How soon after I know of the likelihood of drainage must I take protective action?

(a) You must take protective action within a reasonable time after the earlier of: (1) The date you knew or had constructive notice that the potentially draining well had begun to produce oil or gas; or (2) The date we issued a demand letter for protective action. (b) Since the time required to drill and produce a protective well varies according to the location and conditions of the oil and gas reservoir, BLM will determine this on a case-by-case basis. When we determine whether you took protective action within a reasonable time, we will consider several factors including, but not limited to: (1) Time required to evaluate the characteristics and performance of the draining well; (2) Rig availability; (3) Well depth; (4) Required environmental analysis; (5) Special lease stipulations which provide limited time frames in which to drill; and (6) Weather conditions. (c) If BLM determines that you did not take protection action timely, you will owe compensatory royalty for the period of the delay under § 3162.2-12. [66 FR 1894, Jan. 10, 2001]