Common use of INVENTORIES OF CONTROLLABLE MATERIAL Clause in Contracts

INVENTORIES OF CONTROLLABLE MATERIAL. The Operator shall maintain records of Controllable Material charged to the Well Account, with sufficient detail to perform physical inventories. Adjustments to the Well Account by the Operator resulting from a physical inventory of Controllable Material shall be made within twelve (12) months following the taking of the inventory or Owner’s receipt of the inventory report. Charges and credits for overages or shortages will be valued for the Well Account in accordance with Section IV.2 (Transfers) and shall be based on the Condition “B” prices in effect on the date of physical inventory unless the inventorying Parties can provide sufficient evidence another Material condition applies.