A. Under the conditions contained in this section, the Corporation Commission is authorized to allow multiunit horizontal wells in any targeted reservoir or in more than one targeted reservoir, or in a targeted reservoir and an adjacent common source of supply, upon an appropriate finding by the Commission of the necessity to comingle production from more than one targeted reservoir or an adjacent common source of supply in such multiunit horizontal well, in order to prevent waste and protect the correlative rights of the owners of oil and gas rights.
B. Ownership, Allocation of Costs, Commingled Production, and Proceeds.
The Commission shall require the allocation of the reasonable drilling, completion and production costs associated with such multiunit horizontal well to each of the affected units which the well actually penetrates within the completion interval and shall further require the allocation to each of the units affected by a multiunit horizontal well of the commingled production, and the proceeds from the sale thereof, from the completion interval of such multiunit horizontal well, with any allocation to be in a manner that will prevent waste and protect the correlative rights of the owners of the oil and gas rights in each of the affected units which the well actually penetrates within the completion interval.
1. The allocation factor for each affected unit shall be determined by dividing the length of the completion interval located within the affected unit by the entire length of the completion interval in the subject multiunit horizontal well. The Commission shall have the authority to adjust the allocation factors, based upon reasonable testimony and evidence presented to the Commission, if necessary to prevent waste and adequately protect the correlative rights of the owners of the oil and gas rights in each of the affected units.
2. Each party who participates as a working interest owner in a multiunit horizontal well shall own an undivided interest in all portions of the wellbore of the well and in the equipment on or in the well in the same ratio that the party's allocated portion of the total costs of the well and equipment bears to the total costs of the well and equipment. The ownership of undivided interest described in this paragraph shall not affect or prejudice the ownership of oil and gas rights of the affected owners outside of the targeted reservoir for the multiunit horizontal well.
3. A multiunit horizontal well shall be treated as a well in each of the affected units and shall be subject to all of the rules otherwise applicable to any other well in any of the affected units. In allowing a multiunit horizontal well, the Commission, under Section 87.1 of this title, may grant any necessary exceptions to the permitted well location tolerances in each of the affected units for the well and permit the well as an additional well in each of the affected units. When an owner has drilled or proposes to drill a multiunit horizontal well or wells and the owners of a present right to drill in any of the affected units have not agreed to pool their interests in the unit or units for the targeted reservoir, the Commission, under Section 87.1 of this title, may, upon the filing of a proper application therefor, require the owners to pool their interests in the targeted reservoir in each affected unit on a unitwide basis as to the respective unit in regard to the development involving the portion of the multiunit horizontal well or wells located within the affected unit. Furthermore, if the Commission has previously entered an order pooling the interests of owners in an affected unit in which a multiunit horizontal well or wells have been drilled or are proposed to be drilled, the Commission, under Section 87.1 of this title may, upon the filing of a proper application therefor, amend the pooling order to the extent necessary to have the pooling order cover the development involving the portion of the multiunit horizontal well or wells located within the affected unit.
4. The application shall include:
5. Production from the completion interval in the targeted reservoir from each of the affected units in which a multiunit horizontal well is completed may be commingled in the wellbore of the well and produced to the surface. The commingled production from a multiunit horizontal well shall be allocated to each of the affected units based upon the allocation factors approved by the Commission.
6. In granting an application for a multiunit horizontal well or wells, the Commission shall find, based on the testimony and evidence presented, that given the information and knowledge then available, the proposed multiunit horizontal well or wells will prevent waste, protect correlative rights and likely will aid in the full and efficient development of each of the affected units.
7. The wellbore royalty proceeds for a multiunit horizontal well shall be allocated to each affected unit by multiplying the royalty contribution factor of the unit by the wellbore royalty proceeds, with the resulting product being the royalty proceeds for that unit. Each royalty interest owner in an affected unit shall be entitled to receive the owner's proportionate royalty share of the allocated royalty proceeds for that unit.
8. The multiunit horizontal well shall be subject to the provisions of the Product Revenue Standards Act (PRSA). The operator of the multiunit horizontal well shall be the designated royalty distributor pursuant to the PRSA for the multiunit horizontal well, unless there is a diversity of operators in the affected units from which the multiunit horizontal well is producing and another operator in each of the affected units agrees to perform separately the PRSA royalty distribution functions for the unit.
C. Application, Notice and Retained Jurisdiction.
Application for approval of a multiunit horizontal well shall be in a form prescribed by the Commission. The application, and the notice of hearing on the application, shall be served no less than fifteen (15) days prior to the date of the hearing, by regular mail, upon each person or governmental entity having the right to share in production from each of the affected units covered by the application, as well as other persons or governmental entities required by the rules of the Commission. Upon approval of a multiunit horizontal well, the Commission shall retain jurisdiction over the well. The retained jurisdiction of the Commission set forth herein shall neither preclude nor impair the right of any affected party to obtain through the district courts of this state any remedy or relief available at law or in equity for injuries caused by any action or inaction of the applicant, operator or any other affected party.
Added by Laws 2011, c. 54, § 4, emerg. eff. April 13, 2011. Amended by Laws 2014, c. 400, § 2, emerg. eff. June 3, 2014; Laws 2017, c. 372, § 5.
Structure Oklahoma Statutes
§52-1. Corporation Commission or Commission defined.
§52-1.1. Corporations for producing, transmitting or transporting natural gas.
§52-2. Foreign gas pipeline corporations - License.
§52-4. Right-of-way must be granted by charter and damages paid - Damages.
§52-5.1. Cooperation with other agencies.
§52-5.2. Deposit of monies collected in Corporation Commission Revolving Fund.
§52-7. Necessity of incorporation.
§52-8. Plat and information showing trunk lines - Filing with Corporation Commission.
§52-9. Domestic pipeline companies - Erection of pumping stations.
§52-10. Pipeline companies may cross highways, bridges, etc. - Supplying gas to landowner.
§52-21. Businesses and persons subject to act - Vested rights excepted.
§52-22. Pipeline right-of-way - Eminent domain - Highways.
§52-23. Pipeline operators common purchasers - Requirements - Exemptions.
§52-24. Pipeline companies declared common carriers - Discrimination - Exemptions.
§52-24.1. Refusal to purchase or transport natural gas - Complaint - Hearing - Orders.
§52-24.5. Discriminatory fees – Open access – Commission authority.
§52-25. Parties not complying with act not to own gas wells, etc.
§52-27. Right-of-way - Highways - Eminent domain - Foreign corporations - Negligent injuries.
§52-28. Filing records or plats with Corporation Commission - Extension of time.
§52-29. Production levels of gas wells - Rulemaking - Hardship wells - Field rules.
§52-31. Violation of act - Punishment.
§52-32. Violations - Receivership - procedure.
§52-33. Evidence - Certified transcripts of reports of gas companies.
§52-34. Enforcement by Corporation Commission - Appeals.
§52-36.2. Public interest and welfare.
§52-36.4. Certificate of Commission.
§52-36.5. Petition to district court - Examination and determination - Subsequent proceedings.
§52-41. Gas from interstate pipelines - License from Corporation Commission.
§52-44. Gas to be furnished through meters at meter rates - Exceptions.
§52-45. Violations of act misdemeanor - Punishment.
§52-46.1. Ammonia - Commercial fertilizers - Transportation by pipeline.
§52-46.2. Hearing and determination of applications - Appeals.
§52-46.4. Rules and regulations.
§52-47.3. Powers and duties of Commission.
§52-47.4. Inspection, operation and maintenance plan.
§52-47.5. Determination of hazardous transportation system - Corrective action - Emergencies.
§52-47.6. Violations - Penalties.
§52-47.7. Action to redress or restrain violation.
§52-51. Oil companies must comply with statute - "Petroleum" defined.
§52-54. Common purchasers of oil - Required to purchase - Discrimination prohibited.
§52-55. Chapter inapplicable to businesses not of public consequence.
§52-56. Oil carriers are common carriers - Discrimination prohibited.
§52-57. Oil carriers not to be interested in producing.
§52-58. Acceptance of laws and plats to be filed.
§52-59. Domestic pipeline companies have right-of-way.
§52-60. Eminent domain extended to oil pipelines same as railroads.
§52-61. Eminent domain, who may have - Foreign corporations.
§52-62. Commission may extend time for filing plats.
§52-63. Penalty for violations.
§52-64. Suspension of penalty, when.
§52-65. Certified transcript shall be evidence.
§52-86.2. Waste in production of oil - industrial use of water produced
§52-86.4. Common source of supply - Orders, rules and regulations.
§52-86.5. Procedural requirements.
§52-86.6. Short title - Oil and Gas Produced Water and Waste Recycling and Reuse Act.
§52-86.8. Compliance with the Oklahoma Brine Development Act.
§52-87.1. Common source of supply of oil - Well spacing and drilling units.
§52-87.3. Application or petition for location exception - Notice of hearing.
§52-87.4. Affidavit of election for drilling well under pooling order.
§52-87.5. Applications for approval of increased density wells – Notice and hearing.
§52-87.6. Short title - Extended Horizontal Well Development Act - Definitions.
§52-87.7. Corporation Commission jurisdiction.
§52-87.9. Horizontal well unitization for targeted reservoirs.
§52-91. Meters on pipelines - Commission to designate type - Inspection - Cost of operation.
§52-92. Reports - Oil purchased or transported - Forms - Verification.
§52-93. Operators - Books - Oil produced and sold.
§52-94. Maps and drawings - Location of pipelines and connections - Verification.
§52-95. Reports - Quantity of oil produced and moved - Penalty.
§52-96. Verification of reports, statements, maps and drawings.
§52-97. Commission - Jurisdiction to make orders, rules and regulations - Hearings.
§52-98. Powers of Commission - Marshal of Commission.
§52-99. Filing of papers and documents - Use as evidence.
§52-100. Witnesses - Depositions.
§52-101. Procedure - Rules of - Enforcement of orders and rules.
§52-102. Contempt - Punishment - Enforcement of fines - Disposition of fines and penalties.
§52-103. Contempt - Proceedings - How commenced - Complaint - Citation.
§52-104. Right of entry and inspection by conservation officer, his assistants and deputies.
§52-106. Notice on filing of motion or petition.
§52-107. Process - Service - How made - Return.
§52-108. Oaths - Felony of perjury.
§52-109. False verification of documents as perjury - Punishment.
§52-111. Collateral attack on orders, rules and regulations - Appeals - Supreme Court.
§52-112. Application to amend or modify orders - Hearing - Appeal.
§52-113. Appeals - Power of Supreme Court - Supersedeas - Bond.
§52-114. Obstructing or delaying performance of duties a felony.
§52-115. Conspiracy to violate act - Punishment.
§52-116. Violation of orders, rules and regulations - Injunction - Appeal - Supersedeas.
§52-117. Bribery - Punishment.
§52-118. Bribery - Accepting bribe - Punishment.
§52-119. Bribery - State's evidence - Immunity.
§52-120. Powers - Grant of not to restrict general powers.
§52-132. Office of Management and Enterprise Services - Rooms and supplies.
§52-134. Partial invalidity - Effect.
§52-135. Pending actions not terminated.
§52-136. Application of procedural requirements - Right of appeal - Rules and regulations.
§52-138. Partial invalidity, effect of.
§52-140. Earthen storage ponds - Remedial action.
§52-142. Cooperation and assistance of other environmental agencies.
§52-144. Provisions supplemental - Exceptions.
§52-146. Right of condemnation by eminent domain to enforce Commission orders.
§52-147. Institution of condemnation proceedings by lessees.
§52-149. Conservation Division - Creation - Personnel - Duties - Qualifications.
§52-149.1. Oil and gas referees.
§52-149.2. Oil and Gas Appellate Referees.
§52-149.3. Teleconference hearings.
§52-152. Salaries, costs and expenses - Payment.
§52-153. Persons having authority to make investigations, serve orders, etc.
§52-202. Interstate compacts - When binding.
§52-203. Interstate Compact ratified and confirmed.
§52-204. Terms and provisions of compact.
§52-206. Clerical, technical and legal assistants - Expenses - Office.
§52-207. Interstate Oil Compact Fund - Purpose for which used - Disposition of unexpended balance.
§52-208. Duration of Act - Withdrawal from Compact - Credit of funds to General Revenue Fund.
§52-211. Further extensions - Withdrawal from Compact - Determination and necessary steps.
§52-233. Sale of gas - Prices and amounts of gas to be taken - Delivery.
§52-234. Misappropriation of gas - Liability for damages and penalties.
§52-235. Misappropriation of gas - Felony of grand larceny.
§52-239. Common source of supply - Apportionment and regulation to prevent waste.
§52-240. "Common purchaser" - Discrimination in purchases prohibited - Regulation of purchases.
§52-241. Enforcement of act - Hearings before Corporation Commission.
§52-242. Appeals to Supreme Court.
§52-243. Corporation Commission - Authority to make rules and regulations.
§52-244. Pipeline companies - Acceptance of act as prerequisite to right to operate.
§52-245. Mine Inspector - Duties unchanged.
§52-246. Partial invalidity - Effect.
§52-247. Violation - Penalties.
§52-248. Declaration of policy.
§52-250. Natural gas - Pumping of water for irrigation - Preferred use.
§52-251. Prices, terms and conditions - Determination.
§52-253. Initiation of proceedings.
§52-254. Obligation of well operators.
§52-255. Controversies pending.
§52-257. Order granting emergency relief.
§52-272. Production and sale regulated - Corporation Commission, authority of.
§52-273. Waste defined - Regulations to prevent.
§52-275. Wells gauged - Regulation by Corporation Commission - Agents.
§52-276. Enforcement of act - Hearings before Corporation Commission.
§52-277. Appeals to Supreme Court - Effect on orders.
§52-278. Violation - Penalties.
§52-287.1. Legislative finding.
§52-287.2. Power and authority of Commission.
§52-287.3. Matters to be found by Corporation Commission - Requisites of petition.
§52-287.4. Order - Units and unit areas - Plan of unitization.
§52-287.5. Ratification or approval of plan by lessees and owners.
§52-287.6. Procedure - Notice - Appeals.
§52-287.7. Unlawful operation.
§52-287.8. Status and powers of unit - Liability for expenses - Liens.
§52-287.10. Enlargement of area - Creation of new units - Amendment of plan.
§52-287.11. Participation by public lands.
§52-287.12. Receipts as income.
§52-287.15. Agreements not violative of laws governing monopolies or restraint of trade.
§52-288.3. Oklahoma Energy Resources Board.
§52-288.5. Board - Powers, duties and responsibilities.
§52-288.5A. Committee for Sustaining Oklahoma's Energy Resources.
§52-288.5B. Sustaining Oklahoma's Energy Resources Revolving Fund.
§52-288.5D. Levying fee to fund Commission.
§52-288.5E. Refund of fees levied on production.
§52-288.7. Energy Resources Revolving Fund.
§52-288.8A. Levy of assessment - Remitting - Rate - Collection.
§52-288.11. Investment of funds - Utilizing funds to influence governmental action or policy.
§52-291. Confinement of gas until used.
§52-292. Waste from gas pipeline - Unlawful if unnecessary.
§52-293. Flambeau lights unlawful.
§52-294. Lights - Daytime use prohibited.
§52-295. Burning gas during day.
§52-296. Refuse from wells - Disposition.
§52-296.1. Securing of crude oil storage tanks.
§52-302. Firing oil or gas, or interfering with appliances unlawful.
§52-303. Penalty for violations.
§52-305. Well drilling within 100 feet of underground coal mines prohibited.
§52-306. Workable coal beds or seams defined.
§52-307. Drilling of wells through workable seams - Regulations.
§52-309. Findings and declarations.
§52-310. Leaking wells - Entry upon land to plug, replug or repair - Emergencies.
§52-311. Liability for damages.
§52-312. Responsibility for future remedial work.
§52-313. No admission of liability or discharge of action.
§52-314. Right of action for costs involved - Lien
§52-317.1. Seeping natural gas - Jurisdiction, power, and authority of the Corporation Commission.
§52-318. Remedial work - Contracts upon competitive bids.
§52-318.1a. Confidentiality of financial statement.
§52-318.3. Notice of intent to drill - Negotiating surface damages.
§52-318.4. Undertakings which may be posted as damage deposit.
§52-318.5. Negotiating surface damages - Appraisers - Report and exceptions thereto - Jury trial.
§52-318.8. Effect of act on jurisdiction, authority and power of Corporation Commission.
§52-318.9. Violation of act - Damages.
§52-318.21. Short title - Seismic Exploration Regulation Act - Definitions.
§52-318.22. Seismic exploration operations - Registration - Permits - Requirements - Penalty.
§52-318.23. Seismic test hole blasting - Damages.
§52-320. "Growing crops" defined.
§52-320.1. Restriction on location of habitable structures.
§52-320.2. Unlawful use of safety equipment in oil or gas production.
§52-391. Sale of petroleum products under deception as to quality or identity.
§52-392. Marked containers or distributing equipment - Use in selling petroleum products.
§52-393. Trademark - Imitation.
§52-394. Selling under false mark or name.
§52-396. Aiding violations of act.
§52-397. Violation of provisions - Misdemeanor.
§52-398. Definitions - Persons liable for violations by firm or corporation.
§52-399. Partial invalidity - Effect.
§52-420.1. Short title - Definitions.
§52-420.2. State Liquefied Petroleum Gas Administrator - Deputies and enforcement officers.
§52-420.3. Oklahoma Liquefied Petroleum Gas Board.
§52-420.3A. Liability of sellers, suppliers, handlers, or transporters of liquified petroleum gas.
§52-420.4. Registration permits - Fees - Insurance requirements.
§52-420.8. Violations of law or rule.
§52-420.10. Appointment of administrative staff.
§52-420.14. Nonresidents - Prohibition on storage or dispensing.
§52-420.15. Safety schools for liquefied petroleum dealers.
§52-420.17. Inspectors' uniforms - Maintenance and cleaning allowance.
§52-420.22. Oklahoma Liquefied Petroleum Gas Research, Marketing and Safety Commission - Creation.
§52-420.24. Commission powers and duties.
§52-420.25. Commission meetings - Appointment of Director.
§52-420.26. LP Gas Research, Marketing and Safety Revolving Fund.
§52-420.28. Assessment collection - Penalties.
§52-420.29. Assessment refund.
§52-420.29-1. Exports exempted from assessment.
§52-420.29-2. Application for refund by purchaser.
§52-420.29-3. Petition to Commission for refund.
§52-420.30. Certain programs not preempted - Designation of funds for payment of certain programs.
§52-420.31. Oklahoma Propane Education and Safety Council – Powers and duties.
§52-421.1. Liquefied petroleum gas emergency - Declaration by Governor.
§52-472. Terms defined - Pressure - Conversion to standard conditions.
§52-473. Determination of factors by Commission - Determination and report of volumes.
§52-474. Sales, purchases and deliveries - Adjustment of contract prices.
§52-475. Penalty for violations - Civil actions.
§52-477. Jurisdiction of Commission not restricted.
§52-521. Leasing of mineral interests of owners who cannot be located.
§52-523. Negotiations by receiver - Deposit of funds - Discharge - Costs.
§52-524. Natural gas - Preferred use.
§52-525. Agricultural use of natural gas - Price - Installation of lines - Cessation of delivery.
§52-527. Method of measuring amount of gas.
§52-528. State Corporation Commission - Powers and duties - Duty of Operators.
§52-529. Liability of operators - Jurisdiction - Venue.
§52-549.4. Perfection of oil and gas lien.
§52-549.5. Oil and gas commingling.
§52-549.6. Rights of purchaser.
§52-549.7. Relative priority of oil and gas lien.
§52-549.8. Not affected by act.
§52-549.9. Waiver, relinquishment, release.
§52-549.10. Expiration of oil and gas lien - Enforcement of lien.
§52-549.11. Rights of operator.
§52-549.12. Cumulative rights.
§52-553. Mineral Owner's Fund.
§52-554. Transmission of funds - Escrow report - Claims against Mineral Owner's Fund.
§52-555. Investment of funds - Apportionment of interest.
§52-556. Custody of Mineral Owner's Fund - Transfer of monies to Unclaimed Property Fund.
§52-557. Conditions for oil well plugging approval.
§52-558. Implementation of act – Rules - Prospective operation.
§52-570.3. Application of act.
§52-570.5. Designation of person for certain royalty, accounting and remittance functions.
§52-570.6. Selling royalty gas in kind - Consumption and accounting for royalty gas.
§52-570.7. Out-of-balance wells.
§52-570.10. Payment of proceeds from sale of oil and gas production.
§52-570.13. Promulgation of rules.
§52-570.15. Performance pursuant to act - Satisfaction of duties and obligation.
§52-581.2. Purpose and intent of act.
§52-581.4. Exemptions - Owners ineligible to elect to market share.
§52-581.5. Election to market share - Procedure.
§52-581.6. Election to market share - Effect.
§52-581.7. Amount of gas produced from well.
§52-581.8. Distribution of revenues from sale of production.
§52-581.9. Construction and application of act.
§52-604. Transfers prohibited.
§52-609. Powers and authority of Commission.
§52-610. Violations - Fines and penalties - Collection of fines.
§52-612. Nonresident transferees - Service of process.
§52-613. Statute of limitations.
§52-801. Exploration Rights Act of 2011.
§52-803. Surface estate – Interference with solar energy agreement – Notice
§52-902. Construction of oil and gas contracts, statutes and governmental orders.
§52-903. Failure to pay proceeds from production - Remedies.