This form is used in the event any part to this Agreement elects not to participate in a Horizontal Exploratory Well, the non-participating party shall, on commencement of operations for the well, relinquish to the participating party one hundred percent (100%) of its rights, title, and interests in and to that portion of the Contract Area included within the Drilling Unit for the well and one hundred percent (100%) of the party’s rights, title, and interests in and to that portion of the Contract Area.
Utah Relinquishment Provision — Horizontal Well refers to a specific provision implemented in the state of Utah pertaining to the drilling and operation of horizontal oil and gas wells. This provision outlines the guidelines and procedures for relinquishing the right to operate a horizontal well in Utah after certain criteria are met. The relinquishment provision is put into effect to promote efficient resource development and optimal land use. The main objective of the Utah Relinquishment Provision — Horizontal Well is to encourage operators to responsibly develop their leased areas and prevent non-production or inactive wells from occupying valuable petroleum resources. It ensures that operators consistently explore and exploit the maximum potential of their acreage, reducing waste and maximizing economic benefits. Under the Utah Relinquishment Provision — Horizontal Well guidelines, operators are required to complete specific milestones within a pre-determined timeframe. Failure to achieve these milestones may result in the relinquishment of their leasehold rights. The milestones typically include initial drilling, completion, and production timeframes. Furthermore, the Utah Relinquishment Provision — Horizontal Well includes a provision for the relinquishment of a well pad. Once a horizontal well and its associated facilities are no longer producing or in active operation, the operator must initiate the proper relinquishment process to release the leased land for potential re-lease or other land uses. There are different types of Utah Relinquishment Provision — Horizontal Wells that can be categorized based on their respective locations and geographical characteristics. These types may include: 1. Greenfield Horizontal Well Relinquishment: Refers to the relinquishment of a newly drilled horizontal well on unused land or previously undeveloped areas. 2. Brownfield Horizontal Well Relinquishment: Involves the relinquishment of a horizontal well located on land that was previously developed or utilized for other purposes, such as agricultural or residential use. 3. Proven Reserve Horizontal Well Relinquishment: This type of relinquishment provision is triggered when a horizontal well has exhausted its commercially viable reserves and is no longer economically feasible to operate. The Utah Relinquishment Provision — Horizontal Well aims to ensure responsible and efficient resource development in the state while safeguarding the interests of both operators and the environment. It promotes continuous exploration and exploitation of oil and gas resources, setting a benchmark for other states to optimize their own relinquishment provisions.
