The Nevada Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells is a legally binding document that allows for the inclusion of a shut-in provision in oil and gas lease agreements within the state of Nevada. This amendment provides additional flexibility for leaseholders by permitting the temporary cessation of production from an oil well without relinquishing the lease. The shut-in provision allows leaseholders to temporarily stop production from an oil well in cases where it may not be economically viable or technically feasible to continue extraction. This provision is particularly beneficial during periods of low oil prices or when maintenance or repairs are required. By shutting-in the well, leaseholders can avoid costly extraction operations while maintaining their lease rights. The Nevada Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells is designed to protect the interests of both the leaseholder and the state. By granting the temporary shutdown option, leaseholders can strategically manage their operations, preserving valuable resources and capital. At the same time, the state can ensure that the leaseholders remain actively engaged in oil and gas exploration and extraction, promoting economic growth and job opportunities. It is important to note that there are different types of amendments to oil and gas leases in Nevada that may include shut-in provisions. These variations typically depend on specific lease agreements, the duration of shut-in periods, and the conditions and criteria that must be met for shut-in to be permitted. Some common types of Nevada amendments for oil and gas leases include: 1. Short-term Shut-In Amendment: This amendment allows for temporary shutdowns of oil wells for a short duration, such as a few months, due to market conditions or maintenance requirements. 2. Long-term Shut-In Amendment: This type of amendment permits longer shutdown periods, ranging from six months to a few years. It is generally used when it is anticipated that the well may not be productive or profitable for an extended period. 3. Renewal Shut-In Amendment: This amendment is used when leaseholders wish to extend the initial shut-in period beyond the agreed-upon duration. It provides leaseholders with flexibility if they foresee a longer shut-in period due to unforeseen circumstances. By utilizing the Nevada Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells, leaseholders can better manage their operations, minimize costs during unfavorable market conditions, and ensure the long-term viability of their oil and gas leases in the state.
Nevada Amendment to Oil and Gas Lease to Add Shut-In Provision For Oil Wells
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in clause (or shutin royalty clause) traditionally allows the lessee to maintain the lease by making shutin payments on a well capable of producing oil or gas in paying quantities where the oil or gas cannot be marketed, whether due to a lack of pipeline connection or otherwise.
A Pugh Clause is enforced to ensure that a lessee can be prevented from declaring all lands under an oil and gas lease as being held by production. This remains true even when production only takes place on a fraction of the property.
A clause in an oil & gas lease that provides that if the leased land is later owned by separate parties, such as in a sale of part of the property, the lessee can continue to operate, develop, and treat the lease as a whole and pay royalties to each owner based on its percentage of ownership of the entire area.
in clause (or shutin royalty clause) traditionally allows the lessee to maintain the lease by making shutin payments on a well capable of producing oil or gas in paying quantities where the oil or gas cannot be marketed, whether due to a lack of pipeline connection or otherwise.
What is the granting clause? The granting clause is the clause under which the owner of the oil and gas rights leases the oil and gas rights to the oil and gas company along with the right to develop the oil and gas on a specifically described piece of real estate.
By way of background, a ?free use? clause is a provision in an oil/gas lease which gives the lessee the right to use gas produced from the leasehold.
Surrender Clause A clause commonly found in an oil and gas lease authorizing a lessee to release its rights to all or any portion of the leased premises at any time and be relieved of further obligations relating to the acreage surrendered.