This Designation is executed by the Operator and Working Interest Owners and filed of record for the purpose of evidencing their election to exercise the pooling authority granted to the lessees in the Leases, to give notice of the Unit being established, and to identify and describe the lands included in the Unit.
The North Carolina Designation of Pooled Unit and Declaration of Pooling for Oil or Gas is an essential legal document in the oil and gas industry. It establishes the legal framework within which multiple oil or gas leases can be consolidated into a single drilling unit or pool. By pooling the interests of various leaseholders, this process allows for efficient and coordinated extraction of oil or gas resources. The primary purpose of the North Carolina Designation of Pooled Unit and Declaration of Pooling for Oil or Gas is to prevent waste, maximize resource recovery, and promote fairness among leaseholders. By consolidating multiple leases, operators can effectively plan and execute drilling operations, reducing duplication and unnecessary surface disruption. There are several types of pooled units and declarations of pooling that can be found in North Carolina, each serving different purposes and catering to specific operational scenarios: 1. Traditional Pooling: This type of pooling occurs when all leaseholders within a specific designated area agree to consolidate their leases into a single pooled unit. The consolidated unit allows for coordinated drilling and production activities, enabling efficient resource recovery. 2. Compulsory Pooling: In situations where one or more leaseholders refuse or fail to voluntarily join a pooled unit, compulsory pooling may be invoked. Also known as forced pooling or mandatory pooling, this process requires the non-consenting leaseholder(s) to participate in the unit, subject to fair compensation. Compulsory pooling ensures that leaseholders who may be reluctant or unable to participate are not excluded from benefiting from the pooled unit. 3. Horizontal Pooling: With the advent of advanced drilling techniques like hydraulic fracturing or fracking, horizontal pooling has gained prominence. This method involves drilling horizontal wells within the designated pooled unit to efficiently access and recover resources over a larger area. Horizontal pooling maximizes production while minimizing surface disturbance. 4. Unitization: In some cases, particularly when the productive reservoir extends beyond the boundaries of a single leasehold, unitization may be pursued. Unitization involves consolidating multiple leases and pooling units across different tracts of land to optimize resource recovery from a shared reservoir. This approach ensures that all leaseholders benefit equitably from the resource extraction, irrespective of their lease boundaries. The North Carolina Designation of Pooled Unit and Declaration of Pooling for Oil or Gas is a crucial tool that facilitates efficient resource extraction while protecting the rights and interests of leaseholders. Through various types of pooling arrangements, this legal framework promotes responsible and sustainable development of oil and gas resources in North Carolina.
