This form is used when royalty owners are the owners of royalty and mineral interests in Tracts 1 and 2, subject to the terms of Lease 1 and Lease 2. Recognizing that each of the Royalty Owners may not own an Interest in both Tracts 1 and 2, or may not own an identical Interest in Tracts 1 and 2, it is their desire, together with Lessee, to pool and unitize these two Tracts for oil and gas operations.
A Michigan Pooling Agreement Between Lessee and Royalty Owners on Two Tracts, With Depth Limitation refers to a legal contract that regulates the combining or pooling of oil and gas resources from two separate tracts of land in the state of Michigan. This agreement is relevant for individuals or companies involved in the oil and gas industry operating in Michigan. This description will provide a comprehensive overview of the Michigan Pooling Agreement, its purpose, key components, and any variants of this agreement. The purpose of a Michigan Pooling Agreement Between Lessee and Royalty Owners on Two Tracts, With Depth Limitation is to allow the lessee (the party with the right to extract oil and gas) to pool or combine the reserves from two different tracts of land. These tracts may be owned by different royalty owners who are entitled to a share of the proceeds generated from the oil and gas production. The pooling agreement provides a structure to ensure fair distribution of revenues among the royalty owners while maximizing production efficiency. The key components of this pooling agreement include: 1. Identification of the Parties: The agreement will identify the lessee and the individual or entity holding the royalty interest on each of the two tracts of land. 2. Tract Description and Depth Limitation: The agreement will outline the specific legal description of each tract of land involved, ensuring clarity on the boundaries and location. Additionally, a depth limitation clause restricts pooling activities to a certain depth range of the oil and gas formations. 3. Pooling Terms: The agreement will define the terms of pooling, including the pooling area, its boundaries, and the method used for calculating each royalty owner's share of production from the pooled area. It may also outline any cost-sharing arrangements between the parties. 4. Royalty Payments: The agreement will establish the percentage of royalties or other compensation each royalty owner is entitled to receive from the pooled production. These terms generally adhere to Michigan state law or lease specifications. 5. Duration and Termination: The agreement typically specifies the duration and conditions for termination, allowing for renegotiation of terms or the possibility of extension upon mutual agreement. Different types or variants of the Michigan Pooling Agreement Between Lessee and Royalty Owners on Two Tracts, With Depth Limitation may arise based on specific circumstances or additional provisions added to the contract. These variants could include agreements with multiple tracts, agreements where royalty owners share in operational costs, agreements with specific well spacing requirements, or agreements that incorporate lease extension options. In conclusion, a Michigan Pooling Agreement Between Lessee and Royalty Owners on Two Tracts, With Depth Limitation is a legal document that facilitates the pooling of oil and gas resources from separate tracts of land in Michigan. This detailed description covers the purpose, key components, and potential variants of such an agreement, providing a comprehensive understanding of its relevance in the oil and gas industry in Michigan.
