27-672. Unit operations; unit agreements
223 words·~1 min read·
/az/title-27/27-672A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
A. Each lease issued under the provisions of this article shall provide that the lessee, insofar as its interest is affected, may join, with the department's prior written approval, in cooperative or unit plans for the development and operation of geothermal resource pools with the United States, its agencies and its or their lessees and permittees and with private owners and persons holding geothermal resource leases on private lands or on state lands.
B. Upon determination by the department that it is in the best interests of the state to commit state lands to a cooperative or unit plan for the development and operation of geothermal resource pools, the department may, insofar as the state royalties may be affected thereby, join in and consent to any such plan on behalf of the state. The agreements shall provide for the equitable division on an agreed basis of the geothermal resource produced from the unit and for the extension of leases covering any part of the unit so long as geothermal resources in paying quantities are produced from any part of the unit.
No such agreement shall relieve any operator from the obligation to develop reasonably the lands and leases as a whole nor shall such agreement relieve the lessee of the obligation to pay to the department the royalty provided for in the lease.