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RECEIVED 12/7/2( 2:07 PM
RECEIVING # 925119
BOOK: 642 PAGE: 428
JEANNE WAGNER
LINCOLN COUNTY CLERK, KEMMERER, WY
SURFACE OWNER'S AGREEMENT
DOCUMENTN~~2SB
THIS AGREEMENT, made and entered into this 7th day of November, 2006, by and between
UINTA DEVELOPMENT COMPANY (hereinafter for convenience called the "Landowner") and
ANADARKO LAND CORP (hereinafter for convenience called "ALC");
WIT N E SSE T H:
,
Landowner is the owner of the following-des ribed premises, hereinafter referred to as "described
premises":
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SUBJECT, however, to exceptions and reservatio s of minerals and rights of entry and of surface use
contained in a certain deed or deeds of conveyance, follows: Warranty Deed No. 5023 dated January 3,
1919 trom Union Pacific Railroad Company to Uint Development Company, recorded April 22, 1933 in
Book 18 at Page 71 in the office ofthe County Clerk and Recorder of Lincoln County, Wyoming; and Quit
Claim Deed No. LP-197, trom Union Pacific Railroad Company to Union Pacific Land Resources
Corporation, recorded in Book 93 at Page 648 in the office of the County Clerk and Recorder of Lincoln
County, Wyoming. ALC is successor in interest to all the right, title and interest of Union Pacific Land
Resources Corporation in and to the oil, gas and associated liquid hydrocarbons in said premises for a term
or period equal to or exceeding the term of this Surface Owner's Agreement.
ALC proposes for ALC or its agents, lessees, licensees, successors or assigns to prospect upon and
explore the described premises for the development and production of oil, gas and associated liquid
hydrocarbon substances either on ALe's behalf or under or pursuant to an oil and gas lease or license, or
under or pursuant to an "operating agreement", meaning here and wherever that term is used herein any
agreement covering the exploration or development for or the production of oil, gas or associated
hydrocarbon or non-hydrocarbon substances whereby the described premises November be included with
other lands in proximity thereto as an area under a plan of unit or joint exploration, development and
operation, including, without limitation, ajoint operating agreement, a unit agreement, a pooling agreement
or a communitization agreement.
Besides confirming the surface uses expressly set forth below, this agreement is intended to avoid
and resolve any and all disputes of whatever nature in connection with the ownership of oil, gas and
associated hydrocarbon and non-hydrocarbon substances in the described premises, including rights to
extract, remove or market such minerals, and including any such dispute that November arise hereafter,
whether or not the basis for such dispute is now known or has been identified in disputes involving
exceptions and reservations of minerals in other deeds from Union Pacific Railroad Company or its
predecessors.
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NOW, THEREFORE, it is agreed as follows: O~~~~ ~,)¡·l,jL~~.~
000429
Section 1. In consideration of the mutual benefits and other good and valuable consideration,
Landowner hereby confirms, extends and grants to ALC, its agents, contractors, subcontractors, invitees,
lessees, licensees, successors and assigns, including any operator ITom time to time in charge of operations
under an operating agreement, and their respective successors and assigns, the easements and rights to enter
upon the described premises and any other lands in proximity thereto owned or claimed by the Landowner
and to extract, remove, store, transport, and market for its or their account oil, gas and associated
hydrocarbon and non-hydrocarbon substances in or ITom any portion of said described premises or any
portion ofthe lands included with any portion ofthe described premises under an operating agreement and
to drill, construct, maintain and use upon, within, and over said described premises all oil wells, gas wells,
injection wells, derricks, machinery, tanks, boilers, engines, pipelines, power and telephone lines, roadways,
water wells, and, without limitation by reason ofthe foregoing enumeration, any and all other structures,
equipment, fixtures, appurtenances, or facilities (all of the above being included under the term "facilities")
necessary or convenient in prospecting and developing for, producing, storing, transporting, and marketing
oil, gas and associated hydrocarbon and non-hydrocarbon substances under or produced ITom any portion of
the described premises or under or produced ITom any portion ofthe lands included with any portion ofthe
described premises under an operating agreement, together with the right to remove said facilities, the right
to inject substances into the described premises to enhance the recovery of oil, gas and associated
hydrocarbon and non-hydrocarbon substances ITom any portion of the described premises or under or
produced ITom any portion of the lands included with any portion of the described premises under an
operating agreement, the right to inject into the described premises substances produced rrom any portion of
the described premises or under or produced rrom any portion ofthe lands included with any portion ofthe
described premises under an operating agreement, and the right to use such water as November be needed
ITom the described premises, not including water ITom Landowner's wells,
Section 2. For the same consideration recited in Section 1 above, Landowner hereby confirms,
extends and grants to ALC, its agents, contractors, subcontractors, invitees, lessees, licensees, successors
and assigns, including any operator rrom time to time in charge of operations under an operating agreement,
and their respective successors and assigns, the easements and rights to enter upon the described premises
and other lands adjacent thereto owned or claimed by Landowner to conduct any and all activities
reasonable and necessary to satisfy any and all governmental permitting or regulatory requirements related
in any way to the exploration, development, production, extraction, removal, storage, transportation and
marketing for its or their account oil, gas and associated hydrocarbon and non-hydrocarbon substances in or
ITom any portion of said described premises or any portion of the lands included with any portion of the
described premises under an operating agreement including, but not limited to the gathering of any
information related to an environmental or biological surveyor assessment. Nothing herein contained shall
be construed as an obligation for ALC to conduct an environmental or biological surveyor assessment.
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.. ,. Section 3, ALC agrees, so long as it is receiving oil and/or gas production from or oil and/or gas
royalties upon production from a well with a surface location on the described premises or production
allocated to the described premises under the provisions of an operating agreement, to payor cause to be
paid to the Landowner in cash the value oftwo and one-half percent (2 l/2%) ofthe proceeds from the sale
of all the oil and gas and associated hydrocarbon and non-hydrocarbon substances hereafter produced,
saved, and marketed from the described premises or allocated thereto under the provisions of an operating
agreement except as to oil and gas and associated hydrocarbons and non-hydrocarbons used in operations
on the described premises or used under the operating agreement; provided, however, that during any time
the described premises, or any portion thereof, are included within the boundaries of a participating area, a
unit area, a pooled area or a communitized area in which ALC's oil and/or gas production from or oil
and/or gas royalties upon production from a well with a surface location on the described premises are
computed based on the quantity of production allocated to the described premises pursuant to the terms of
the appUcable operating agreement rather than- upon the basis of actual production from a well with a
surface location on the described premises, then the payment to Landowner stipulated herein shall likewise
be computed based on the production allocated thereto under the terms of such operating agreement. If
ALC owns an interest in the mineral acres underlying the described premises less than the entire fee simple
estate, then the payment to Landowner stipulated in this Section 3 shall be reduced proportionately in
accordance with ALC's proportionate mineral interest ownership, Any payment made to the'Landowner
pursuant to this Section 3 for production which is sold or which is used off the premises shall be calculated
after deducting all taxes, now or hereafter levied against, paid on, or measured by production or the value
thereof, and after deducting all costs incurred or borne by ALC to make the production marketable or prior
to delivery ofthe production to the purchaser at the point of sale or use, including, but not limited to, costs
of separating by mechanical means, gathering, dehydrating, compressing, processing, treating, storing,
transporting, marketing, delivering or any other charge or deduction whatsoever of the same or different
character and as to casinghead gasoline and other products manufactured from gas there shall be deducted
the cost of manufacture. In no event shall the payment to Landowner stipulated in this Section 3 be due
from ALC prior to actual receipt by ALC of the proceeds from the sale of the described production or
royalties on the described production.
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When production from lands under several surface ownerships is commingled in one central setting
for practical operating reasons, periodic individual well tests November be made to compute the quantities
of commingled production properly allocable to each well, and the two and one-half percent (2 l/2%)
payment provided herein shall be payable upon the quantities apportioned to each well as reported to ALC
in full satisfaction of the obligations of ALC under this Section 3, Ifperiodic individual well tests are not
conducted then production shall be apportioned by dividing the quantity of commingled production by the
number of wells producing the same,
Section 4, Landowner acknowledges that the obligations of ALC created under Section 3 hereof
are contractual obligations and Landowner does not own or claim any right, title or interest in the oil, gas
and associated hydrocarbon or non-hydrocarbon substances in or from the described premises, Nothing
herein contained shall be construed as a covenant to drill by ALC, its agents, lessees, licensees, successors,
or assigns, or by any operator, or as a grant to Landowner of oil or gas rights or rights in other associated
hydrocarbon or non-hydrocarbon substances,
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Section 5, Other than the payments to be made pursuant to Section 3 hereof, the Landowner I
shall not be entitled to any other or additional payments as a result of the conduct of the operations :
described in Section 1 or Section 2 hereof other than any additional compensation for surface damages and
rights of way which Landowner November negotiate with the operator of such operations under a separate
agreement.
Section 6, Subject to the provisions of Section 8 hereof, it is agreed that the covenants to pay
the sums provided in Section 3 hereof shall be covenants running with the surface ownership of the
described premises and shall not be held or transferred separately thererrom, and any sums payable under
this agreement shall be paid to the person or persons owning the surface ofthe described premises as of the
date the oil or gas or associated hydrocarbon or non-hydrocarbon production is marketed, ALC shall not,
however, become obligated to make such payments to any subsequent purchaser ofthe described premises
and shall continue to make such payments to the Landowner until the first day ofthe month following 30
days after the receipt by ALC of notice of change of ownership, consisting of a copy of the recorded
instrument or instruments constituting a complete chain oftitle rrom the Landowner to the party claiming
such ownership, and then only as to payments thereafter made, If subsequent to the date hereof Landowner
conveys a portion but not all of the described premises and production is not then being allocated to the
described premises under the provisions of an operating agreement, the payments to be made thereafter
pursuant to Section 3 hereof shall be due and payable only to the persons owning that portion of the surface
ofthe described premises where the well described in Section 3 is located, Notwithstanding the foregoing
sentence, the provisions of Section 7 hereof shall continue to be applicable to each and every part of the
described premises,
Section 7, The easements, rights, and uses herein shall be binding upon the described premises
and each and every part thereof, and the present and future owners thereof, and shall continue for the benefit
of ALC and its successors and assigns, as owners of the oil and/or gas and/or associated hydrocarbon or
non-hydrocarbon rights in the described premises and each and every part thereof, and their agents,
contractors, subcontractor, invitees, lessees, licensees, successors, and assigns, including any operator, and
for the benefit of other lands within any area within which the described premises, or any portion thereof,
November be included under or pursuant to an operating agreement, and each and every part thereof,
Section 8, This agreement shall be in full force and effect rrom and after its execution in full and
delivery and shall continue in full force and effect for a period of one (1) year and so long thereafter as any
portion of the described premises are committed to an oil and gas lease or license or to an operating
agreement, or so long thereafter as a well capable of producing oil or gas or associated hydrocarbon or non-
hydrocarbon substance has a surface location upon the described premises , or drilling, reworking or
recompletion operations are being conducted thereon, and upon termination of such lease, license or
operating agreement, or upon abandonment of such well, or upon cessation of such drilling, reworking or
recompletion operations, whichever last occurs, this agreement shall terminate; provided, however, that
such termination shall neither affect nor terminate the rights, expressed or implied, in the deed or deeds
referred to in the Recitals hereof,
Section 9, Subject to the provisions of Sections 6 and 8 hereof, this agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators,
successors, and assigns,
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Section 10. This agreement is intended by the parties as a complete and final statement of the
agreement, and supersedes and replaces any prior surface owner agreement between ALC or its
000432
predecessor in interest and the Landowner or its predecessor in interest affecting the described premises and
contemplating payments to the Landowner based on proceeds from production. This agreement shall not be
amended or modified except by an instrument in writing duly executed by the parties hereto or their
respective assigns,
Section 11, THIS SECTION INTENTIONALLY DELETED.
Section 12. This Agreement November be executed as one document signed by all parties or the
parties named herein November join herein by execution of a counterpart with the same effect as if all
parties executed this Agreement. The failure of anyone or more ofthe parties named herein to execute this
Agreement shall not in any manner affect the validity of same as to the parties who do execute this
Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this agreement this ~ day of
flO'/ern.&r ,2Q:1b" to be effective as of the day and year first above written,
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UINTA DEVELOPMENT COMPANY:
ATTEST:
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Taxpayer Identification Number
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STATE OF TEXAS
COUNTY OF MONTGOMERY
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000433
The foregoing instrument was acknowledged before me this ~ day of f!Dtl!.IfJh.ur. 2006, by
James 1. Newcomb, as Agent and Attorney-in-Fact of ANADARKO LAND CORP, a Nebraska
corporation, on behalf of the corporation,
My Commission Expires:
J J-^lCv:J
STATE OF
COUNTY OF ~t>itÔ-'1"~
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Notary Public
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I": e A. SEIFERT
Notary Pubßc
. .. STATE OF TEXAS
My Comm. Exp. 01/07/2010
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The foregoing instrument was acknowledged b~fore me this JD- day of t] 1J7J-try-r.Jw-J
by -!r ~~í ,as (jJ(~^IÍ
f)). \J~~ r if ,a Wyoming corporation, on behalf of the corporation.
My Commission Expires: ~J oj d.-D~
f'¡
, Jt.AJYrJ~
Notary,
~'M'"
4I!~~~ SUZANN TURNER
. (*~ MY COMMISSION EXPIRES
';ii,il August 10, 2008
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, 2006,
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