Arkansas Surface Use Agreement Establishing Amounts Lessee Will Pay For Road and Location Damages

• Category: Oil Gas and Minerals - Agreements
• State: Multi-State
• Control #: US-OG-152
• Format: Word; Rich Text

Description

This is a form of agreement that would be entered into in connection with an oil and gas lease and provides for the sum to be paid for drill site locations and roads.

Arkansas Surface Use Agreement Establishing Amounts Lessee Will Pay For Road and Location Damages Overview: A surface use agreement, specific to Arkansas state regulations, is a legally binding contract entered into between the lessee (oil, gas, or mineral rights' owner) and the surface owner. This agreement outlines the compensation that the lessee must pay to the surface owner for any damages caused to roads and locations during exploration, drilling, production, or transportation activities. The primary objective is to establish fair compensation amounts for the surface owner's inconvenience, disruption, and property damages resulting from the lessee's operations. Different types of road and location damages that lessees may be obligated to pay include but are not limited to: 1. Road Damage Compensation: Under the Arkansas Surface Use Agreement, lessees will pay for any road damages incurred due to their oil, gas, or mineral extraction activities. This includes compensation for the deterioration or destruction of roads caused by heavy machinery, transportation vehicles, drilling equipment, and other related operations. The agreement specifies the types of roads covered, including private roads, public roads, gravel roads, dirt roads, and any other roadways that may be affected by the lessee's activities. The payment structure is typically established based on the extent of damage and the repair or reconstruction costs. 2. Location Damage Compensation: The Arkansas Surface Use Agreement also addresses damages caused to the leased property's locations. Locations are defined as specific areas where exploration, drilling, and production activities occur (e.g., well pads, access roads, storage yards, etc.). Lessees are responsible for compensating surface owners for any damages, including excavation, topsoil removal, grading, vegetation disturbance, erosion control, drainage modification, and other disturbances caused by their operations. The compensation amounts are determined based on reclamation and restoration costs, ensuring that the surface owner's land is restored to its original state or as close as reasonably practicable. 3. Compensation Calculation Methodologies: To establish fair and reasonable compensation for road and location damages, different calculation methodologies are utilized in the Surface Use Agreement. Some common approaches include: — Flat Rate: A predetermined fixed compensation amount agreed upon between the lessee and the surface owner, irrespective of the extent of damage or the duration of operations. — Damage-Based Evaluation: Compensation is determined by assessing the actual damages incurred on the roads and locations. This evaluation involves considering factors such as surface area affected, restoration costs, and any additional inconvenience borne by the surface owner. — Time-Based Compensation: Compensation is calculated over a specific time period, accounting for the duration of operations and the level of disruption caused to the surface owner's property. This approach may involve monthly, yearly, or other agreed-upon payment schedules. It is essential for both parties involved to carefully review and negotiate the terms and compensation provisions within the Arkansas Surface Use Agreement. Consulting legal professionals familiar with oil, gas, and mineral rights laws in Arkansas are highly advisable to ensure a fair and comprehensive agreement that protects the interests and rights of both the lessee and the surface owner.