Fill and Sign the Article Joint Oil and Gas Operations in Louisiana Form

ACCOUNTING PROCEDURES Form 1. Neither the Operator nor the Non-Operators intend for the Operator to make a profit or to suffer a loss with respect to its service as Operator under this Operating Agreement. All parties expect the Operator to charge the joint account for the actual cash cost of servic es rendered and the material provided for the benefit of the joint account unless otherwise specifical ly provided. The Parties intend for the Operator’s general and administrative expenses, regional or direc t office expenses, and similar types of expenses to be recovered as provided in Section ___ of t his Accounting Procedure governing ‘overhead expenses.’ The parties expressly agree that the overhead provided for in Section ___ of the Accounting Procedure is an estimation of actual costs incurred by the Operator for the benefit of the joint account and shall not be intende d to produce a “profit” for the Operator under any circumstances. Form 2. If any affiliate of Operator is utilized in rendering any services under the terms of thi s Agreement, the services shall be necessary and rendered at commercial rates preva iling in the area consistent with the same standard or quality provided by independent vendors. The rates charged by the affiliate shall be subject to audit as prescribed in the attac hed Accounting Procedure. Form 3. In the event of an audit permitted under the terms of the Accounting Procedure, the auditing party shall have the right to disseminate the audit report to any non-joining Non- Operators without liability, and if any non-joining parties elect the benefits of the audit, they shall pay their proportionate part of the costs of the audit.