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HomeMy WebLinkAbout929570 OIL AND GAS LEASE 000783 This Oil and Gas Lease ("Lease") is made effective the ~ day of ADril. 2007, by and between Julian Land and Livestock ComDanv. bv: Truman D. Julian. President. whose address is 409 Quartz Street Kemmerer. Wvomin2 83101 ("Lessor", whether one or more) and Fitzsimmons, LLC. whose address is 2201 Cabin Court Gillette, WY 82718 ("Lessee"). WITNESSETH, For and in consideration of TEN DOLLARS, the covenants and agreements contained herein, and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, Lessor does hereby grant, demise, lease and let exclusively unto said Lessee, with the exclusive rights for the purposes of mining, exploring by geophysical and other methods and operating for and producing thereftom oil and all gas of whatsoever nature or kind, and laying pipelines, telephone and telegraph lines, building tanks, plants, power stations, roadways and structures thereon to produce, save and take care of said products and the exclusive surface and subsurface rights and privileges related in any manner to any and all such operations, and any and all other rights and privileges necessary, incident to, or convenient for the operation alone or conjointly with neighboring land for such purposes, all that certain tract or tracts ofland situated in LINCOLN. Wyoming, described as follows, to-wit: SEE EXIllBIT" A" ATTACHED TO AND MADE A PART HEREOF FOR DESCRIPTIVE PURPOSES, and containing 4615.14 acres, more or less, (the "Premises"). 1. It is agreed that this Lease shall remain in force for a tenn of five (5) years ftom this date ("Primary Tenn") and as long thereafter as oil or gas of whatsoever nature or kind is produced ftom the Premises or on acreage pooled or unitized therewith, or operations are continued as hereinafter provided. If, at the expiration of the Primary Tenn, oil or gas is not being produced ftom the Premises or on acreage pooled or unitized therewith but Lessee is then engaged in drilling, reworking or other operations calculated to obtain or restore production ftom the leased premises thereon, then this Lease shall continue in force so long as such operations are being continuously prosecuted, Operations shall be considered to be continuously prosecuted if not more than ninety (90) days shall elapse between the completion or abandonment of one well and the beginning of operations for the drilling of a subsequent well. If after discovery of oil or gas on the Premises or on acreage pooled or unitized therewith, the production thereof should cease from any cause after the primary tenn, this Lease shall not tenninate if Lessee commences additional drilling, reworking operations within ninety (90) days ftom date of cessation of production or ftom date of completion of dry hole, completion or workover operation. If oil or gas shall be discovered and produced as a result of such operations at or after the expiration of the Primary Tenn, this Lease shall continue in force so long as oil or gas is produced ftom the Premises or on acreage pooled or unitized therewith. 2, This is a PAID-UP LEASE. In consideration of the payment made herewith, Lessor agrees that Lessee shall not be obligated, except as otherwise provided herein, to commence or continue any operations during the primary tenn. Lessee may at any time or times during or after the Primary Tenn surrender this Lease as to all or any portion of the Premises and as to any strata or stratum, by delivering to Lessor or by filing for record a release or releases, and be relieved of all obligations thereafter accruing as to the acreage surrendered. 3. The royalties to be paid by Lessee are: ( a) On oil and other liquid hydrocarbons, ONE-SIXTH (1/6"') of that produced and saved ITom said land, the same to be delivered at the wells, or to the credit of Lessor into the pipeline to which the wells may be connected; Lessee may ftom time to time purchase any royalty oil in its possession, paying the market price therefore prevailing for the field where produced on the date of purchase; (b) on gas and the constituents thereof produced ftom said land and sold or used off the premises or in the manufacture of products thereftom, the market value at the well ofONE-SIXTII (1/6"') of the product sold or used. On product sold at the well, the royalty shall be ONE-SIXTH (1/6110) of the net proceeds realized ftom such sale, All royalties paid on gas sold or used off the premises or in the manufacture of products thereftom will be paid after deducting ftom such royalty Lessors proportionate amount of all post-production costs, including but not limited to gross production and severance taxes, gathering and transportation costs ftom the wellhead to the point of sale, treating, compression, and processing. On product sold at the well, the royalty shall be ONE-SIXm (1/6"') of the net proceeds realized ITom such sale, after deducting ftom such royalty Lessor's proportionate amount of all of the above post-production costs and expenses, if any. 4, Where gas ftom a well capable of producing gas is not sold or used after the expiration of the Primary Term, Lessee shall payor tender as royalty to Lessor at the address set forth above One Dollar per year per net mineral acre, such payment or tender to be made on or before the anniversary date of this Lease next ensuing after the expiration of ninety (90) days ftom the date such well is shut in and thereafter on or before the anniversary date of this Lease during the period such well is shut in. 5. If Lessor owns a lesser interest in the Premises than the entire and undivided fee simple estate therein, then the royalties (including any shut-in gas royalty) herein provided for shall be paid Lessor only in the proportion which Lessor's interest bears to the whole and undivided fee. 6, Lessee shall have the right to use, me of cost, gas, oil and water produced on the Premises for Lessee's operations thereon, except water ftom the wells of Lessor, 7. When requested by Lessor, Lessee shall bury Lessee's pipeline below plow depth. 8. No well shall be drilled nearer than 200 feet to the house or barn now on the Premises without written consent of Lessor. 9. Lessee shall have the right at any time to remove all machinery and fixtures (including casing) Lessee has placed on the Premises. 10. The rights of the Lessor and Lessee hereunder may be assigned in whole or part. No change in ownership of Lessor's interest (by assignment or otherwise) shall be binding on Lessee until Lessee has been furnished with notice, consisting of certified copies of all recorded instruments or documents and other infonnation necessary to establish a complete chain of record title ftom Lessor, and then only with respect to payments thereafter made. No other kind of notice, whether actual or constructive, shall be binding on Lessee, No present or future division of Lessor's ownership as to different portions or parcels ofthe Premises shall operate to enlarge the obligations or diminish the rights of Lessee, and all Lessee's operations may be conducted without regard to any such division. If all or any part of this Lease is assigned, no leasehold owner shall be liable for any act or omission of any other leasehold owner. 11. Lessee, at its option, is hereby given the right and power at any time and ftom time to time as a recurring right, either before or after production, as to all or any part of the Premises and as to anyone or more of the fonnations thereunder, to pool or unitize the leasehold estate and the mineral estate covered by this Lease with other land, lease or leases in the immediate vicinity for the production of oil and gas, or separately for the production of either, when in Lessee's judgment it is necessary or advisable to do so, and irrespective of whether authority similar to this exists with respect to such other land, lease or leases. Likewise units previously fonned to include fonnations not producing oil or gas, may be refonned to exclude such non-producing fonnations, The fonning or refonning of any unit shall be accomplished by Lessee executing and filing of record a declaration of such unitization or refonnation, which declaration shall describe the unit. Any unit may include land upon which a well has theretofore been completed or upon which operations for drilling have theretofore been commenced. Production, drilling, reworking or dewatering operations or a well shut in for want of a market anywbere on a unit which includes all or a part of this Lease shall be treated as if it were production, drilling, reworking or dewatering operations or a well shut in for want of a market under this Lease. In lieu of the royalties elsewhere herein specified, including shut-in gas royalties, Lessor shall receive royalties on production ITom such unit only on the portion of such production allocated to this Lease. In addition to the foregoing, Lessee shall have the right to unitize, pool, or combine all or any part of the Premises as to one or more of the fonnations thereunder with other lands in the same general area by entering into a cooperative or unit plan of development or operation approved by any governmental authority and, ftom time to time, with like approval, to modifY, change or tenninate any such plan or agreement and, in such event, the terms, conditions and provisions of this Lease shall be deemed modified to confonn to the tenns, conditions, and provisions of such approved cooperative or unit plan of development or operation and, particularly, all drilling and development requirements of this Lease, express or implied, shall be satisfied by compliance with the drilling and development requirements of ~uch plan or agreement, and this Lease shall not terminate or expire during the life of such plan or agreement. In the event that the Premises or any part thereof, shall hereafter be operated under any such cooperative or unit plan of development or operation whereby the production thereftom is allocated to different portions of the land covered by said plan, then the production allocated to any particular tract of land shall, for the purpose of computing the royalties to be paid hereunder to Lessor, be regarded as having been produced ftom the particular tract of land to which it is allocated and not to any other tract of land; and royalty payments to be made hereunder to Lessor shall be based upon production only as so allocated. Lessor shall fonnally express Lessor's consent to any cooperative or unit plan of development or operation adopted by Lessee and approved by any governmental agency by executing the same upon request of Lessee. 12. All express or implied covenants of this Lease shall be subject to all Federal and State Laws, Executive Orders, Rules or Regulations, and this Lease shall not be terminated, in whole or in part, nor Lessee held liable in damages, for failure to comply therewith if compliance is prevented by, or if such tàilure is the result of, any such Law, Order, Rule or Regulation. Any delay or interruption caused by stonn, flood, acts oftelTorism, act of God or other event offorce majeure shall not be counted against Lessee. If, due to the above causes or any cause whatsoever beyond the control of Lessee, Lessee is prevented trom conducting operations hereunder, such time shall not be counted against Lessee, and this Lease shall be extended for a period oftime equal to the time Lessee was so prevented, anything in this Lease to the contrary notwithstanding. 13. Lessor hereby warrants and agrees to defend the title to the Premises and agrees that Lessee shall have the right at any time to redeem for Lessor, by payment, any mortgages, taxes or other liens on the Premises, in the event of default of payment by Lessor, and be subrogated to the rights of the holder thereof, and the undersigned Lessors, for themselves and their heirs, successors and assigns, hereby surrender and release all right of dower and homestead in the Premises, insofar as said right of dower and homestead may in any way affect the purposes for which this Lease is made, as recited herein. 14. Should anyone or more of the parties named as Lessor herein fail to execute this Lease, it shall nevertheless be binding upon all such parties who do execute it as Lessor. The word "Lessor," as used in this Lease shall mean anyone or more or all of the parties who execute this Lease as Lessor. All the provisions of this Lease shall be binding on the heirs, successors and assigns of Lessor and Lessee. 15. If at anytime within the primary tenn of this lease and while the same remains in force and effect, Lessor receives any bona fide offer, acceptable to Lessor, to grant an additional lease covering all or part of the aforesaid lands, Lessee shall have the continuing option by meeting any such offer to acquire such lease. Any offer must be in writing, and must set forth the proposed Lessee's name, bonus consideration and royalty consideration to be paid for such lease, and include a copy of the lease fonn to be utilized which fonn should reflect all pertinent and relevant tenns and conditions of the lease. Lessee shall have fifteen (15) days after receipt, ftom Lessor, ofa complete copy of any such offer to advise Lessor in writing of its election to enter into an oil and gas lease with Lessor on equivalent terms and conditions. If Lessee fails to notifY Lessor within the aforesaid fifteen (15) days period of its election to meet any such bona fide offer, Lessor shall have the right to accept said offer. 16. Except as otherwise provided herein, at the end of the primary term of this Lease, this Lease shall tenninate and Lessee shall promptly release this Lease as to all acreage lying outside of the spacing units established by the Wyoming Oil and Gas Conservation Commission or any other governmental agency having jurisdiction for each well located on the leased premises or lands spaced therewith which is producing gas or water. 17. Lessee shall pay for all damage to roads, fences, improvements and growing crops caused by its operations hereunder, and will fill and level any pits and mounds, remove all board roads and board road materials, level and fill all ruts, and restore the surface of the ground as near to its original condition as is reasonably practical within a reasonable period of time after cessation of operations at each well location on the leased premises. RECEIVED 5/21/2007 at 12:14 PM RECEIVING # 929570 BOOK: 658 PAGE: 783 JEANNE WAGNER LINCOLN COUNTY CLERK, VE::UU~RER, WY 1!J;;~9Sr';O IN Wl1NESS WHEREOF, this instrument is executed as of the date first above written. 000784 ~~J~Q~~2Jl.- (" ~~7?= Julian Land and Livestock Company, by: Truman D. Julian, President. STATE OF WYOMING } UNœORMACKNOWLEDGEMENT ss. , COUNTY OFæ~ý\. } - ~ BEFORE ME, the undersigned authority, a Notary Public, on this day personally appeared h...LI~ D ' , known to be the person(s) who executed this within and foregoing instrument, and acknowledged to me that he/she executéâ the same. . tome Given under my hand and official seal, this the / day of fYl ~ ,2007. My Commission Expires: M / ~ /).()OÎ N_Publi~(~~ Address: 2/L &J '31 Ò LOUISE WOOLSEY - NOTARY PUBUC COLMY(J 'STAlEa' LN;!X.N IV1f.IIG My Cormission Expires 7. ~ J (, 'JoO? EXHIBIT " A" ()~29sr?û 000785 ATTACHED TO AND MADE A PART OF THAT CERTAIN OIL, GAS AND MINERAL LEASE DATED APRIL 30,2007 BETWEEN, JULIAN LAND AND LIVESTOCK COMPANY, BY TRUMAN D. JULIAN, PRESIDENT, AS LESSOR, AND FITZSIMMONS LLC., AS LESSEE. Township 21 North. Ranl!e 119 West. 6th P. M. Section 2: 37.96 acres, more or less, as described in that certain Warranty Deed dated February 4, 1932 ITom A. D. Hoskins and wife, Kate S. Hoskins to William Julian and recorded in Book 19, Page 43 of the Deed Records of Lincoln County, Wyoming. Section 11: Nl/2 Section 12: NWl/4NWl/4, SWl/4NWl/4, NWl/4SWl/4 Section 23: SWl/4NEl/4, NWl/4SEl/4, El/2SWl/4 Section 26: NWl/4NWl/4 Township 22 North. Ranl!e 118 West. 6th P. M. Section 17: Wl/2 El/2 Section 20: Wl/2NEl/4 Township 22 North. Ranl!e 115 West. 6th P. M. Section 6: Lot 4 (38.23), Lot 5 (38.21), Lot 6 (38.25), Lot 7 (38.30), El/2SWl/4, SEl/4 Section 7: Lot 1 (38.34), Lot 2 (38.39), Lot 3 (38.43), Lot 4 (38.48), NEl/4, NEl/4SEl/4 Section 8: NWl/4NWl/4, NWl/4SWl/4 Section 18: Lot 1 (38.57), Lot 2 (38.72) Section 19: Lot 1 (39.14), Lot 2 (39.27) Township 22 North. Ranl!e 116 West. 6th P. M. Section 1: Lot 3 (16.11), Lot 4 (23.89), NEl/4SWl/4, El/2 Section 12: Lot 1 (41.67), Lot 2 (41.65), Lot 3 (41.62), Lot 4 (41.59), Lot 5 (38.48), Lot 6 (40.09), Lot 7 (40.09), Lot 8 (38.51) Lot 9 (38.54), Lot 10 (40.09), Lot 11 (23.19), Lot 12 (16.18), Lot 13 (22.23), Lot 14 (16.21), El/2NEl/4, El/2SEl/4 Section 13: Lot 1 (41.59), Lot 2 (41.60), Lot 5 (38.54), Lot 6 (40.04), Lot 7 (40.04), Lot 8 (38.52), Lot 10 (0.65), Lot 11 (38.49), Lot 15 (16.18), Lot 16 (22.28), Lot 17 (0.89), El/2El/2, Wl/2SEl/4 Section 24: Lot 5 (38.44), NEl/4 Township 23 North. Ranl!e 115 West. 6th P. M. Section 19: Lot 15 (40.07), Lot 16 (40.11) Section 30: Lot 5 (40.13), Lot 6 (40.15), Lot 15 (40.17), Lot 16 (23.31) Township 23 North. Ranl!e 116 West. 6tb P. M. Section 24: El/2SEl/4, SWl/4SEl/4, SEl/4SWl/4 Section 25: NWl/4NEl/4, El/2NEl/4, NEl/4SEl/4, Wl/2NWl/4, NEl/4NWl/4, Nl/2SWl/4, Lot 1 (23.18), Lot 4 (23.18), Lot 5 (23.18) Section 26: SEl/4NEl/4, NEl/4SEl/4, Lot 1 (23.18)