This form provides that when Operator, in good faith, believes or determines that the actual costs for any Drilling, Reworking, Sidetracking, Deepening, or Plugging Back operation conducted under this Agreement will exceed a designated of the costs estimated for the operation on the approved AFE, the Operator will give prompt notice by telephone to the other Parties participating in the operation, as well as delivering a supplemental AFE estimating the costs necessary to complete the operation. Each Party receiving the supplemental AFE shall have forty-eight from receipt of the notice to elect to approve Operators recommendation or propose an alternative operation.
Maryland Cost Overruns for Non-Operator's Non-Consent Option is a legal provision that specifically addresses situations in oil and gas exploration and production ventures where the non-operator party does not consent to drilling or other costly activities, resulting in cost overruns. This option enables non-operators to limit their financial liability and protect their interests in the investment. In Maryland, there are two types of Cost Overruns for Non-Operator's Non-Consent Option: 1. Dry Hole Cost Overruns: This occurs when the well drilled under non-operator non-consent results in a dry hole, meaning it does not yield any commercially viable reserves. In such cases, the non-operator who did not consent to the drilling will not be liable for any cost overruns incurred in the process. 2. Successful Well Cost Overruns: Conversely, if the well drilled under non-operator non-consent turns out to be successful and discovers valuable reserves, the non-operator may still be subject to cost overruns. However, the extent of their financial liability will typically be limited to a certain percentage or proportion of their initial investment or interest in the project. It's important to note that the specifics of Maryland Cost Overruns for Non-Operator's Non-Consent Option can vary depending on the terms outlined in the operating agreement between the parties involved. These agreements typically establish the framework for how cost overruns are allocated and how non-operators can exercise their non-consent option. It is advisable for individuals or entities considering participation in oil and gas ventures in Maryland to thoroughly review and understand the provisions and implications of the Cost Overruns for Non-Operator's Non-Consent Option. Consulting with legal professionals experienced in energy law can provide valuable guidance and ensure that the rights and interests of all parties involved are safeguarded.Maryland Cost Overruns for Non-Operator's Non-Consent Option is a legal provision that specifically addresses situations in oil and gas exploration and production ventures where the non-operator party does not consent to drilling or other costly activities, resulting in cost overruns. This option enables non-operators to limit their financial liability and protect their interests in the investment. In Maryland, there are two types of Cost Overruns for Non-Operator's Non-Consent Option: 1. Dry Hole Cost Overruns: This occurs when the well drilled under non-operator non-consent results in a dry hole, meaning it does not yield any commercially viable reserves. In such cases, the non-operator who did not consent to the drilling will not be liable for any cost overruns incurred in the process. 2. Successful Well Cost Overruns: Conversely, if the well drilled under non-operator non-consent turns out to be successful and discovers valuable reserves, the non-operator may still be subject to cost overruns. However, the extent of their financial liability will typically be limited to a certain percentage or proportion of their initial investment or interest in the project. It's important to note that the specifics of Maryland Cost Overruns for Non-Operator's Non-Consent Option can vary depending on the terms outlined in the operating agreement between the parties involved. These agreements typically establish the framework for how cost overruns are allocated and how non-operators can exercise their non-consent option. It is advisable for individuals or entities considering participation in oil and gas ventures in Maryland to thoroughly review and understand the provisions and implications of the Cost Overruns for Non-Operator's Non-Consent Option. Consulting with legal professionals experienced in energy law can provide valuable guidance and ensure that the rights and interests of all parties involved are safeguarded.
