Nature of the Case
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Facts
In 1971 and 1972, D established oil and gas drilling units for large areas of the state. It made each 640-acre geographical section a drilling unit and authorized the drilling of only one well on each unit. P is the owner of an unleased mineral interest which was included in one of the drilling units established in 1971. By issuing the 1971 order, D fixed the location of the unit well and precluded P from drilling his own wells. Under a communitication agreement, all of the owners of working interests in the drilling unit except P voluntarily pooled their interests pursuant to Utah Code Ann. § 40-6-6(5) (then codified at § 40-6-6(f)). The well was completed as a producing well on July 7, 1974. P filed a petition requesting that the Board order the interests in the unit pooled pursuant to its statutory power under section 40-6-6(5) (then codified at § 40-6-6(f)). P entered the order on April 30, 1981, retroactively effective July 26, 1979. The order accounted for and applied only to the first well, providing that once the well reached payout, P was to receive a share of production upon payment of a share of the monthly operating costs. The order made no finding concerning the sharing of costs between consenting and nonconsenting owners. In April 1985, D permitted an additional well on the subject drilling unit. In 1986, ANR Production Company (ANR) became the operator of the first well. On February 6, 1990, ANR commenced drilling the second well. P was given the opportunity to participate in the drilling of the second well, but he refused. On April 10, 1990, ANR requested that D either enter a new order or modify the 1981 order to lay out the costs P would be required to pay and the revenues he would be entitled to receive as a result of the second well. D entered an order modifying the 1981 order. It allows P to receive a royalty from the time of first production. Before he can receive a working interest share of production, it requires P to pay his share of 100 percent of the costs of surface equipment beyond the wellhead, 100 percent of the operating costs, and 175 percent of the costs of drilling, completing, and equipping the well. P appealed claiming the imposition of a statutory nonconsent penalty was an unconstitutional taking and against public interest.
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