55-804. Text of such compact.
55-804
55-804. Text of such compact.Said "interstate compact to conserve oil and gas" so ratified, approved andconfirmed, is in words and figures as follows:
"Article I
"This agreement may become effective within any compacting state at anytime as prescribed by that state, and shall become effective within thosestates ratifying it whenever any three of the states of Texas, Oklahoma,California, Kansas, and New Mexico have ratified and congress has given itsconsent. Any oil-producing state may become a party hereto as hereinafterprovided.
"The purpose of this compact is to conserve oil and gas by theprevention of physical waste thereof from any cause.
"Each state bound hereby agrees that within a reasonable time it willenact laws, or if laws have been enacted, then it agrees to continue thesame 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 orgas, or both oil and gas in paying quantities.
(c) The avoidable escape into the open air or the wasteful burning ofgas from a natural-gas well.
(d) The creation of unnecessary fire hazards.
(e) The drilling, equipping, locating, spacing or operating of a wellor wells so as to bring about physical waste of oil or gas or loss in theultimate recovery thereof.
(f) The inefficient, excessive or improper use of the reservoir energyin producing any well.
"The enumeration of the foregoing subjects shall not limit the scope ofthe authority of any state.
"Each state bound hereby agrees that it will, within a reasonable time,enact statutes, or if such statutes have been enacted then that it willcontinue the same in force, providing in effect that oil produced inviolation of its valid oil and/or gas conservation statutes or any validrule, order or regulation promulgated thereunder, shall be denied access tocommerce; and providing for stringent penalties for the waste of either oilor gas.
"It is not the purpose of this compact to authorize the states joiningherein to limit the production of oil or gas for the purpose ofestablishing or fixing the price thereof, or create or perpetuate monopoly,or to promote regimentation, but is limited to the purpose of conservingoil and gas, preventing the avoidable waste thereof within reasonablelimitations.
"Each state joining herein shall appoint a representative to acommission hereby constituted and designated as The Interstate Oil CompactCommission, the duty of which said commission shall be to make inquiry andascertain from time to time such methods, practices, circumstances andconditions as may be disclosed for bringing about conservation and theprevention of physical waste of oil and gas, and at such intervals as saidcommission deems beneficial it shall report its findings andrecommendations to the several states for adoption or rejection. "The commission shall have power to recommend the co-ordination of theexercise of the police powers of the several states within their severaljurisdictions to promote the maximum ultimate recovery from the petroleumreserves of said states, and to recommend measures for the maximum ultimaterecovery of oil and gas. Said commission shall organize and adopt suitablerules and regulations for the conduct of its business. "No action shall be taken by the commission except: (1) by theaffirmative votes of the majority of the whole number of the compactingstates, represented at any meeting, and (2) by a concurring vote of amajority in interest of the compacting states at said meeting, suchinterest to be determined as follows: Such vote of each state shall be inthe decimal proportion fixed by the ratio of its daily average productionduring the preceding calendar half-year to the daily average production ofthe compacting states during said period. "No state by joining herein shall become financially obligated to anyother state, nor shall the breach of the terms hereof by any state subjectsuch state to financial responsibility to the other states joining herein. "This compact shall expire September 1, 1937. But any state joiningherein may, upon sixty (60) days' notice, withdraw herefrom. "The representatives of the signatory states have signed this agreementin a single original which shall be deposited in the archives of theDepartment of State of the United States, and a duly certified copy shallbe forwarded to the governor of each of the signatory states. "This compact shall become effective when ratified and approved asprovided in article I. Any oil-producing state may become a party hereto byaffixing 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. "The following representatives recommend to their respective governorsand legislatures the ratification of the foregoing agreement. History: L. 1935, ch. 215, § 2; March 20.