This form is pursuant to The Act of February 25, 1920, as amended and supplemented, authorizes communitization or drilling agreements communitizing or pooling all or a portion of a Federal oil and gas lease, with other lands, whether or not owned by the United States, when separate tracts under the Federal lease cannot be independently developed and operated in conformity with an established well-spacing program for the field or area.
Idaho Commoditization Agreement, also known as Idaho Commoditization Order, is a legal arrangement in the state of Idaho that allows multiple oil and gas leaseholders to pool their interests together to create a single drilling unit. Commoditization Agreement enables efficient development and optimal utilization of mineral resources, particularly in cases where individual leases or tracts are too small or fragmented to be economically feasible for exploration and production activities. This agreement is authorized under the Idaho Code, specifically Title 47, Chapter 18. It provides the framework for lessees to consolidate their rights within a specified area, known as a comm unitized unit. By pooling their interests, the lessees can collectively engage in drilling and production activities within the unit, treating it as a single lease instead of separate tracts. The Idaho Commoditization Agreement process involves obtaining approval from the Idaho Oil and Gas Conservation Commission (LOGIC). The commission reviews the proposed agreements to ensure regulatory compliance, equitable sharing of production, and protection of the correlative rights of all interested parties. Once approved, the comm unitized unit is established, and operations can commence under the terms outlined in the agreement. There are different types of Idaho Commoditization Agreements, based on the specific circumstances and needs of the leaseholders. Some common types include: 1. Voluntary Commoditization Agreement: This occurs when leaseholders voluntarily agree to combine their leases within a defined area. It is commonly pursued to enhance operational efficiencies, reduce costs, and increase productivity. 2. Compulsory Commoditization Agreement: In situations where some leaseholders are unwilling to participate in a voluntary agreement, other leaseholders can request a compulsory commoditization order from the LOGIC. This allows the formation of a comm unitized unit without the consent of all leaseholders. 3. Temporary Commoditization Agreement: This agreement is established for a limited period, often used when a primary well is temporarily shut down due to maintenance or other issues. It enables other leaseholders to continue operations and prevent unnecessary and uneconomical cessation of production. 4. Unit Agreement Modification: Sometimes, existing commoditization agreements require modifications due to changes in circumstances, technological advancements, or shifts in lease ownership. Leaseholders can propose modifications to the LOGIC, which will then evaluate the request and approve or deny it based on its merits. Idaho Commoditization Agreement plays a pivotal role in promoting the responsible and efficient extraction of oil and gas resources in the state. It maximizes the utilization of available acreage, minimizes surface disturbance, optimizes resource recovery, and fosters fair distribution of benefits among leaseholders.Idaho Commoditization Agreement, also known as Idaho Commoditization Order, is a legal arrangement in the state of Idaho that allows multiple oil and gas leaseholders to pool their interests together to create a single drilling unit. Commoditization Agreement enables efficient development and optimal utilization of mineral resources, particularly in cases where individual leases or tracts are too small or fragmented to be economically feasible for exploration and production activities. This agreement is authorized under the Idaho Code, specifically Title 47, Chapter 18. It provides the framework for lessees to consolidate their rights within a specified area, known as a comm unitized unit. By pooling their interests, the lessees can collectively engage in drilling and production activities within the unit, treating it as a single lease instead of separate tracts. The Idaho Commoditization Agreement process involves obtaining approval from the Idaho Oil and Gas Conservation Commission (LOGIC). The commission reviews the proposed agreements to ensure regulatory compliance, equitable sharing of production, and protection of the correlative rights of all interested parties. Once approved, the comm unitized unit is established, and operations can commence under the terms outlined in the agreement. There are different types of Idaho Commoditization Agreements, based on the specific circumstances and needs of the leaseholders. Some common types include: 1. Voluntary Commoditization Agreement: This occurs when leaseholders voluntarily agree to combine their leases within a defined area. It is commonly pursued to enhance operational efficiencies, reduce costs, and increase productivity. 2. Compulsory Commoditization Agreement: In situations where some leaseholders are unwilling to participate in a voluntary agreement, other leaseholders can request a compulsory commoditization order from the LOGIC. This allows the formation of a comm unitized unit without the consent of all leaseholders. 3. Temporary Commoditization Agreement: This agreement is established for a limited period, often used when a primary well is temporarily shut down due to maintenance or other issues. It enables other leaseholders to continue operations and prevent unnecessary and uneconomical cessation of production. 4. Unit Agreement Modification: Sometimes, existing commoditization agreements require modifications due to changes in circumstances, technological advancements, or shifts in lease ownership. Leaseholders can propose modifications to the LOGIC, which will then evaluate the request and approve or deny it based on its merits. Idaho Commoditization Agreement plays a pivotal role in promoting the responsible and efficient extraction of oil and gas resources in the state. It maximizes the utilization of available acreage, minimizes surface disturbance, optimizes resource recovery, and fosters fair distribution of benefits among leaseholders.
