SECTION 165:10-13-9. Allowable for increased density well

(a)   Allowable production. Except as otherwise provided by rule or order of the Commission, the allowable production for permitted wells within a drilling and spacing unit producing from the same common source(s) of supply shall be determined as follows:

(1)   Each individual well shall be classified for allowable purposes by gas-oil ratio under 165:10-13-2.

(2)   Permitted wells of the same classification for allowable purposes shall share a single well allowable.

(3)   Permitted wells of different classifications for allowable purposes shall receive allowables as provided by the order of the Commission authorizing the additional well(s).

(b)   Shared single allowable. If two or more wells in a single drilling and spacing unit are classified as gas wells for allowable purposes, the shared single allowable for the unit shall be determined by the greater of:

(1)   A minimum allowable; or

(2)   A normal allowable based on the wellhead absolute open flow potential of the best well in the drilling and spacing unit producing from the same common source of supply.

(c)   Additional well. If an additional well is not of the same classification as any prior permitted well, it shall receive an allowable as provided by the order permitting the well.

(d)   Effect of penalties. If the allowable for a well in a drilling and spacing unit is subject to a percentage penalty or lid on production, the penalty or lid on production shall apply to the ratable share of production of the shared single allowable for the penalized well as opposed to the entire shared single allowable for the unit.

(1)   The ratable share of production of the shared single allowable for an unallocated gas well is that volume of gas which bears the same ratio to the shared single allowable as the wellhead absolute open flow potential for the well bears to the sum of the wellhead absolute open flow potentials for all wells in the drilling and spacing unit of the same classification for allowable purposes.

(2)   The ratable share of production of the shared single allowable for a special allocated gas well is that volume of gas which bears the same ratio to the shared single allowable as the unpenalized monthly allowable the well would receive if it were the only well in the unit bears to the sum of such allowables for all the wells in the drilling and spacing unit of the same classification for allowable purposes.

(3)   No special allocated well shall receive an allowable less than the defined minimum unit allowable divided by the number of wells in the drilling and spacing unit of the same classification for allowable purposes.

(4)   The ratable share of production of the shared single allowable for an oil well is that volume of oil which bears the same ratio to the shared single allowable as the potential for the well bears to the sum of the potentials for all wells in the drilling and spacing unit of the same classification for allowable purposes. If the oil well was assigned a separate allowable under (c) of this Section, the penalty shall apply to the allowable assigned to the well.

(5)   The portion of the shared single allowable representing the reduction in the allowable for the penalized well is not allocable to other wells in the drilling and spacing unit.

(e)   Which operator shall file required tests. If the operators of the wells in a drilling and spacing unit cannot agree as to which operator shall file the required tests and production reports for the unit or as to what proportion of a shared single allowable shall be attributable to each well of the same classification for allowable purposes, the Commission may, after application, notice, and hearing, issue an order determining which operator shall file the tests and reports or what the proportional share of the shared single allowable is attributable to each well or the maximum rate of allowable production for each well.

(f)   Wellhead absolute open flow potential. For the purpose of this Section, the wellhead absolute open flow potential for a test exempt gas well shall be presumed to equal:

(1)   The average daily production for the previous calendar year (or that portion of the previous calendar year if the first sales date was after January 1 of that year), or the minimum allowable that would otherwise be assigned to an unallocated gas well under applicable rules of the Commission as if such well were the only well in the unit, whichever is less, for an unallocated well; or

(2)   The product of two multiplied by the monthly allowable for the well under 165:10-17-9 for a special allocated well.

(g)   Testing or reporting requirements. This Section shall not exempt any well from any testing or reporting requirement imposed by rule or order of the Commission.

[Source: Amended at 9 Ok Reg 2337, eff 6-25-92; Amended at 16 Ok Reg 2206, eff 7-1-99]