This form is used when any party electing not to participate in an exploratory well after the exploratory well has been drilled, relinquish and assign to the Drilling Party or Parties one hundred percent (100%) of its rights, title and interests in the Drilling Unit and the eight (8) Drilling Units directly and diagonally offsetting the Drilling Unit on which the well was drilled.
The Utah Relinquishment Provision is a regulatory framework that applies to exploratory wells in Utah. This provision helps facilitate the responsible exploration and exploitation of oil and gas resources in the region while also ensuring environmental protection and land use sustainability. An exploratory well refers to a type of drilling operation conducted to assess the potential for extracting oil or gas in an unproven or underexplored area. The Utah Relinquishment Provision establishes guidelines and timeframes for companies operating exploratory wells to either proceed with full-scale development or relinquish their leases. There are several types of Utah Relinquishment Provision — Exploratory Wells, each with its own specific conditions and requirements: 1. Initial Exploration Period: The initial exploration period allows companies to conduct exploratory drilling and testing to determine the resource potential of a specific lease. During this phase, companies are required to provide regular progress reports, geological data, and any environmental impact assessments. 2. Extension Period: In some cases, if a well shows promising results, companies may be granted an extension period to conduct further evaluation and testing. This usually occurs when additional data is required to make an informed decision regarding full-scale development. 3. Determination Period: Once the exploration period ends or the extension period concludes, a determination period begins. During this phase, companies must assess the gathered data and submit a comprehensive report detailing the well results, the estimated resource reserve volumes, and plans for full-scale development. 4. Plan of Development (POD): If the determination period confirms commercially viable reserves, the company is required to submit a Plan of Development (POD) to the responsible regulatory authorities. The POD outlines the proposed development activities, including drilling additional wells, infrastructure construction, and environmental mitigation measures. 5. Full-Scale Development or Relinquishment: Upon approval of the POD, the company can proceed with full-scale development, including production operations. However, if the POD is not approved or the company fails to submit a POD within the stipulated timelines, the Utah Relinquishment Provision requires them to relinquish the lease, freeing it up for other interested parties. Through the Utah Relinquishment Provision — Exploratory Well framework, Utah aims to strike a balance between encouraging exploration activities and safeguarding environmental resources. This regulatory mechanism ensures that unproductive or non-developing leases are relinquished, allowing for potential new exploration opportunities and reducing the environmental footprint in the region.
