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353.630 Pooling of oil and gas interests -- Conditions.
(1)
(2)
(3)
(4)
Whenever any separate tract of land is so situated because of size or other
condition that it does not contain a location at which a well for oil or gas may be
drilled, deepened, or reopened by reason of the spacing provisions of KRS
353.610, the department shall order, after notice and a hearing, the pooling of
all oil and gas interests in the separate tract or in a portion thereof with all like
interests in a contiguous tract or tracts, or portions thereof, as are necessary to
afford the pooled tracts one (1) location for the drilling, deepening, or reopening
of a well for the production of oil or gas in compliance with the spacing
requirements of KRS 353.500 to 353.720. The department shall require the
development and operation of all pooled acreage as a single leasehold estate
in accordance with regulations and rules promulgated under KRS 353.500 to
353.720.
Whenever an operator proposes to drill, deepen, or reopen a well at a location
that would require the pooling of separate tracts or interests in order to comply
with the spacing requirements of KRS 353.610, and the operator has secured
the written consent or agreement from the owners of at least fifty-one percent
(51%) of the interests in each tract, or portions thereof, included in the
proposed pooled acreage, the department shall, where it finds that the
requirements of this subsection have been met, order, after notice and a
hearing, the pooling of all oil and gas interests in all tracts, or portions thereof,
that are included within the proposed pooled acreage as established by the
spacing requirements of KRS 353.610. For purposes of this section, any
unknown or nonlocatable owners shall be deemed to have consented or
agreed to the pooling, provided that the operator has complied with the
publication requirements of KRS 353.640(1) with respect to the unknown or
nonlocatable owners. The department shall issue a permit to drill, deepen, or
reopen the well and require the development and operation of the pooled
acreage as a single leasehold estate in accordance with administrative
regulations promulgated under KRS 353.500 to 353.720.
Whenever an operator proposes to drill, deepen, or reopen a well at a location
that would require the pooling of interests or tracts in order to comply with the
spacing requirements of KRS 353.610, and the operator owns or controls the
right to develop the oil and gas underlying one hundred percent (100%) of the
interests in each tract, or portions thereof, included in the proposed pooled
acreage, the department shall, where it finds that the requirements of this
subsection have been met, order, after notice and a hearing, the pooling of all
oil and gas interests in all tracts, or portions thereof, that are included within the
proposed pooled acreage established by the spacing requirements of KRS
353.610. The department shall issue a permit to drill, deepen, or reopen the
well and require the development and operation of all pooled tracts as a single
leasehold estate in accordance with administrative regulations promulgated
under KRS 353.500 to 353.720.
No pooling as permitted by this section shall be ordered except:
(a) When an application has been filed to drill, deepen, or reopen a well
within the distance limitations prescribed in KRS 353.610; and
(b) When a lessee or owner of an oil or gas interest in the tract shall request
(5)
(6)
the pooling.
No pooling as permitted by this section shall be ordered with respect to any
tract or portion thereof upon which a well is drilled, deepened, or reopened:
(a) Unless the pooling was requested prior to the commencement of the
drilling, deepening, or reopening of the well by a lessee or owner of an oil
and gas interest in a contiguous tract pursuant to subsection (1), (2), or
(3) of this section; and
(b) Unless the request, if made by the owner of an operating interest who
elects to participate in the risk and cost of the drilling, deepening, or
reopening of the well, is accompanied by a bond or other security
satisfactory to and in an amount set by the director for the payment of
such owner's share of the cost of drilling, deepening, or reopening the
well.
Production from any well which is ordered pooled pursuant to KRS 353.500 to
353.720 shall be deemed for all purposes to have been so produced from each
tract or portion thereof included in the pool in proportion to the amounts
established in the pooling order.
Effective:June 24, 2003
History: Amended 2003 Ky. Acts ch. 150, sec. 14, effective June 24, 2003. -Amended 2000 Ky. Acts ch. 268, sec. 2, effective July 14, 2000. -- Amended
1986 Ky. Acts ch. 233, sec. 1, effective July 15, 1986. -- Created 1960 Ky. Acts
ch. 103, sec. 15, effective June 16, 1960.
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