This lease rider form may be used when you are involved in a lease transaction, and have made the decision to utilize the form of Oil and Gas Lease presented to you by the Lessee, and you want to include additional provisions to that Lease form to address specific concerns you may have, or place limitations on the rights granted the Lessee in the “standard” lease form.
Wisconsin Offset Well Protection and Payment of Compensatory Royalty are regulations and policies implemented in Wisconsin to ensure the protection of oil and gas wells from the adverse effects of nearby development activities. These regulations are crucial in maintaining the integrity and productivity of offset wells while also compensating for any potential damages caused. Offset Well Protection: Offset well protection refers to the measures taken to safeguard existing oil and gas wells from the detrimental impacts of neighboring activities, such as drilling, hydraulic fracturing, or construction. The primary objective is to prevent any negative effects on the offset wells' production, including reduced yields, contamination, or well bore damage. To achieve offset well protection, the State of Wisconsin establishes minimum setback distances between new development activities and existing wells. These distances ensure that offset wells are not compromised by neighboring operations. Compliance with these setback requirements is mandatory for all developers to safeguard the stability and safety of the offset wells' operations. Payment of Compensatory Royalty: Payment of compensatory royalty is a mechanism employed by Wisconsin to compensate offset well owners for potential losses or damages caused by nearby development activities. It ensures that owners of offset wells receive fair compensation for any adverse impact on their production or economic losses incurred. When a development project encroaches upon the established setback distances, it may trigger payment of compensatory royalty to the offset well owner. This compensation can include a share of the profits made from the neighboring activity, reimbursement for any mitigation expenses incurred, or a lump sum payment to offset any economic losses faced by the well owner. Types of Wisconsin Offset Well Protection and Payment of Compensatory Royalty: There are various types of offset well protection and compensatory royalty regulations observed in Wisconsin. These include: 1. Minimum setback distances: Wisconsin sets specific distance requirements between new development activities and offset wells to ensure sufficient space and prevent potential interference. 2. Spacing regulations: The state enforces regulations on the minimum distance between new wells to avoid overcrowding and interference issues that could affect neighboring offset wells. 3. Seismic monitoring: Periodic seismic monitoring is carried out to detect any potential shifts or disturbances caused by nearby activities. This helps in early detection of potential issues and prompt response to mitigate any adverse impacts on offset wells. 4. Compensatory royalty fees: Depending on the magnitude and proximity of the development project, compensatory royalty fees may be collected from the developers and allocated to the affected offset well owners. These fees ensure fair compensation for any negative consequences experienced. These regulations and compensatory measures demonstrate the importance placed on offset well protection and the equitable compensation of well owners in Wisconsin. They are essential safeguards to maintain the productivity and viability of the state's oil and gas resources while also promoting responsible and sustainable development practices.
