Alberta Farmout Agreement with Substitute Well Clauses
Buy and download this Farmout Agreement for Alberta oil and gas properties which includes provisions for a substitute well.
- Drilling of Earning Well. The farmee will begin drilling the earning well at its sole cost and risk. The well will be drilled to the contract depth and the farmee will log and test, and either complete, equip or abandon the well in accordance with the agreement.
- Substitute Well. The agreement contains provisions for drilling a substitute well if serious difficulties are encountered and the first well is abandoned.
- Calculation of Earned Interest. The farmee's earned interest in the farmout lands is calculated as undivided 100% of Farmor's interest in the producing zones, undivided 50% of the remainder of the lands.
- Royalty Calculation. The agreement sets out how the farmor's royalty will be calculated on the farmee's interest in crude oil and crude naphtha, natural gas, and all other hydrocarbons.
- Payment of Costs. The farmor is responsible for all charges payable with respect to the farmout lands.
- Governing Law. This Farmout Letter Agreement template is intended to be used only for lands within the Province of Alberta, Canada.
- Format. This is a downloadable legal form which can be modified and re-used. Available as a MS Word document. Other formats available on request.
Last Updated: 24-October-2017