Oklahoma § 52-902 - Construction of oil and gas contracts, statutes and

§ 52-902. Construction of oil and gas contracts, statutes and

governmental orders.

The sanctity of private agreements, and the consistent and

predictable application and interpretation of statutes, governmental

orders and common law, being essential to the oil and gas industry,

the following are declared to be paramount rules of construction to

be applied by the courts of this state in the construction of

private agreements, statutes and governmental orders relating to the

exploration for, operations for, producing of, or marketing oil or

gas, or disbursing proceeds of production of oil or gas:

1. A person is bound as a reasonably prudent operator to

operate the well on behalf of all owners in the well and perform any

duties owed to any person under a private agreement, statute,

governmental order or common law relating to the exploration for,

operations for, producing of, or marketing oil or gas, or disbursing

Oklahoma Statutes - Title 52. Oil and Gas

proceeds of production of oil or gas, and performance of the duties

described herein is that performance which an operator acting

reasonably would have undertaken given the circumstances at the

time, without being required to subordinate its own business

interests, but with due regard to the interests of all affected

parties, including the operator; and

2. There shall not be implied in the duties in paragraph 1 of

this section or otherwise any fiduciary duty, quasi-fiduciary duty

or other similar special relationship in any private agreement,

statute or governmental order or common law relating to the

exploration for, operations for, producing of, or marketing oil or

gas, or disbursing proceeds of production of oil or gas.

Nothing in this section shall either prohibit the parties to a

private agreement from expressly agreeing in writing otherwise or

prohibit the Legislature from expressly providing otherwise in any

statute subsequently enacted or prohibit any governmental order from

expressly providing otherwise to the extent within the power or

authority of the issuer of such order. However, the provisions of

paragraph 2 of this section shall not apply to Sections 287.1

through 287.15 of Title 52 of the Oklahoma Statutes and nothing in

this act shall be interpreted to relieve an operator or owner from

any obligation or duty set forth expressly in the Production Revenue

Standards Act or the Natural Gas Market Sharing Act; provided the

performance of such obligations or duties shall be subject to the

same reasonably prudent operator standard set forth in paragraph 1

of this section.

Added by Laws 2012, c. 201, § 2, emerg. eff. May 8, 2012.