THE EFFECTS OF COMPULSORY UNITIZATION UPON LEASE COVENANTS
AbstractRelatively new to Canada, compulsory unitization legislation aims to promote greater recovery of minerals with minimal waste. The author attempts to identify the implications of this compulsory unitization for express or implied covenants under the traditional oil and gas lease. Through an examination of the American experience, the author surveys the potential effects of such legislation on the covenants to market and operate in a prudent manner and to pay royalties, with particular attention paid to covenants such as those to drill the initial well, to reasonably develop, and to protect from drainage.
Keywords:Landlord and Tenant, Mines and Minerals
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