Exhibit E to Operating Agreement Gas Balancing Agreement - Form 4
What is this form?
The Exhibit E to Operating Agreement: Gas Balancing Agreement - Form 4 is a legal document that addresses how parties to an operating agreement can manage gas imbalances. Specifically, it outlines the procedures for parties who take less than their percentage share of gas produced. This form helps clarify the rights for taking gas that was not utilized by an underproducer during a specified period, ensuring all parties can access their fair share according to their ownership interests.
Key components of this form
- Gas Imbalances: Details how parties can take gas that is not utilized by others.
- Volumetric Balancing: Defines terms related to overproduction and underproduction to ensure fair distribution.
- Notification Requirements: Specifies how and when parties must notify the operator of their gas volume intentions.
- Final Cash Balancing: Describes the procedure for settling balances after gas production ceases.
- Transfers of Interest: Outlines the obligations of an overproducer if they transfer their interest to a new party.
When to use this form
This form should be used when parties involved in an operating agreement need to address imbalances in natural gas production. It applies specifically when one or more parties take less gas than they are entitled to based on their ownership stake. The agreement outlines how these deficiencies can be compensated and managed among the parties, ensuring none are unfairly disadvantaged.
Who needs this form
- Operators or managers of gas production facilities.
- Individuals or companies involved in a joint venture for gas extraction.
- Parties looking to clarify gas rights and responsibilities in an operating agreement.
- Legal professionals advising clients on gas balancing and operating agreements.
How to complete this form
- Identify all parties involved in the gas production agreement and record their percentage interest shares.
- Document any gas imbalances and the agreed-upon method for resolving these issues according to ownership interests.
- Ensure that each party provides timely notifications to the operator regarding their intended gas volumes.
- Complete the final cash balancing procedure, ensuring that all overproduced and underproduced amounts are settled within the stipulated timelines.
- Include any necessary provisions regarding the transfer of interests and obligations based on gas production.
Notarization guidance
In most cases, this form does not require notarization. However, some jurisdictions or signing circumstances might. US Legal Forms offers online notarization powered by Notarize, accessible 24/7 for a quick, remote process.
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Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Common mistakes
- Failing to notify the operator in a timely manner about intended gas volumes.
- Not accurately calculating each partyâs percentage interest in production.
- Overlooking the requirement for written notices of gas makeup by underproduced parties.
- Neglecting to address tax obligations related to gas production within the document.
Benefits of completing this form online
- Convenience of immediate access and download anytime.
- Editable templates that can be tailored to fit specific needs.
- Reliable legal language drafted by licensed attorneys, ensuring accuracy.
- Easy to fill out with clear instructions, helping to prevent common errors.
Quick recap
- The Gas Balancing Agreement provides a structured way to manage gas production imbalances among parties.
- It's important for all parties to understand their rights and obligations according to their ownership percentages.
- Timely notification and documentation are essential to avoid disputes.
- This form is applicable in various jurisdictions, making it flexible for multi-state use.
