Common use of Surface Damages; Fees Clause in Contracts

Surface Damages; Fees. a. Operator shall pay to Company the applicable Surface Damages for the applicable Facilities constructed and/or utilized by Operator pursuant to this Agreement. For the avoidance of doubt, Operator shall not owe any Surface Damages with respect to the Initial Facilities as the same exist on the Effective Date, but shall owe any applicable Surface Damages with respect to the Initial Facilities to the extent the same arise after the Effective Date. Not later than December 31 of each year, Company shall determine, in its reasonable discretion and with reference to market-based surface damages in the approximate vicinity of the applicable Facilities, the applicable Surface Damages for all Leases and Easements that are executed in the immediately succeeding calendar year, and shall provide not to Operator thereof along with reasonable supporting documentation; provided that if Company or its applicable Affiliate has received surface damages from one or more Third Parties in the approximate vicinity of the applicable Facilities within the prior twelve (12) months, the adjusted Surface Damages shall not exceed the highest surface damages paid to Company or its applicable Affiliate by a Third Party in the approximate vicinity of the applicable Facilities within the prior twelve (12) months. If Company does not make this determination and provide notice and the required documentation to Operator thereof in accordance with this Section 2.4(a), the then-current Surface Damages shall continue in effect. Other than any Surface Damages as determined in accordance with this Section 2.4(a) and the fees set forth in Section 2.4(b), Operator will not be obligated to pay any royalties, throughputs, or other fees with respect to Operator’s use of or access to the Lands in accordance with this Agreement.