Common Contracts
1 similar Unitization Agreement contracts
INTRODUCTIONUnitization Agreement • December 16th, 2023
Hydrocarbon tends to tread two or more license concessions areas or even international boundaries. Unitization is a mechanism whereby reservoirs for petroleum and or gas are developed as a unit by a single operator (the Unit Operator) and use common production facilities under an agreement called a Unitization Agreement. The objective is to obtain the maximum recovery of hydrocarbon by the parties. Unitization requires rather complete and real knowledge of the field which justifies there being a Unitization Agreement which is among interested parties. The Unitization Agreement seeks to provide for that the participating interests in an equitable manner and avoid transit impact on the participating interests and helps to avoid some legal traps. Unitization should be implemented early in the life of a field, prior to development as the owners seek to establish leverage in negotiating a larger share of the field or drain the field.
