Use this template to create a Farmout and Participation Agreement for oil and gas properties in the Province of Alberta. Key provisions of this agreement include:

• If the interest of a party becomes encumbered, such encumbrance will be charged to and paid by that party.
  
• Farmor makes no warranty of title to the farmout lands or the title documents.
  
• Farmee will spud the test well and will drill the same to at least contract depth, lot and test, and either complete, cap or abandon it in accordance with the agreement and the Regulations.
  
• Farmee is responsible for obtaining and maintaining control of well insurance.
  
• Provision for drilling substitute well.
  
• Farmees earned interest in the farmout lands is calculated as 100% of Farmors interest down to earning depth in the lands and title documents that comprise the test well spacing unit, subject to encumbrances, and a specified percentage of the remainder.
  
• Optional clauses for option well election.
  
• Participation of parties making up the Farmor are set out as to share of expenses and percentage of interest.
  
• Operating Procedure to apply.

The agreement contains language for an Option Agreement as well.

This is a Canadian oil and gas document in MS Word format.