This form is used when the parties own undivided leasehold interests in the Lease as to depths from the surface of the ground to a Specific Depth. The parties acknowledge that the production from a well on the leasehold interest will be obtained from depths in which the ownership is not common. Thus, the parties find it necessary to enter into this Agreement to enable the parties to each be paid a proportionate part of the commingled production from the separate depths in which they own interests.
Illinois Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore, Where Leasehold Ownership Varies As to Depth is a legal agreement that governs the joint production from different formations in the same well bore, particularly in cases where leasehold ownership varies based on the depth of the well. This type of agreement allows working owners (individuals or entities) to effectively pool their resources and combine production from multiple formations within a single well. It ensures fair sharing of costs, risks, and production revenues among the working owners involved. This agreement is specifically designed to address situations where leasehold ownership differs depending on the depth of the well, meaning that different owners have rights to specific formations within the same well bore. Key components of an Illinois Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore, Where Leasehold Ownership Varies As to Depth may include: 1. Purpose: Clearly define the purpose of the agreement, which is to authorize the commingling of production from various formations located within the same well bore. 2. Commencement and Term: Specify the commencement date and the duration of the agreement. It is common for agreements of this nature to have a fixed term, typically aligned with the lease agreements in place. 3. Working Interests and Ownership: Detail the working interests and the percentage ownership of each party involved in the agreement. This section also addresses ownership variations based on the depth of the well and identifies the specific formations covered by each owner's leasehold rights. 4. Commingling of Production: Outline the process and procedure for commingling the production from different formations. This includes the equipment, mechanisms, and measurements required for accurate allocation of production. 5. Gross Proceeds Allocation: Specify how the gross proceeds from the commingled production will be allocated among the working owners. This could be based on the proportion of ownership interests or other agreed-upon allocation methods. 6. Expenses: Address the distribution of expenses related to operating the well, including drilling, completion, maintenance, and ongoing production costs. Clarify how joint expenses will be shared, considering the variation in leasehold ownership based on formation depth. 7. Accounting and Reporting: Define the accounting and reporting procedures to track production volumes, revenues, and expenses. This may involve regular reports to be submitted by each working owner and the appointment of an accountant or auditor to oversee the financial aspects. It is important to note that the specific names of different Commingling Agreements among working owners as to production from different formations out of the same well bore where leasehold ownership varies as to depth may vary, as they are tailored to individual circumstances.Illinois Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore, Where Leasehold Ownership Varies As to Depth is a legal agreement that governs the joint production from different formations in the same well bore, particularly in cases where leasehold ownership varies based on the depth of the well. This type of agreement allows working owners (individuals or entities) to effectively pool their resources and combine production from multiple formations within a single well. It ensures fair sharing of costs, risks, and production revenues among the working owners involved. This agreement is specifically designed to address situations where leasehold ownership differs depending on the depth of the well, meaning that different owners have rights to specific formations within the same well bore. Key components of an Illinois Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore, Where Leasehold Ownership Varies As to Depth may include: 1. Purpose: Clearly define the purpose of the agreement, which is to authorize the commingling of production from various formations located within the same well bore. 2. Commencement and Term: Specify the commencement date and the duration of the agreement. It is common for agreements of this nature to have a fixed term, typically aligned with the lease agreements in place. 3. Working Interests and Ownership: Detail the working interests and the percentage ownership of each party involved in the agreement. This section also addresses ownership variations based on the depth of the well and identifies the specific formations covered by each owner's leasehold rights. 4. Commingling of Production: Outline the process and procedure for commingling the production from different formations. This includes the equipment, mechanisms, and measurements required for accurate allocation of production. 5. Gross Proceeds Allocation: Specify how the gross proceeds from the commingled production will be allocated among the working owners. This could be based on the proportion of ownership interests or other agreed-upon allocation methods. 6. Expenses: Address the distribution of expenses related to operating the well, including drilling, completion, maintenance, and ongoing production costs. Clarify how joint expenses will be shared, considering the variation in leasehold ownership based on formation depth. 7. Accounting and Reporting: Define the accounting and reporting procedures to track production volumes, revenues, and expenses. This may involve regular reports to be submitted by each working owner and the appointment of an accountant or auditor to oversee the financial aspects. It is important to note that the specific names of different Commingling Agreements among working owners as to production from different formations out of the same well bore where leasehold ownership varies as to depth may vary, as they are tailored to individual circumstances.
