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 Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment is a contractual arrangement between a landowner (armor) and an oil and gas company (farmer), where the farmer has the right to explore, drill, and produce oil and gas from a specific piece of land in Wake County, North Carolina. This agreement allows the farmer to earn an assignment of the leasehold interests by drilling a single well on the property. Keywords: Wake North Carolina, farm out agreement, single well, dry hole, earning an assignment, oil and gas, landowner, oil company, exploration, drilling, production, leasehold interests. There can be different variations or types of Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment, which include: 1. Traditional Farm out Agreement: This is the conventional form of agreement where the farmer pays the armor a cash consideration or a set bonus for the right to drill and produce oil and gas from the property. In the event of a dry hole, the farmer may earn an assignment of the leasehold interests by paying a certain amount to the armor. 2. Equitable Farm out Agreement: In this type of agreement, instead of paying cash consideration, the farmer may agree to contribute a certain percentage of the drilling and completion costs for the well. The farmer earns an assignment of the leasehold interests based on their equity contribution, regardless of the outcome of the well. 3. Royalty-Based Farm out Agreement: This variation of the agreement involves the armor receiving a percentage of the revenue generated from the production of oil and gas. The farmer pays for the drilling and completion costs as well as ongoing operational expenses. In the event of a dry hole, the farmer may still be entitled to earn an assignment based on the revenue-sharing arrangement. 4. Work Commitment Farm out Agreement: This type of agreement requires the farmer to commit to a minimum work program, which includes drilling and completing a well within a specified timeframe. If the farmer fails to fulfill the work program or encounters a dry hole, they may forfeit their right to an assignment. In summary, a Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment is a flexible contract that allows an oil and gas company to explore and produce oil and gas from a specific piece of land, with the option to earn an assignment of the leasehold interests based on certain conditions.A Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment is a contractual arrangement between a landowner (armor) and an oil and gas company (farmer), where the farmer has the right to explore, drill, and produce oil and gas from a specific piece of land in Wake County, North Carolina. This agreement allows the farmer to earn an assignment of the leasehold interests by drilling a single well on the property. Keywords: Wake North Carolina, farm out agreement, single well, dry hole, earning an assignment, oil and gas, landowner, oil company, exploration, drilling, production, leasehold interests. There can be different variations or types of Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment, which include: 1. Traditional Farm out Agreement: This is the conventional form of agreement where the farmer pays the armor a cash consideration or a set bonus for the right to drill and produce oil and gas from the property. In the event of a dry hole, the farmer may earn an assignment of the leasehold interests by paying a certain amount to the armor. 2. Equitable Farm out Agreement: In this type of agreement, instead of paying cash consideration, the farmer may agree to contribute a certain percentage of the drilling and completion costs for the well. The farmer earns an assignment of the leasehold interests based on their equity contribution, regardless of the outcome of the well. 3. Royalty-Based Farm out Agreement: This variation of the agreement involves the armor receiving a percentage of the revenue generated from the production of oil and gas. The farmer pays for the drilling and completion costs as well as ongoing operational expenses. In the event of a dry hole, the farmer may still be entitled to earn an assignment based on the revenue-sharing arrangement. 4. Work Commitment Farm out Agreement: This type of agreement requires the farmer to commit to a minimum work program, which includes drilling and completing a well within a specified timeframe. If the farmer fails to fulfill the work program or encounters a dry hole, they may forfeit their right to an assignment. In summary, a Wake North Carolina Farm out Agreement Providing For Single Well, with Dry Hole Earning An Assignment is a flexible contract that allows an oil and gas company to explore and produce oil and gas from a specific piece of land, with the option to earn an assignment of the leasehold interests based on certain conditions.
