Journal Article

Horizontal-well production allocation in the international context: a reasonable formula for allocation derived from Texas law

David Vandenberg

in The Journal of World Energy Law & Business

Volume 8, issue 3, pages 216-231
Published in print June 2015 | ISSN: 1754-9957
Published online April 2015 | e-ISSN: 1754-9965 | DOI: https://dx.doi.org/10.1093/jwelb/jwv015
Horizontal-well production allocation in the international context: a reasonable formula for allocation derived from Texas law

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Texas law has only recently codified in precedential decisions a reasonable formula for production allocations for horizontal, including fracked, wells. The ancient regime of the Rule of Capture does not generally apply, because of the nature of the geologic deposits and the new technology. This reasonable formula is applicable in the international arena for cross-border deposits and production blocks. Other national law and international treaties provide scant guidance in these matters and governments, national oil companies and international oil companies should review this formula to aid in negotiations for fair and equitable allocations that should preclude unnecessary disputes and litigation.

Journal Article.  6175 words.  Illustrated.

Subjects: Environment and Energy Law

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