43 CFR § 3137.89 - How does production allocation occur from wells that do not meet the productivity criteria?

---
identifier: "/us/cfr/t43/s3137.89"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "43 CFR § 3137.89 - How does production allocation occur from wells that do not meet the productivity criteria?"
title_number: 43
title_name: "Public Lands: Interior"
section_number: "3137.89"
section_name: "How does production allocation occur from wells that do not meet the productivity criteria?"
chapter_name: "BUREAU OF LAND MANAGEMENT, DEPARTMENT OF THE INTERIOR"
subchapter_number: "C"
subchapter_name: "MINERALS MANAGEMENT (3000)"
part_number: "3130"
part_name: "OIL AND GAS LEASING: NATIONAL PETROLEUM RESERVE, ALASKA"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "42 U.S.C. 6508, 43 U.S.C. 1733 and 1740."
regulatory_source: "46 FR 55497, Nov. 9, 1981, unless otherwise noted."
cfr_part: "3130"
---


# 3137.89 How does production allocation occur from wells that do not meet the productivity criteria?

(a) If a well that does not meet the productivity criteria was drilled before the unit was formed, the production is allocated on a lease or other federally-approved oil and gas agreement basis. You must pay and report the royalties from any such well either as specified in the underlying lease or other federally-approved oil and gas agreements.

(b) If you drilled a well after the unit was formed and the well is completed within an existing participating area, the production becomes a part of that participating area production even if it does not meet the productivity criteria. BLM may require the participating area to be revised under § 3137.84 of this subpart.

(c) If a well not meeting the productivity criteria is outside a participating area, the production is allocated as provided in paragraph (a) of this section.