporting, and balancing, it promotes fairness, transparency, and effective management of gas resources. While there may be variations in this agreement based on the specificities of gas fields and contractual arrangements, its core objectives remain consistent across different instances.
