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.
Rhode Island Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore is a legal contract that governs the sharing of production from multiple formations within a single well bore in cases where the ownership of leasehold interests varies as to depth. This agreement is crucial in regulating the rights and responsibilities of the working interest owners involved in the drilling and production process. The primary objective of a Rhode Island Commingling Agreement is to establish a fair and equitable method for allocating production and revenue among the working owners. This agreement ensures that all parties involved benefit proportionally based on their ownership interests in the respective formations. The agreement typically outlines various important aspects including: 1. Definitions: Clearly defines the terms used throughout the agreement, such as working interest, leasehold interest, formation, well bore, and depth. 2. Formation Ownership and Depth Variations: Provides a comprehensive description of the different formations within the well bore and how the ownership of leasehold interests varies at different depths. It identifies the specific depths or intervals at which the different working owners have rights and ownership. 3. Commingling Plan: Details the plan for commingling production from the various formations and establishes the methodology for calculating the proportions in which production will be allocated among the working owners. 4. Sharing of Costs and Expenses: Specifies how the costs associated with drilling, completion, and maintenance of the well bore will be shared among the working owners. This ensures a fair distribution of financial responsibilities based on each owner's interest. 5. Allocation of Production and Royalties: Outlines the mechanism for allocating production and the subsequent distribution of revenues derived from the sale of the produced hydrocarbons. This typically involves assigning proportions based on the ownership interests, reserves, or other agreed-upon factors. 6. Reporting and Auditing: Establishes reporting requirements to keep all working owners informed about the production volumes, revenue, costs, and any necessary adjustments. The agreement may also provide provisions for periodic audits to ensure compliance with the terms of the agreement. 7. Dispute Resolution: Includes a dispute resolution mechanism, such as mandatory arbitration or mediation, to address any conflicts that may arise between the working owners regarding the interpretation or implementation of the agreement. It's important to note that the specific types of Rhode Island Commingling Agreements may vary depending on the unique circumstances and geological characteristics of the well bore and leasehold ownership. Examples of different types of agreements may include "Rhode Island Commingling Agreement Among Working Owners — Multiple Formations," "Rhode Island Commingling Agreement Among Working Owners — Depth-Based Ownership," or "Rhode Island Commingling Agreement Among Working Owners — Variations in Ownership Interests."Rhode Island Commingling Agreement Among Working Owners As to Production from Different Formations Out of the Same Well Bore is a legal contract that governs the sharing of production from multiple formations within a single well bore in cases where the ownership of leasehold interests varies as to depth. This agreement is crucial in regulating the rights and responsibilities of the working interest owners involved in the drilling and production process. The primary objective of a Rhode Island Commingling Agreement is to establish a fair and equitable method for allocating production and revenue among the working owners. This agreement ensures that all parties involved benefit proportionally based on their ownership interests in the respective formations. The agreement typically outlines various important aspects including: 1. Definitions: Clearly defines the terms used throughout the agreement, such as working interest, leasehold interest, formation, well bore, and depth. 2. Formation Ownership and Depth Variations: Provides a comprehensive description of the different formations within the well bore and how the ownership of leasehold interests varies at different depths. It identifies the specific depths or intervals at which the different working owners have rights and ownership. 3. Commingling Plan: Details the plan for commingling production from the various formations and establishes the methodology for calculating the proportions in which production will be allocated among the working owners. 4. Sharing of Costs and Expenses: Specifies how the costs associated with drilling, completion, and maintenance of the well bore will be shared among the working owners. This ensures a fair distribution of financial responsibilities based on each owner's interest. 5. Allocation of Production and Royalties: Outlines the mechanism for allocating production and the subsequent distribution of revenues derived from the sale of the produced hydrocarbons. This typically involves assigning proportions based on the ownership interests, reserves, or other agreed-upon factors. 6. Reporting and Auditing: Establishes reporting requirements to keep all working owners informed about the production volumes, revenue, costs, and any necessary adjustments. The agreement may also provide provisions for periodic audits to ensure compliance with the terms of the agreement. 7. Dispute Resolution: Includes a dispute resolution mechanism, such as mandatory arbitration or mediation, to address any conflicts that may arise between the working owners regarding the interpretation or implementation of the agreement. It's important to note that the specific types of Rhode Island Commingling Agreements may vary depending on the unique circumstances and geological characteristics of the well bore and leasehold ownership. Examples of different types of agreements may include "Rhode Island Commingling Agreement Among Working Owners — Multiple Formations," "Rhode Island Commingling Agreement Among Working Owners — Depth-Based Ownership," or "Rhode Island Commingling Agreement Among Working Owners — Variations in Ownership Interests."
