دیکشنری تخصصی مهندسی نفت - نسخه آنلاین

n: an agreement whereby the owner of a lease who does not wish to drill at the time agrees to assign the leasehold interest, or some part of it, to a third party who does wish to drill, conditional on the third partys drilling a well within the expiration date of the primary term of the lease. The assignment may include the entire interest together with dry hole money, or partial interest or entire interest with or without an override. If an override is retained, the owner of the lease may retain an option to convert such overriding royalty retained to an agreed-upon working interest. A farmout is distinguished from a joint operating agreement by the fact that the partner farming out does not incur any of the drilling costs. The primary characteristic of a farmout is the obligation of the third party to drill one or more wells on the farmout acreage as a condition prerequisite to completion of the transfer of title to such third party.

joint operating agreement.

n: a contract by which two or more co-owners of the operating rights in a tract of land join to share the costs of exploration and possible development. Compare farmout.

a written agreement that sets the terms under which a property will be developed by the working interest owners.

n: a form of joint venture very similar to an oil and gas joint operating agreement. Profits, losses, operations, and ownership are all shared, and the partners are jointly as well as severally (separately) liable.

n: a provision in a joint operating agreement that allows parties who consent to later operations to penalize parties who do not consent. The penalty can be arranged in various ways but, to be effective, it assumes the productiveness of the proposed operation.

n: see joint operating agreement.