Mississippi Code 1972 (2023) › Title 53 - OIL, GAS, AND OTHER MINERALS (§§ 53-1-1 — 53-11-33) › Chapter 3 - DEVELOPMENT, PRODUCTION AND DISTRIBUTION OF GAS AND OIL (§§ 53-3-1 — 53-3-203) › UNITIZATION OF OIL AND GAS FIELDS AND POOLS (§§ 53-3-101 — 53-3-119) › Section 53-3-105 - Provisions and requirements of board's order

The order issued by the State Oil and Gas Board shall be fair and reasonable under all of the circumstances and shall protect the rights of interested parties and shall include:
(a)
A description of the geographical area and a description of the pool or pools, or of any portion or portions or combinations thereof affected which together constitute and are herein termed the "unit area."
(b)
A statement of the nature of the operations contemplated.
(c)
A formula for the allocation among the separately owned tracts in the unit area of all the oil or gas, or both, produced and saved from the unit area, and not required in the conduct of such operation, which formula must expressly be found reasonably to permit persons otherwise entitled to share in or benefit by the production from such separately owned tracts to receive, in lieu thereof, their fair, equitable and reasonable share of the unit production or other benefits thereof. A separately owned tract's fair, equitable and reasonable share of the unit production shall be that proportionate part of unit production that the contributing value of such tract for oil and gas purposes in the unit area and its contributing value to the unit bears to the total of all like values of all tracts in the unit, taking into account all pertinent engineering, geological and operating factors that are reasonably susceptible of determination.
(d)
A provision for adjustment among the owners of the unit area (not including royalty owners) of their respective investment in wells, tanks, pumps, machinery, materials, equipment and other things and services of value attributable to the unit operations. The amount to be charged unit operations for any such item shall be determined by the owners of the unit area (not including royalty owners), but if said owners of the unit area are unable to agree upon the amount of such charges, or to agree upon the correctness thereof, the board shall determine them after due notice and hearing thereon, upon the application of any interested party. The amount charged against the owner of a separately owned tract shall be considered expense of unit operation chargeable against such tract. The adjustments provided for herein may be treated separately and handled by agreements separate from the unitization agreement. The expense of dry holes drilled within the unit area prior to the effective date of an order of the board, as determined by Section
53-3-107
, shall not be chargeable as investment under subsection (c) of Section
53-3-109
, unless such dry hole is used in the unit operation, in which event its value to the unit shall be charged as investment.
(e)
A provision that the costs and expenses of unit operation, including investment past and prospective, shall be borne by the owner or owners (not entitled to share in production free of operating costs and who in the absence of unit operation would be responsible for the expenses of developing and operating) of each tract in the same proportion that such tracts share in unit production. Each owner's interest in the unit area shall be responsible for his proportionate share thereof, and the unit operator shall have a lien thereon to secure payment of such share. When any owner fails to pay his part thereof when due and interest thereon at the legal rate, then all of such owner's interest in the unit production and equipment may be foreclosed in the same manner and under the same procedures provided for the foreclosure of mortgages in chancery court.
A transfer or conversion of any owner's interest or any portion thereof, however accomplished after the effective date of the order creating the unit, shall not relieve the transferred interest of said operator's lien on said interest for the cost and expense of unit operations, past or prospective.
(f)
The designation of, or a provision for the selection of a successor to the unit operator. The conduct of all unit operations by the unit operator, and the selection of a successor to the unit operator, shall be governed by the terms and provisions of the unitization agreements.
(g)
The time the unit operation shall become effective and the manner in which, and the circumstances under which, the unit operation shall terminate.
(h)
A requirement that all oil and/or gas contained in a unit area shall be produced and sold as rapidly as possible without decreasing the ultimate recovery of such oil and/or gas or causing damage to the reservoir.
Codes, 1942, § 6132-103; Laws, 1964, ch. 236, § 3; Laws, 1972, ch. 365, § 3, eff. 4/24/1972.