KANSAS STATUTES AND CODES

55-1308. Existing rights, rights in unleased land, and royalties and lease burdens.

55-1308

Chapter 55.--OIL AND GAS Article 13.--UNITIZATION

55-1308. Existing rights, rights in unleased land,and royalties andlease burdens.Property rights, leases, contracts, and other rights or obligationsshall be regarded as amended and modified only to the extent necessary toconform to the provisions and requirements of this act and to any validorder of the commission providing for the unit operation of a pool or apart thereof, but otherwise shall remain in full force and effect. For thepurpose of this act the owner, or owners, of oil and gas rights in andunder an unleased tract of land shall be regarded as a working interestowner to the extent of a 7/8 interest in andto such rightsand a royalty owner to the extent of the remaining1/8interest therein, except that, if the commission finds that, under theprevailing industry practice in the area where the unit is located, oil and gasleases contain a higher amount of royalty than 1/8 royaltyinterest, then the owner or owners shall be regarded as a royalty interestowner to the extent of the royalty interest determined by the commission to bein accordance with prevailing industry practice and a working interest owner astothe remainder of the owner's or owners' interest in such tract ofland.

A 1/8 part of the production allocated to eachtract underan order providing for the unit operation of a pool or a part thereof,shall in all events be and remain free and clear of any cost or expense ofdeveloping or operating the unit and of any lien therefor as anunencumbered source from which to pay the royalties or other cost freeobligations due or payable with respect to the production from such tract.If a lease or other contract pertaining to a tract or interest stipulates aroyalty, overriding royalty, production payment or other obligation inexcess of 1/8 of the production or proceedstherefrom, thentheworking interest owner subject to such excess payment or other obligationshall bear and pay the same.

History: L. 1967, ch. 299, § 8;L. 2000, ch. 15, § 3; Mar. 30.