CHAPTER 19 FORMULATING A FEDERAL SECONDARY UNIT AGREEMENT

JurisdictionUnited States
Federal Onshore Oil & Gas Pooling & Unitization - part 2
(Oct 2014)

CHAPTER 19
FORMULATING A FEDERAL SECONDARY UNIT AGREEMENT

[Page 242]

BUREAU OF LAND MANAGEMENT RESERVOIR MANAGEMENT AND OPERATIONS SECTION

SECONDARY UNIT

Suggested Procedures for Formulating a Federal Secondary Recovery Unit Agreement

Address application and Unit Agreement papers to the Chief, Reservoir Management and Operations Section. Review and processing of the proposal will be facilitated if the following suggestions are observed:

A. APPLICATION FOR DESIGNATION OF UNIT AREA FOR SECONDARY RECOVERY OPERATIONS. (One copy only.)

The request should consist of an application letter accompanied by a supporting engineering and geologic report.

1. Application Letter.

a. Set out the benefits to be derived by the proposed operations.
b. Set forth the proposed basis for allocating unitized production (formula).
c. Describe the proposed unit area by reference to a land ownership map (Exhibit A of the proposed unit agreement may be used). A legal description of all lands in the proposed unit area may also be included. The map and description should show any odd-sized lots and sections and surveyed tracts and the exact acreage in each. Lands being unitized should be divided into separate tracts for participation purposes on the basis of mineral ownership.
d. List the serial number of all Federal leases, lease applications, and Indian leases on the land ownership map in sequence (grouped by Land Office identities).
e. State whether engineering and geological data and discussions are to be held confidential.

2. Engineering and Geologic Report.

a. The engineering and geological report should be designed to support the application for designation of a unit area and the proposed participation formula.

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b. Include a brief history of the field. Mention any unique features relating to the development of the field.

c. Tabulate production by tracts, showing the annual production from each tract since discovery and the monthly production from each tract during the 24 months immediately preceding the date of the application.
d. Include copies of all logs, core analysis, and other supporting well data. Provide a table which indicates the reservoir top, reservoir base, reservoir thickness, and average porosity, water saturation, net pay, hydrocarbon pore volume, and fluid contacts (gas/oil/water) for the reservoir in each well. Define the criteria used in
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