A farmout agreement is used when the "farmor" agrees to assign acreage to the "farmee" in return for the "farmee" performing specified drilling and testing obligations, with the "farmor" also reserving an interest in the acreage assigned and in the production from the wells drilled by the second company.
A Suffolk New York Farm out Agreement Providing for Single Well, with Dry Hole Earning an Assignment is a legal contract between two parties in the oil and gas industry. This agreement outlines the terms and conditions for the development of a single well in Suffolk, New York, where one party (the Farmer) agrees to drill and operate the well, while the other party (the Armor) retains an interest in the project. Keywords: Suffolk New York, Farm out Agreement, Single Well, Dry Hole, Earning an Assignment This particular type of Farm out Agreement is structured to handle the potential outcome of a dry hole, which refers to a well that does not yield a commercially viable amount of oil or gas. In this scenario, the Farmer is given an opportunity to earn an assignment, meaning they have the chance to obtain a portion of the Armor's interest in the well or future drilling prospects. The Suffolk New York Farm out Agreement Providing for Single Well, with Dry Hole Earning an Assignment typically includes the following key provisions: 1. Parties: It identifies the Armor (the owner of the existing lease or working interest) and the Farmer (the party seeking an assignment of interest). 2. Objectives: It outlines the specific objectives of the agreement, which is the development and drilling of a single well within Suffolk, New York. 3. Financial Considerations: It details the financial terms, such as the payment of a farm out fee, reimbursement for drilling and operational expenses, and how costs and revenues will be shared between the parties. 4. Work Obligations: It clarifies the responsibilities of both parties, such as the obligation of the Farmer to drill, complete, and operate the well in a timely and competent manner. 5. Dry Hole Provision: It addresses the possibility of a dry hole, stating that if the well does not produce a commercially viable amount of oil or gas, the Farmer may earn an assignment of interest from the Armor. 6. Assignment of Interest: It outlines the conditions under which the Farmer can earn an assignment, including the amount of interest they will be able to acquire and any associated costs or commitments. 7. Termination Clause: It specifies the circumstances under which the agreement can be terminated, such as breach of contract or failure to adhere to the agreed-upon timeline. Types of Suffolk New York Farm out Agreements Providing for Single Well, with Dry Hole Earning An Assignment may include variations based on factors such as the size of the interest being assigned, the specific terms for earning the assignment, and the conditions for termination. It's important for parties involved in such agreements to consult with legal professionals to ensure the agreement meets their specific needs and complies with applicable laws and regulations in Suffolk, New York.A Suffolk New York Farm out Agreement Providing for Single Well, with Dry Hole Earning an Assignment is a legal contract between two parties in the oil and gas industry. This agreement outlines the terms and conditions for the development of a single well in Suffolk, New York, where one party (the Farmer) agrees to drill and operate the well, while the other party (the Armor) retains an interest in the project. Keywords: Suffolk New York, Farm out Agreement, Single Well, Dry Hole, Earning an Assignment This particular type of Farm out Agreement is structured to handle the potential outcome of a dry hole, which refers to a well that does not yield a commercially viable amount of oil or gas. In this scenario, the Farmer is given an opportunity to earn an assignment, meaning they have the chance to obtain a portion of the Armor's interest in the well or future drilling prospects. The Suffolk New York Farm out Agreement Providing for Single Well, with Dry Hole Earning an Assignment typically includes the following key provisions: 1. Parties: It identifies the Armor (the owner of the existing lease or working interest) and the Farmer (the party seeking an assignment of interest). 2. Objectives: It outlines the specific objectives of the agreement, which is the development and drilling of a single well within Suffolk, New York. 3. Financial Considerations: It details the financial terms, such as the payment of a farm out fee, reimbursement for drilling and operational expenses, and how costs and revenues will be shared between the parties. 4. Work Obligations: It clarifies the responsibilities of both parties, such as the obligation of the Farmer to drill, complete, and operate the well in a timely and competent manner. 5. Dry Hole Provision: It addresses the possibility of a dry hole, stating that if the well does not produce a commercially viable amount of oil or gas, the Farmer may earn an assignment of interest from the Armor. 6. Assignment of Interest: It outlines the conditions under which the Farmer can earn an assignment, including the amount of interest they will be able to acquire and any associated costs or commitments. 7. Termination Clause: It specifies the circumstances under which the agreement can be terminated, such as breach of contract or failure to adhere to the agreed-upon timeline. Types of Suffolk New York Farm out Agreements Providing for Single Well, with Dry Hole Earning An Assignment may include variations based on factors such as the size of the interest being assigned, the specific terms for earning the assignment, and the conditions for termination. It's important for parties involved in such agreements to consult with legal professionals to ensure the agreement meets their specific needs and complies with applicable laws and regulations in Suffolk, New York.
