Utah Admin. Code 649-2-13

Current through Bulletin 2024-18, September 15, 2024

Section R649-2-13 - Application of a Compulsory Pooling Order to Subsequently Drilled Wells in a Drilling Unit

1. An initial board order compulsory pooling any interests in a drilling unit, including the terms and conditions of a JOA as adopted by the board, shall apply to any subsequently drilled well in the drilling unit as authorized under Subsection 40-6-6.5(12), subject to compliance with the following:

1.1. The operator has filed with the board a motion to modify the initial order to apply its terms to an additional well in the drilling unit which sets forth by affidavit:

1.1.1. The docket and cause numbers of said initial board order;

1.1.2. The location, identification, and description of the well drilled to which the order is to apply;

1.1.3. An identification of those owners who the operator asserts have no consented to participate in the subsequent well after having been provided a notice of an opportunity to participate and failing to consent or make objections as allowed by Section R649-2-8a, and those owners who are either locatable, unlocatable, or cannot be identified;

1.1.4. Certification that the operator has made reasonable efforts to locate and provide notice to the alleged Nonconsenting owner which shall include:

1.1.4.1. Copies of the written notice of opportunity to participate sent to them together with a proof of service; or

1.1.4.2. Proof of notice by publication as required by Subsection R649-2-9a (1.2) if any such alleged Nonconsenting owner is unlocatable or not identified; and

1.1.5. A statement that the average weighted landowner's royalty for the drilling unit remains the same as that provided for in the initial board order or a calculation of the average weighted landowner's royalty for the drilling unit at the time of commencement of the drilling of the subsequent well as provided in Subsection 40-6-6.5(6);

1.1.6. The anticipated costs of plugging the well; and

1.1.7. The risk compensation award as determined by the board in the original order; and

1.2. The motion to modify the initial board order has been mailed by the operator, together with copies of the initial board order and a recitation of the provisions of Subsection 40-6-6.5(12) and Subsection R649-2-8a to any such alleged nonconsenting owners, with a certification of service evidencing the same executed and filed with the board; and

1.3. Within 30 days of the mailing of the motion, no party has filed any objection to the motion to modify the initial board order to apply to the subsequently drilled well in the drilling unit, including, without limitation, any objection to said party's alleged nonconsent status, the applicable risk compensation percentage or the reasonableness of the actual costs incurred for the subsequently drilled well.

2. Upon a written notice filed with the board stating the foregoing conditions have been satisfied, the board may enter an order declaring its initial compulsory pooling order to be applicable to such subsequently drilled well, with modifications for the matters addressed in the motion to modify the order.

3. If an owner or other person with an interest affected by the motion shall have filed an objection within 30 days of the mailing of the motion to modify the order including, but not limited to, an objection to said person's alleged nonconsent status, the applicable risk compensation percentage, or the reasonableness of the costs of the well, then the board shall set a time for a hearing in accordance with Rules of Practice Before the Board in Rule R641-100.

3.1. The hearing shall be limited to addressing the objections to the motion to modify the order as asserted by any party.

3.2. The operator shall have the burden to satisfy the requirements under Section 40-6-6.5 for the granting of the motion and the objecting owner shall have the burden of establishing the merit to its objections.

3.3. The board shall enter an order determining the application of the initial order to the subsequent well as to any party who filed objections, and how the initial order will apply to others who have not objected.

4. If there are no objections made to the motion to modify the initial compulsory pooling order, the initial order shall apply to the subsequent well as requested.

5. The terms of any JOA adopted by the board in an initial compulsory pooling order and applicable to any subsequent order may not be in the contravention of the provisions under Section 40-6-6.5, including providing that an owner shall be entitled to receive notice of opportunity to participate in any subsequent well proposed in the drilling unit regardless of the owner's prior consent or nonconsent status on a prior well in the drilling unit.

Utah Admin. Code R649-2-13

Adopted by Utah State Bulletin Number 2020-12, effective 6/1/2020

Amended by Utah State Bulletin Number 2020-15, effective 7/27/2020