Impact of Operating Procedure on Preceding Clause. Notwithstanding the preceding Clause of this Head Agreement: if a Party elects to not participate in an Operation pursuant to Article 9.00 or Article 10.00 of the Operating Procedure for which the consequence of non-participation is the imposition of a cost recovery or production penalty thereunder, the Participating Parties assuming the Non-Participating Party's share of the cost of that Operation shall pay all lessor royalties and, on the basis prescribed by Subclause 10.07F of the Operating Procedure with respect to any cost recovery prescribed by that Subclause, any Encumbrances attributable to the Non-Participating Party's Pooled Interest in respect of production from the well in which the Non-Participating Party elected not to participate until that Non-Participating Party elects to become a Participating Party in that well; and if a Party’s Pooled Interest in the Pooled Lands or a well held hereunder changes because of the application of Clause 10.10 of the Operating Procedure to its election not to participate in a certain well or Article 11.00 or Article 12.00 of the Operating Procedure because of its surrender of certain Pooled Lands or its election to participate in a proposed Abandonment of a well, the Parties that acquire the applicable Pooled Interest in the applicable Pooled Lands or well shall pay all lessor royalties and Encumbrances attributable to that Party’s applicable Pooled Interest.
Impact of Operating Procedure on Preceding Clause. Notwithstanding the preceding Clause of this Head Agreement: If a Party elects not to participate in an Operation, pursuant to Article 9.00 or 10.00 of the Operating Procedure, the Participating Parties assuming the Non-Participating Party`s share of the cost of that Operation will pay all lessor royalties and, on the basis prescribed by Subclause 10.07F of the Operating Procedure with respect to any cost recovery prescribed by that Subclause, Encumbrances attributable to the Non-Participating Party`s Pooled Interest in respect of production from the well in which the Non-Participating Party elected not to participate, until the Non-Participating Party becomes a Participating Party; and If a Party’s Pooled Interest in the Pooled Lands or a well held under this Agreement changes because of the application of Clause 10.10 of the Operating Procedure to its election not to participate in a certain well, or Article 11.00 or Article 12.00 of the Operating Procedure because of its surrender of certain Pooled Lands or its election to participate in a proposed Abandonment of a well, the Parties that acquire the applicable Pooled Interest in the applicable Pooled Lands or well will pay all lessor royalties and Encumbrances attributable to that Party’s applicable Pooled Interest.
