Common use of Taking in Kind Clause in Contracts

Taking in Kind. Subject to Section 27.1.2 hereof, each Party shall have the right, but not the obligation to take in kind or separately dispose of its proportionate share of all Petroleum Substances produced from the Leased Lands, exclusive of production which may be used in development and producing operations and in the preparation and treatment of production for marketing purposes and production unavoidably lost. Any Party shall have the right, at its sole risk and expense, to construct facilities for taking its share of production in kind, provided that such facilities at the time of installation do not interfere with continuing Operations on the Lease and adequate space is available therefore. Any extra expenditure incurred In the taking in kind or separate disposition by any Party of its proportionate share of production shall be borne by such Party. Notwithstanding the foregoing, and subject to Section 5.6 hereof, Operator agrees to take and sell all Petroleum Substances for the accounts of each Non-Operator unless and until a Non-Operator notifies Operator in writing that it has elected to take its share of Petroleum Substances in kind. For as long as Operator sells a Non-Operator's share of Petroleum Substances, Operator may charge such Non-Operator a fee equal to two cents ($0.02) per mcf (thousand cubic feet) sold for that Non-Operator's account.