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Ohio Laws and Rules
If a tract of land is of insufficient size or shape to meet the requirements for drilling a well thereon as provided in section 1509.24 or 1509.25 of the Revised Code, whichever is applicable, and the owner has been unable to form a drilling unit under agreement as provided in section 1509.26 of the Revised Code, on a just and equitable basis, the owner of such tract may make application to the division of mineral resources management for a mandatory pooling order.
Such application shall include such data and information as shall be reasonably required by the chief of the division of mineral resources management and shall be accompanied by an application for permit as required by section 1509.05 of the Revised Code. The chief shall notify all owners of land within the area proposed to be included within the order of the filing of such application and of their right to a hearing if requested. After the hearing or after the expiration of thirty days from the date notice of application was mailed to such owners, the chief, if satisfied that the application is proper in form and that mandatory pooling is necessary to protect correlative rights or to provide effective development, use, or conservation of oil and gas, shall issue a drilling permit and a mandatory pooling order complying with the requirements for drilling a well as provided in section 1509.24 or 1509.25 of the Revised Code, whichever is applicable, which shall:
(A) Designate the boundaries of the drilling unit within which the well shall be drilled;
(B) Designate the proposed drilling site;
(C) Describe each separately owned tract or part thereof pooled by the order;
(D) Allocate on a surface acreage basis a pro rata portion of the production to the owner of each tract;
(E) Specify the basis upon which each owner shall share all reasonable costs and expenses of drilling and producing;
(F) Designate the person to whom the permit shall be issued.
If an owner does not elect to participate in the risk and cost of the drilling and operation, or operation, of a well, the owner may elect to be a nonparticipating owner in the drilling and operation, or operation, of the well, on a limited or carried basis upon terms and conditions determined by the chief to be just and reasonable. If one or more of the participating owners bear the costs of drilling, equipping, or operating a well for the benefit of a nonparticipating owner, as provided for in the pooling order, then such participating owner or owners shall be entitled to the share of production from the drilling unit accruing to the interest of such nonparticipating owner, exclusive of the royalty interest if the fee holder has leased the fee holder’s land to others, otherwise, one-eighth of the fee holder’s share of the production, until there has been received the share of costs charged to such nonparticipating owner plus such additional percentage of the share of costs as the chief shall determine. The total amount receivable hereunder shall in no event exceed double the share of costs charged to such nonparticipating owner.
If there is a dispute as to costs of drilling, equipping, or operating a well, the chief shall determine such costs.
In instances where a well is completed prior to the pooling of interests in a drilling unit under this section, the sharing of production and adjustment of the original costs of drilling, equipping, and completing the well shall be from the effective date of the mandatory pooling order.
From and after the date of a pooling order, all operation, including the commencement of drilling or the operating of or production from a well upon any tract or portion of the drilling unit, shall be deemed for all purposes the conduct of such operations upon and production from any lease or contract for lands any portion of which is included in the drilling unit.
Effective Date: 06-14-2000