(dissenting).
I do not agree with the majority opinion and do not feel that such opinion accurately states all of the facts and issues involved or the law applicable thereto. I therefore feel impelled to present my view of the case.
The expensive plant referred to in the majority opinion is more than just a gasoline plant and contains equipment for processing gas, separating and stabilizing *666crude oil and furnishing gas under pressure for cycling and pressure maintenance programs in order to increase the ultimate recovery of gas and oil throughout the entire field.
In the operation of the Unit and the plant, all production from the various producing wells on the leases included in the Unit area is piped directly to the plant. At the plant, the gas and oil are separated and the oil is then sold. The gas, which is a wet gas, is then processed through the equipment in the plant which extracts from this gas the liquid hydrocarbons, that is, gasoline, butane and propane, and these liquid hydrocarbons are then sold. The dry gas remaining after the extraction of these liquid hydrocarbons, is then compressed and injected back into the reservoir as a part of the re-cycling and pressure maintenance program for the operation of the field in order to increase the ultimate recovery of gas and oil.
The only proposition of error presented by appellant is that the Corporation Commission has misconstrued the Plan of Unit-ization and the Statute in allowing overriding royalty owners the full value of products manufactured from their share of Unit production, free of cost of manufacture, by confusing the rights of basic royalty owners, acquired by contract, with those of overriding royalty owners who had no such contractual rights.
Appellant contends that the overriding royalty owners must share in the expense of extracting the liquid hydrocarbons, and that the plant owners and operators are entitled to retain a portion of the sale price of such products to cover such expense. The gist of appellant’s argument seems to be that there is nothing in the Plan of Unit-ization which entitles any of the royalty owners to participate in the proceeds of the sale of the hydrocarbons without deduction of the cost of processing the gas whereby said hydrocarbons are obtained; that the right to so participate was transferred to the basic royalty owners by contract separate and apart from the unit plan, but that no such contract was ever made or entered into with the overriding royalty owners and that such overriding royalty owners are therefore not entitled to so participate without cost. Such argument does not appear to be supported by the record herein, however.
Analysis of the facts, as presented by the record in this cause, will reveal that Martin and others were entitled by contract with appellant to receive 5/16ths of the production of the oil and gas leases assigned, free and clear of the cost of production and operation of the leases, which was assumed by appellant, as assignee. Thereafter appellant joined with other lessees and formed under Oklahoma Law, a Unit Plan of operation. This plan of unitization was prepared by the lessees and approved by the-Corporation Commission. The majority opinion only refers to two paragraphs of such plan, but the pertinent provisions-thereof, insofar as this controversy is concerned, are as follows:
“Plan of Unitization of Elk City Hoxbar Sand Conglomerate Unit.
“Know All Men By These Presents:
“The following shall constitute the-Plan of Unitization applicable to the Elk City Hoxbar Sand Conglomerate Unit created pursuant to the authority of House Bill No. 339 of the 1945 Legislature of the State of Oklahoma, and having for its purpose the unitized management, operation, and further development of the Hoxbar Sand Conglomerate common source of supply of oil and gas underlying the lands outlined by the solid line on the map hereto attached and marked ‘Exhibit A’, all to the end that a greater ultimate recovery of oil and gas may be had' therefrom, waste prevented, and the correlative rights of the respective-owners protected.
“I
“Definitions
“As used in this Plan of Unitization,, the following terms and expressions are defined as follows:
*667“(a) ‘Unit’ shall mean the Elk City Hoxbar Sand Conglomerate Unit.
⅝ ⅝ ⅝ ⅜ 5fC ⅜?
“(e) ‘Oil and Gas1 shall not only refer to oil and gas as stick in combination one zvith the other, but shall have reference to oil, gas casinghead gas, casinghead gasoline, gas distillate, or other hydrocarbons, or any combination or combinations thereof, or any one thereof, which may be found in or produced from the Unit Area.
“(f) ‘Unit Production’ shall mean and include all oil and gas produced from the Unit Area from and after the effective date hereof regardless of the well or tract within the Unit Area ±rom which the same is produced.
“(g) ‘Lessee’ shall mean any own-er, in whole or in part, of an oil and gas lease or any unleased mineral interest, who alone or in association with another person or persons has the right, except for this Plan of Unitization, to explore, develop, and operate :a separately owned tract for oil and ;gas. An owner of an overriding royalty interest, oil payment, net profit contract, or other oil and gas rights of a .similar nature, who does not have the ■right to develop and operate, shall not ■be regarded as a lessee.
“(h) ‘Unit Operator’ shall mean and refer to the lessee designated to carry ■on and conduct the unitized operations within the Unit Area as provided in Section I hereof.
* * * * * ⅜
“(k) 'Unit Expense’ shall include ■any and all cost, expense, or indebtedness incurred by the Unit or Unit Operator as authorized by this Plan of Unitization or the order of the Commission creating the Unit.
⅜ * * * * *
“VI
"Effect of Unitization
“The adoption of this Plan of Uniti-zation and the creation of the Unit as herein provided shall have the effect from and after the effective date of unitizing all further development and operations for the production of oil and gas from the Unit Area and of pooling and unitizing the production so obtained, all to the same extent as if the Unit Area had been included in a single lease and all 'rights thereunder owned by the lessees in undivided interests. Property rights, leases, contracts, and all other rights and obligations in respect to the oil and gas rights in and to the several separately owned tracts within the Unit Area, from and after the effective date hereof, shall be and are hereby amended and modified to the extent necessary to make the same conform to the provisions and requirements of this Plan of Unitization, but otherwise to remain in full force and effect. * * *
“Nothing herein contained shall be construed to require or result in a transfer to or the vesting in the Unit of title to the separately owned tracts within the Unit Area or to the leases thereon, other than the right to use and operate the same to the extent set out in this Plan of Unitization; nor shall the Unit be regarded as owning any of the Unit Production. The Unit Production and the proceeds from the sale thereof shall be owned by the several persons to whom the same is allocated under this Plan of Unitization. * * *
“The amount of the unit production allocated to each separately owned tract and only that amount, regardless of the well or wells in the Unit Area from which it may be produced, and regardless of whether it be more or less than the amount of the production from the well or wells, if any, on any such separately owned tract shall, for all intents, uses, and purposes, be regarded and considered as production from such separately owned tract. * * *
*668“VII
“Allocation and Disposition of Unit Production
“All unit production as it is delivered by the Unit from the plant or plants or other facilities, except so much thereof as is used or consumed in developing, operating, cycling, repressur-ing, maintaining pressure, and in other operations carried on in accordance with this Plan of Unitization, or is unavoidably lost, shall be apportioned among and allocated to the several separately owned tracts zvithin the Unit Area, in accordance with the Formula which is attached hereto as ‘Exhibit B’.
“The unit production allocated to each separately owned tract shall be divided among the several persons, entitled to share in the production from such separately owned tract in the same manner, in the same proportions, and upon the same conditions that they would have participated and shared in the production from such separately owned tract had not the Unit been organized, and with the same legal force and effect. Each of such persons shall separately own, and shall separately take or sell its share of allocated unit production, and, in the latter event shall be entitled to receive payment directly from the purchaser.
“The share of the unit production allocated to each separately owned tract shall be delivered in kind to the persons entitled thereto by virtue of ownership of oil and gas rights therein, or to their vendees, or shall be delivered to the pipe line to the credit of such persons. Persons entitled to take and receive in kind any portion of the unit production shall have the right at their own expense to construct, maintain, and operate within the Unit Area facilities for that purpose, provided the same are so constructed, maintained, and operated as not to interfere with the operations carried on pursuant hereto, * * *
“The Unit Operator shall have the right to take and utilize or use so much of the unit production as may be necessary or desirable in the development and operation of the Unit Area, including, but without being limited to, the use of gas, including residue gas, for cycling, repressuring, pressure maintenance, or other operations under this Plan of Unitization. No royalties, overriding royalties, production payments, or other payments shall be required or payable upon or with respect to the portion of the unit production so taken and utilized or used, or that which is unavoidably lost.
* * * * * *
“(2) The Operating Committee shall have the general overall management and control of the Unit and the conduct of its business and affairs and the operations carried on by it, and is aur thorized and empowered, subject to the terms and provisions hereof, to do all things necessary, proper, and convenient for carrying out the terms and spirit of this Plan of Unitization and to that end, not excluding or limiting any other power or powers that may be necessary or proper for that purpose, shall have the following specific power and duties:
* *****
“(h) To approve and authorize the purchase, construction, location, abandonment, sale, or other disposal of any processing plant, compressor plant, gasoline plant, tank batteries, salt water .disposal system, or other facilities serving the Unit Area, or to contract with the owners of an individually owned plant or facilities to render in whole or in part the service desired.
* *****
“XI
“Unit Expense
“The Unit Operator in the first instance shall pay and discharge all cost *669and expense incurred in the development and operation of the Unit Area and in the conduct of the activities and affairs of the Unit. Such cost and expense shall be computed in accordance with the Accounting Procedure hereto attached, marked ‘Exhibit C and made a part hereof. Any cost or expense not contemplated by ‘Exhibit C’ shall be subject to approval of the Operating Committee.
“All such Unit Expense as it accrues shall be charged to the several separately owned tracts in the Unit Area in proportion to the percentage of interest of such tracts in and to Unit production.
“Except as may be otherwise hereinafter specifically provided, a lessee or lessees obligated or responsible for the cost and expenses of operating a separately owned tract for oil and gas in the absence of unitization shall, in the same proportion and to the same extent, be chargeable with and responsible for the payment of the unit expense charged against such separately owned tract, after such tract has become a part of the Unit Area. * * *
“The Unit shall have a first and prior lien upon the leasehold interest (exclusive of a Y& royalty interest) in and to each separately owned tract, the interest of the owners thereof in and to the Unit production and all equipment in possession of the Unit, to secure the payment of the Unit Expense and other items of cost charged to and against such separately owned tract, provided such lien may be enforced as against overriding royalty, oil and gas payments, royalty interests in excess of a ]/s of the production, or other interests which otherwise are not changeable with such costs, only in the event the owner of the interest or interests primarily reponsible fails to pay such unit expense when dtie. In the event the owner of any royalty interest, overriding royalty, oil and gas payment, or other interest which under the Plan of Unitization is not primarily responsible therefor pays any part of such unit expense in whole or in part the owner thereof shall, to the extent of such payment, be subrogated to all the rights of the Unit and of the Unit Operator with respect to the interest or interests primarily chargeable with such unit expense. A ⅛ part of the unit production allocated to each separately owned tract shall in all events be regarded as royalty and shall be free and clear of all unit expense and free of any lien therefor. The lien hereinabove provided for shall be for the use, benefit, and protection of Unit Operator or other lessees or persons entitled to receive or share in the monies, the payment of which is secured thereby, and, in the event of failure of the Unit to enforce such lien, the Unit Operator or other person entitled to the benefit thereof shall be subrogated to the lien rights of the Unit, including the right of foreclosure.
* * * * * *
“(a) As soon as practical after the effective date, the Unit shall make the necessary preparations therefor, and with diligence and in accordance with good engineering and production practices engage in cycling, pressure maintenance or repressuring operations through the return of gas to the reservoir to the extent and in the manner best calculated to result in the greatest ultimate recovery of oil and gas from' the Unit Area. In so doing, the Unit is authorized to construct, purchase, or otherwise acquire and operate such gasoline plants, processing plants, or compressor plants, and other facilities as may in the best judgment of the Operating Committee be desirable for that purpose, or is authorized, should it so-elect, to contract with the owners of an individually owned plant or plants and facilities to render in whole or in part the desired services in connection therewith.
*670“(b) Liquid hydrocarbons produced from the Unit Area shall be produced from those wells in the Unit Area from which the same can be obtained with the smallest loss or dissipation of reservoir energy reasonably possible under practical operation conditions as they may exist from time to time.
“(c) Wells which produce liquid hydrocarbons with gas-oil ratios found to be excessive in relation to the gas-oil ratios of other wells producing liquid hydrocarbons from the Unit Area shall be shut in or the production therefrom restricted in such manner as to make the most effective utilization of the gas energy of the reservoir reasonably possible under practical operating conditions as they may exist from time to time.
* * * * *
“(e) Gas (other than gas produced in connection with the production of liquid hydrocarbons) shall be produced from the Unit Area only at such time or times and in such manner as in the judgment of the Operating Committee such gas may be produced without materially decreasing the quantity of liquid hydrocarbons economically recoverable from the Unit Area.” (Emphasis added.)
The foregoing provisions of the Plan of Unitization would appear to be relatively plain and free from ambiguity. The plan specifically provides that any production shall mean and include all oil and gas produced in the unit area, and oil and gas is defined as meaning and including not only oil and gas, but oil, gas, casinghead gas, casinghead gasoline, gas distillate or other hydrocarbons or any combination or combinations thereof or any one thereof. This certainly means everything that is produced, and obviously includes the hydrocarbons which are involved in the present controversy. It might be noted in this regard that the only way that casinghead gasoline and other hydrocarbons could be produced, from this unit at least, would be by extracting them from the wet gas produced from the wells. The plan further provides that all unit production as it is delivered by the unit from the plant or the plant facilities shall be apportioned among and allocated to the separately owned tracts within the unit area. Such phaseology obviously should not mean that only a portion of the unit production should be allocated back to the mineral owners. The plant owners as such are not authorized to withhold any of the production from the unit for their own use, save and except that which is necessary for the development and operation of the unit area, such as the use of residue gas for cycling, repressuring and pressure maintenance. Unit expense as defined by the plan, includes any and all costs, expenses or indebtedness incurred by the unit or the unit operator, and certainly includes the cost of constructing and operating the plant here involved. Under the terms of the plan, the lessees are required to pay all of this expense. The term lessee is defined by the plan to mean the owner in whole or in part of oil and gas leases and it is specifically provided that overriding royalty owners shall not be regarded as lessees. To impose a charge on the overriding royalty owners for processing the gas through the plant to extract the hydrocarbons therefrom would, in fact, impose upon such overriding royalty owners a share of the cost of operating such plant, in direct contravention of the plain provisions of the plan of unitization, and I am of the opinion that the Commission was eminently correct in so holding.
Appellant argues that the operators, or lessees, are only obligated to produce and operate the leases and are not obligated to process the wet gas to extract the hydrocarbons therefrom; that the plan and order do not require the construction and operation of the processing plant and that the obligations of the lessees could have been met by simply repressuring and recycling the wet gas produced from the wells without processing the same and extracting the hydrocarbons therefrom. Such statements are true, but I do not see how they help appellant’s case. Neither the plan of unitiza*671tion nor the order of the Commission requires the lessees to build the plant and extract the hydrocarbons from the gas prior to reinjecting the gas into the reservoir, but such plan and order authorize such lessees to take such action provided they do so at their own expense. The order appealed from does not force the operators to process the royalty owners gas free of charge; it simply tells the operators that if they choose to extract the hydrocarbons from the gas produced, they must account to the owners thereof for all of the hydrocarbons so extracted.
Appellant also suggests that the original plan did not contemplate the erection of a multi-million dollar processing plant and that when such plan provided that the operators would pay unit expense it was not contemplated that such expense would include the cost of constructing and operating such a plant, and that at the time the order approving such plan was entered there was no issue presented concerning the division of the products of such plant and that the order entered could not have decided such issue and that the Commission therefore cannot now interpret such order as deciding an issue which was not presented. The majority opinion apparently adopts such view, but the record completely refutes such argument. The record reveals that the plan for unit and plant operation was conceived and proposed by Shell Oil Company and that on March 8, 1950, a meeting of operators in the Elk City Field was held at which time a representative of Shell Oil Company proposed in substance the plan later adopted. At such meeting, which was attended by Martin and Ellison, Shell’s proposed plan was briefly outlined as being:
1. The operation of the Elk City Field under gas cycling and pressure maintenance programs which would necessitate complete unitization of the field.
2. The construction at unit expense of a gasoline plant for processing gas, stabilizing crude oil and furnishing gas under pressure for cycling and pressure maintenance programs, the capacity of the plant to be 100 million cubic feet of gas per day and the cost of construction approximately $6,000,000.
Shell’s representative outlined the plan as contemplating the entire well effluent flowing to the plant under 900 to 1000 pounds pressure so that there would be no waste of any hydrocarbons, and suggested that the procedure to accomplish the objective and obtain the benefits of the proposed program would be:
1. The operators should agree in principle to unitization under the Oklahoma Unitization Law of all working interests and royalty interests in the common source of supply.
2. The operating companies should develop plans for gas cycling and pressure maintenance programs and participation factors for unitization.
3. The unit should build a gasoline plant and pay ⅛ royalty on all plant products sold.
It was stipulated that Shell’s representative would testify that Shell Oil Company, for policy reasons, proposed and agreed to pay all of the royalty owners and all of the lessees one hundred percent of all the products of the plant, and that the reason for this was that when the plan of unitization was discussed, it was stated what while it might be proper to impose upon the royalty owners some cost of the processing, the matter of debating what charge should be made against the royalty owners, and one thing and another, would so impede the actual formation of the unit that it would be better in all instances to simply pay the royalty owners one hundred percent and evade any debate whatever as to what would have been a proper charge.
Thereafter the plan of unitization above set out was prepared and submitted to the Corporation Commission for approval, and on October 27, 1950, the Commission entered its order creating the Unit and approving the Plan of Unitization. The point to be noted here is that at least two of the overriding royalty owners were present at and participated in the conferences where the *672plan was proposed and were represented by counsel before the Commission when the order approving the plan was entered. The plan as submitted specifically mentions and defines overriding royalty owners, basic royalty owners and lessees and specifies the obligations of each with regard to payment of costs. The statute then in effect, 52 O.S.Supp.1947 § 286.4 specifically enjoined upon the Commission the duty of ordering the creation of the unit and approval of the plan of unitization only upon such terms and conditions as might be fair, reasonable, equitable and which are necessary or proper to protect, safeguard, and adjust the respective rights and obligations of the several persons affected, including royalty owners, owners of overriding royalties, and others, as well as the lessees. The argument that there was no issue presented to the Commission at the time of the original order approving the unit plan as to rights of overriding royalty owners is obviously without merit. The statute under which the parties were then proceeding raised the issue and imposed upon the Commission the duty of deciding it, whether raised by the lessees or not. We cannot presume that the Commission did not carry out its statutory duty, particularly in the face of its own finding that it did.
There is also in the record a letter of recent date from the same representative of Shell Oil Company above mentioned to one of appellant’s attorneys in which such representative stated that by royalty owners he had in mind those owners of minerals who had to consent to the Unit Plan before it could become effective and that he didn’t believe that the position of the overriding royalty interests was ever mentioned at the original meetings of the lessees. Appellant argues at length, on the basis of this letter, that 52 O.S.1951 § 287.5, requires that a plan of unitization be signed or approved by owners of record of not less than 63% of the normal ⅛ royalty interest in and to the unit area before it can become effective, and that in order to secure such approval in the instant case, the lessees voluntarily extended to such basic royalty owners the right of 100% participation in the plant products without cost to them, but that since it was not necessary to have the approval of the overriding royalty owners in order to make the plan effective there was no reason or need to extend such right of participation to them and the same was therefore not done. The most obvious fallacy in this argument, other than its lack of pertinence, is that the statute relied upon as requiring the approval of 63% of the basic royalty owners to the plan was not enacted until 1951. The order of the Commission approving the plan here involved was promulgated in 1950, and all the negotiations and preparations above outlined occurred prior to that time, and at all such times there was no statute requiring the approval or consent of any royalty owners, basic or otherwise, to such plan. As already stated, the unit here involved was proposed, created and approved under the authority and provisions of Title 52, chapter 3b, of the Oklahoma Session Laws 1945, later repealed. Such Act required only the approval of the lessees and the Commission to any plan of unitization. Royalty owners, both basic and overriding, had the right to appear before the Commission and protest the proposed plan, but their approval was not required, and they were both dependent upon the Commission for the protection of their rights. Appellant’s argument that there was a valid reason for differentiating between basic royalty owners and overriding royalty owners is completely without basis or merit.
If there were any ambiguity in the Plan of Unitization here involved and the original order of the Commission approving the same, the same has been resolved by the orders herein appealed from. The power of the Commission to so clarify its previous order cannot be doubted in view of the express provision of the Plan reserving to the Commission continuing jurisdiction over the Unit for the purpose of determining, modifying and interpreting the terms and provisions of the Plan, the provision of 52 O.S.1951 § 112, and the opinion of the Circuit Court of Appeals in the case of *673Constantin v. Martin, 10 Cir., 216 F.2d 312, and such can be done without invading the exclusive province of the courts. Cabot Carbon Company v. Phillips Petroleum Co., Okl., 287 P.2d 675.
I find no error in the orders appealed from and am of the opinion the same should be affirmed.
I therefore dissent.