[Code of Federal Regulations]
[Title 43, Volume 2]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 43CFR3162.2-11]

[Page 419]
 
                    TITLE 43--PUBLIC LANDS: INTERIOR
 
    CHAPTER II--BUREAU OF LAND MANAGEMENT, DEPARTMENT OF THE INTERIOR
 
PART 3160--ONSHORE OIL AND GAS OPERATIONS--Table of Contents
 
  Subpart 3162--Requirements for Operating Rights Owners and Operators
 
Sec. 3162.2-11  How soon after I know of the likelihood of drainage must I take protective action?

    (a) You must take protective action within a reasonable time after 
the earlier of:
    (1) The date you knew or had constructive notice that the 
potentially draining well had begun to produce oil or gas; or
    (2) The date we issued a demand letter for protective action.
    (b) Since the time required to drill and produce a protective well 
varies according to the location and conditions of the oil and gas 
reservoir, BLM will determine this on a case-by-case basis. When we 
determine whether you took protective action within a reasonable time, 
we will consider several factors including, but not limited to:
    (1) Time required to evaluate the characteristics and performance of 
the draining well;
    (2) Rig availability;
    (3) Well depth;
    (4) Required environmental analysis;
    (5) Special lease stipulations which provide limited time frames in 
which to drill; and
    (6) Weather conditions.
    (c) If BLM determines that you did not take protection action 
timely, you will owe compensatory royalty for the period of the delay 
under Sec. 3162.2-12.

[66 FR 1894, Jan. 10, 2001]