If a percentage penalty has been assigned to an oil well, the penalty shall, depending on the status of the well, be subtracted from:

1. (1) Discovery status. The applicable allowable from the Discovery Allowable Table (Appendix B to this Chapter) or the capacity of the well to produce as reported, whichever is less.
2. (2) If allocated or unallocated per-well status. The applicable allowable from the Allocated Well Allowable Table (Appendix A to this Chapter) multiplied by the current market demand factor or the capacity of the well to produce as reported, whichever is less.
3. (3) If unallocated per-lease status. The shallowest ten acre or less allowable from the Allocated Well Allowable Table (Appendix A to this Chapter) multiplied by the current market demand factor for the penalized well only. The penalty shall be subtracted from the lease allowable.

Amended at 26 Ok Reg 2498, eff 7-11-09