5 April 1991 T.I. (Tax Window, No. 3, p. 6, ¶1268)

RC's assessing policy that under a farm-out it is not possible to ascertain the value of the consideration flowing between the parties and, therefore, the consideration for the disposition should be treated as being nil, does not apply to "widespread farm-outs" in which the farmee incurs CEE or CDE in respect of one property in order to earn an interest in a non-contiguous property.

Unde a widespread farm-out RC will consider the value of the non-contiguous property received by the farmee to be a reimbursement to the farmee for part of its CEE or CDE, with the result that the farmee's CEE or CDE pools will be reduced by that amount.