Nevada § 522.170 - Contents of Interstate Compact

§ 522.170. Contents of Interstate Compact

The Interstate Compact to Conserve Oil and Gas referred to in NRS 522.160 is as follows: This agreement may become effective within any compacting state at any time as prescribed

by that state, and shall become effective within those states ratifying it whenever

any three of the States of Texas, Oklahoma, California, Kansas and New Mexico have

ratified and Congress has given its consent. Any oil producing state may become a party hereto as hereinafter provided. The purpose of this Compact is to conserve oil and gas by the prevention of physical

waste thereof from any cause. Each state bound hereby agrees that within a reasonable time it will enact laws, or

if laws have been enacted, then it agrees to continue the same in force, to accomplish

within reasonable limits the prevention of: (a) The operation of any oil well with an inefficient gas-oil ratio. (b) The drowning with water of any stratum capable of producing oil or gas, or both

oil and gas in paying quantities. (c) The avoidable escape into the open air or the wasteful burning of gas from a natural

gas well. (d) The creation of unnecessary fire hazards. (e) The drilling, equipping, locating, spacing or operating of a well or wells so

as to bring about physical waste of oil or gas or loss in the ultimate recovery thereof. (f) The inefficient, excessive or improper use of the reservoir energy in producing

any well. The enumeration of the foregoing subjects shall not limit the scope of the authority

of any state. Article IV Each state bound hereby agrees that it will, within a reasonable time, enact statutes,

or if such statutes have been enacted, then it will continue the same in force, providing

in effect that oil produced in violation of its valid oil and/or gas conservation

statutes, or any valid rule, order or regulation promulgated thereunder, shall be

denied access to commerce; and providing for stringent penalties for the waste of

either oil or gas. Article V It is not the purpose of this Compact to authorize the states joining herein to limit

the production of oil or gas for the purpose of stabilizing or fixing the price thereof,

or create or perpetuate monopoly, or to promote regimentation, but is limited to the

purpose of conserving oil and gas and preventing the avoidable waste thereof within

reasonable limitations. Article VI Each state joining herein shall appoint one representative to a commission hereby

constituted and designated as the Interstate Oil Compact Commission, the duty of which

said Commission shall be to make inquiry and ascertain from time to time such methods,

practices, circumstances and conditions as may be disclosed for bringing about conservation

and the prevention of physical waste of oil and gas, and at such intervals as said

Commission deems beneficial it shall report its finding and recommendations to the

several states for adoption or rejection. The Commission shall have power to recommend the coordination of the exercise of the

police powers of the several states within their several jurisdictions to promote

the maximum ultimate recovery from the petroleum reserves of said states, and to recommend

measures for the maximum ultimate recovery of oil and gas. Said Commission shall organize and adopt suitable rules and regulations for the conduct

of its business. No action shall be taken by the Commission except: (1) By the affirmative votes of

the majority of the whole number of the compacting states, represented at any meeting,

and (2) by a concurring vote of a majority in interest of the compacting states at

said meeting, such interest to be determined as follows: Such vote of each state shall

be in the decimal proportion fixed by the ratio of its daily average production during

the preceding calendar half-year to the daily average production of the compacting

states during said period. Article VII No state by joining herein shall become financially obligated to any other state,

nor shall the breach of the terms hereof by any state subject such state to financial

responsibility to the other states joining herein. Article VIII This Compact shall expire September 1, 1937. But any state joining herein may, upon sixty (60) days notice, withdraw herefrom. The representatives of the signatory states have signed this agreement in a single

original, which shall be deposited in the archives of the Department of State of the

United States, and a duly certified copy shall be forwarded to the Governor of each

of the signatory states. This Compact shall become effective when ratified and approved as provided in Article

I. Any oil producing state may become a party hereto by affixing its signature to

a counterpart to be similarly deposited, certified and ratified. Done in the City of Dallas, Texas, this sixteenth day of February, 1935.