Joint Operating Agreements: Gas Balancing

摘要

In December 1992, Castle purchases Arco's interest in several producing leases comprising six gas units in Texas. Castle also succeeds to Arco's position as operator under the joint operating agreements ("JOAs") povernign the operation of the leases. Earh JOA includes a gas balancing agreements ("JOAs ") governing the operation ot the leases Each JOA includes a gas balancing agreement ("GBA") providing generally that a party, when unable to market its gas, should be credited with gas in storage equal to its share of the gas produced. When able to market its share. the underproduced party is entitled to take its share plus twenty-five percent of the overproduced parties' share of gas produced until it has reovered teh gas in storage ("banked gas "). The GBA does not provide for the balancing of condensate production.