PROHIBITED PROVISIONS IN OPERATING AGREEMENT

Sec. 102.015. PROHIBITED PROVISIONS IN OPERATING AGREEMENT. A pooling agreement, offer to pool, or pooling order is not considered fair and reasonable if it provides for an operating agreement containing any of the following provisions: (1) preferential right of the operator to purchase mineral interests in the unit; (2) a call on or option to purchase production from the unit; (3) operating charges that include any part of district or central office expense other than reasonable overhead charges; or (4) prohibition against nonoperators questioning the operation of the unit. Acts 1977, 65th Leg., p. 2572, ch. 871, art. I, Sec. 1, eff. Sept. 1, 1977.