Authorization For Expenditure - "AFE"
What this document covers
The Authorization For Expenditure (AFE) is a document used to obtain approval for costs and expenses related to drilling and other operations in the oil and gas industry. This form outlines the proposed expenditures and allows for joint operator approval, making it distinct from other expense approval forms due to its industry-specific applications and detailed breakdown of costs.
Key components of this form
- AFE Number: Unique identifier for tracking costs.
- Company Information: Name of the company and lease details.
- Well Details: Includes well number, proposed depth, and location.
- Cost Breakdown: Detailed line items for both intangible and tangible costs related to drilling and completion.
- Approval Signatures: Spaces for company and joint operator approvals along with titles and dates.
When to use this document
This form is typically used in the exploration and production phases of oil and gas projects. It is necessary when a company needs formal approval for the projected costs associated with drilling a well, including materials and labor. Situations may include planning for a new drilling site, reworking existing wells, or assessing the financial impact of proposed drilling operations.
Who should use this form
- Oil and gas companies looking to finance drilling operations.
- Joint venture partners involved in shared drilling projects.
- Project managers responsible for budgeting and approving expenditures.
- Financial officers overseeing the allocation of resources for exploration activities.
How to complete this form
- Identify the company and project details, including the well name and intended depth.
- Fill out the cost breakdown section, detailing all expected expenses categorized into intangible and tangible costs.
- Ensure accuracy in the estimated days for drilling and other operations needed to complete the project.
- Have the responsible parties review and sign for approval to validate the expenditure.
- Submit the completed form to the appropriate stakeholders for record-keeping and financial management.
Notarization requirements for this form
Notarization is not commonly needed for this form. However, certain documents or local rules may make it necessary. Our notarization service, powered by Notarize, allows you to finalize it securely online anytime, day or night.
Common mistakes to avoid
- Forgetting to include all necessary signatures for approval.
- Omitting details in the cost breakdown section, leading to inaccurate budgeting.
- Failing to validate the applicability of state-specific requirements before submission.
- Incorrectly estimating the number of days needed for drilling or other operations.
Why use this form online
- Convenience of downloading and completing the form at your pace.
- Editability, allowing for adjustments as project plans change.
- Access to templates drafted by licensed attorneys, ensuring legal compliance and accuracy.
