This form is a Texas Lease agreement wherein Lessor grants, leases, and lets exclusively to Lessee the lands described within for the purposes of conducting seismic and geophysical operations, exploring, drilling, mining, and operating for, producing and owning oil, gas, sulfur, and all other minerals whether or not similar to those mentioned (collectively the oil or gas ), and the right to make surveys, lay pipelines, establish and utilize facilities for surface or subsurface disposal of salt water, construct roads and bridges, dig canals, build tanks, power stations, power lines, telephone lines, and other structures on the Lands, necessary or useful in Lessee's operations on the Lands or any other land adjacent to the Lands. This lease form also provides for pooling.
The Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling Shut-In Royalty Provision is an important component of oil and gas industry leases in the Corpus Christi region of Texas. This provision outlines the agreement between the lessor and lessee regarding the pooling and shut-in of leased properties for royalty purposes. Keywords: Corpus Christi Texas, Producers 88, (8/99), Rental Lease Pooling, Shut-In Royalty Provision 1. Overview of Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling Shut-In Royalty Provision: The Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling Shut-In Royalty Provision is a contractual agreement between the property owner (lessor) and the oil and gas company (lessee). It specifies the terms and conditions for pooling multiple leased properties in a specific area to increase efficiency and optimize production. Additionally, it outlines the circumstances and compensation for shutting-in production temporarily. 2. Purpose of Rental Lease Pooling: Rental Lease Pooling allows the lessee to combine several leased properties in the Corpus Christi region to create a more efficient drilling and production plan. By pooling the leases, the lessee can overcome physical and logistical limitations, access larger reservoirs, and increase the overall productivity of the oil and gas operations. 3. Shut-In Royalty Provision: The Shut-In Royalty Provision within the Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling agreement pertains to the temporary cessation of production due to various reasons. When the lessee suspends production on a leased property due to market conditions, lack of demand, equipment failure, or any other valid reason, they are obligated to pay the lessor a shut-in royalty. This royalty compensates the lessor for the inability to extract and sell the oil and gas during the shut-in period. Types of Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling Shut-In Royalty Provisions: 1. Temporary Shut-In Royalty Provision: This provision is triggered when the lessee temporarily suspends production due to non-permanent factors, such as repair work, market fluctuations, or logistical issues. The lessor receives a specified shut-in royalty payment during the temporary production shutdown. 2. Extended Shut-In Royalty Provision: If the lessee anticipates a longer interruption in production, this provision may be invoked. It outlines the compensation terms when a property remains shut-in for an extended period, typically due to major equipment breakdowns, regulatory constraints, or significant market downturns. 3. Voluntary Shut-In Royalty Provision: This provision is designed to protect the interests of both parties when the lessee voluntarily decides to shut-in production due to unprofitable market conditions. It ensures that the lessor receives fair compensation during the period in which oil and gas extraction is temporarily halted. In conclusion, the Corpus Christi Texas Producers 88 (8/99) Rental Lease Pooling Shut-In Royalty Provision is a critical component of oil and gas leases in the Corpus Christi region. It enables the efficient pooling of leased properties and defines compensation terms for shut-in production. The provision ensures a fair balance between the interests of the lessor and lessee, safeguarding both parties' financial and operational concerns.
