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HomeMy WebLinkAbout933326 PRODUCERS 88 -PAIT . OIL AND GA~ LEASE This Oil and Gas Lease ("Lease") is made effective the ~ day of AUlrust. 2007, by and between . Lillian E. Harrower. whose address is 8603 Powderhouse Road Cbevenne. Wvominl!: 82009 ("Lessor", whether one or more) and Fiwimmons, LLC. whose address IS 2201 Cabin Court Gillette, WY 82718 ("Lessee"). OtJuu,¿3 WlTNESSETIf, For and in consideration of TEN DOLLARS, the covenants and agreements contained berein, and other goo~ and valuable. con~ideration the receipt and sufficiency of which are hereby acknowledged, Lessor does hereby grant, demise, lease and let exclusively unto said Lessee, WIth ~e exclusIV~ n~ts ~or the purposes of mining, exploring by geophysical and other methods and operating for and producing thereftom oil and all gas ofwhatsoev~r nature or kind, and la~g plpelmes, telephone and telegraph lines, building tanks, plants, power stations, roadways and structures thereon to produce, save and take. c~ of s81d produ<:ts ~d the exclusIve s~rface and subsurf~ rights and privileges related in any manner to any and all such operations, and any and all other rights and pnvdeges necessary, ~cldent t~, or convement for ~e operatIon alone or conjointly with neighboring land for such purposes, all that certain tract or tracts of land situated in LINCOLN. Wyommg, descnbed as follows, to-WIt: SEE EXHIBIT" A" ATTACHED TO AND MADE A PART HEREOF FOR DESCRIPTIVE PURPOSES. and containing 2521.497 acres, more or less, (the "Premises"), ., . I. It is agreed that this Lease shall remain in force for a tenn offive (5) years from this date ("Primary Tenn") an~ as long thereafter. as .011 or gas of. whatsoever n~ture or ~d IS produced from the Premises or on acreage pooled or unitized therewith, or operations are continued as hereinafter provided. If, at the expJratIon ~f the pnmary Tenn, 011 ,or gas IS not being produced from the Premises or on acreage pooled or unitized therewith but Lessee is then engaged in drilling, reworking or other operations cal.culated to obt~ or restore production ftom the leased premises thereon, then this Lease shall continue in force so long as such operations are being continuously prosecuted. ~~tIons shall ~ considered ~. be continuously prosecuted if not more than One Hundred Eighty (180) days shall elapse between the completion or abandonment of one well and the begmnmg of operations for the drillmg of a subsequent well. If after discove¡y of oil or gas on the Premises or on acreage pooled or unitized therewith, the production thereof should cease from ~y cause after ~e primary tenn, this Lease shall not tenninate if Lessee commences additional drilling, reworking operations within One Hundred Eighty (180) days from date of cessation of production or from 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 from 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 term. Lessee may at any time or times during or after the Primary Term 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-SIXm (1/6110) of that produced and saved from 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 from 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 from said land and sold or used off the premises or in the manufacture of products therefrom, the market value at the well of ONE-SIXTH (1/6110) of the product sold or used. On product sold at the well, the royalty shall be ONE-SIXm (l/611>¡ of the net proceeds realized from such sale. All royalties paid on gas sold or used off the premises or in the manufàcture of products therefrom will be paid after deducting from such royalty Lessors proportionate amount of all post-production costs, including but not limited to gross production and severance taxes, gathering and transportation costs from the wellhead to the point of sale, treating, compression, and processing. On product sold at the well, the royalty shall be ONE-SIXTH (1/6''') of the net proceeds realized from such sale, after deducting ftom such royalty Lessor's proportionate amount of all of the above post-production costs and expenses, ifany. 4. Where gas from a well capable of producing gas is not sold or used after the expiration of the Primary Tenn, Lessee shall payor tender as royalty to Lessor at the address set forth above One Doliill' per year per net mineral acre, such payment or tender to be made on or before the wmiversary date of this Lease next ensuing after the expiration of ninety (90) days from the date such well is shut in and thereafter on or before the wmiversary 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, free of cost, gas. oil and water produced on the Premises for Lessee's operations thereon, except water ftom the weIls 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 machine¡y 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 information necessary to establish a complete chain of record title from Lessor, and then only with respect to payments thereafter made. No other kind of notice. whether actua1 or constructive, shall be binding on Lessee. No present or future division of Lessor's ownership as to different portions or parcels of the 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. Ifall 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 from 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 formations 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 simillll' to this exists with respect to such other land, lease or leases. Likewise units previously fonned to include formations not producing oil or gas, may be reformed to exclude such non-producing fonnations. The fonning or reforming 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, driIling, reworking or dewatering operations or a well shut in for want of a market anywhere 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 from 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, from time to time, with like approval, to modifÿ, 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 terms, 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 such plan or agreement, and this Lease shall not tenninate 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 therefrom 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 from 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 failure is the result of, any such Law, Order, Rule or Regulation. Any delay or interruption caused by stonn, flood, acts ofterrorism, 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 from conducting operations hereunder, such time shall not be counted against Lessee, and this Lease shall be extended for a period of time 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 form should reflect all pertinent and relevant tenns and conditions of the lease. Lessee shall have fifteen (15) days after receipt, from 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 tenns and conditions. If Lessee fails to notifÿ Lessor within the aforesaid fifteen (15) days period ofits 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 tenn of this Lease, this Lease shall terminate 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. 18. Lessee is hereby given the option of extending the primary term of this lease for an additional term of Five (5) years ftom the expiration of the original primary term. This option may be exercised in relation to all (but no less than all) of the land covered by this lease by Lessee, its successors or assigns, on or before the expiration of the primary tenn by paying the sum of Seventy Five dollars ($75.00) per net mineral acre to Lessor or to Lessor's credit in the depository named in this lease. Should this option be timely exercised as herein provided, it shall be considered for all purposes as though this lease originally provided for a tenn often (10) years. All of the provisions of this lease related to the payment of shut-in royalties shall apply equal~ to this p~ent. incJudin~ but not limited.tQ. the provisions regarding changes of ownership. Rt:.CEIVt:.D 9/21/20u7 at 3:19 PM RECEIVING # 933326 BOOK: 673 PAGE: 23 JEANNE WAGNER uuuu~--r IN WITNESS WHEREOF, this instrument is executed as of the date ftrst above written. , '&;~/ f£t! (J/INW-P~ ~~ E. Harro er STATE OF~\'{')\(')~ COUNTY OF ~~CV'\\'\J. q } UNIFORM ACKNOWLEDGEMENT ss. } BEFORE ME, the undersigned authority, a Notary Public, on this day personally appearedlllhQ r\ Ll::1 ( t> (jJe \2 known to be the person(s) who executed this within and foregoing instrument, and acknowledged to me that he/she executed the same. , tome Given under my hand and official seal, this the .:?6 day of A U ~ ,2007. My Commission EXPireS:~ Nwn'~bl~~ Address: I' .. f'C ... . . cru.~ lli~ ¿> QOO9 COUNTY OF LARAMIE MY COMMISSION EXPIRES JUN. 17, 20011 v..."~.~~~, 000025 EXHIBIT " A" ATTACHED TO AND MADE A PART OF THAT CERTAIN OIL, GAS AND MINERAL LEASE DATED AUGUST 27, 2007 BETWEEN, LILLIAN E. HARROWER AS LESSOR, AND FITZSIMMONS LLC. AS LESSEE. . Townshio 24 North. Rane:e 119 West. 6th P. M. Section 6: Lots 49 and 50, that part of Lot 18, lying Westerly of the centerline of the Bear River. Section 7: Lots 12,23,24 and that part of Tract 121 lying Westerly ofthe centerline of the Bear River. Townshio 24 North. Rane:e 119 and 120 West. 6th P. M. Those portions of Tracts 85 and 86 lying Westerly of the centerline ofthe Bear River. Townshio 24 North. Rane:e 120 West. 6th P. M. Section 1: S1/2SE1/4, Tracts 41A, 41C, 41D, 45 and 130. Section 3: Lot 9, East of property line/ fence line as described by Surveyor Scherbel, LTD on the Map recorded in the Lincoln County, Wyoming Clerk's Office as Map 21C on January 5, 1994. Section 4: Lots 5 and 10. Section 9: Lot 7, South of property linel fence line as described by Surveyor Scherbel, LTD on the Map recorded in the Lincoln COWlty, Wyoming Clerk's Office as Map 21C on January 5, 1994. Section 12: NE1/4. Section 14: NW1/4NW1/4. Townshio 25 North. Rane:e 119 West. 6th P. M. Section 21: Lots 30, 32 and 34. Section 28: Lots 2, 4,5, 7, 11, 13, 16,34 and 40 also that part of Tract 61, lying West of the Oregon Shortline Railroad Right of way and that part of Tract 129, lying Westerly of the centerline of the Bear River. Section 29: Lots 34, 36, 37 and Tract 56 and Tract 58. Section 31: Lot 5, North of property line/ fence line as described by Surveyor Scherbel, LTD on the Map recorded in the Lincoln County, Wyoming Clerk's Office as Map 21C on January 5, 1994. Section 30: Tract 53. Section 32: Lot 7. Section 33: Lots 8, 9, 14, 15,25,26,32 and 42. Sections 20 & 29: Tract 59. Sections 29 & 32: Tract 57. Sections 21, 28, & 29: Tract 60 and that part of Tract 76, lying Westerly of the centerline of the Bear River. Sections 19 & 20: S 1/2 of Tract 80B and the S 1/2 of Tract 81. All of the aforesaid containing 2521.497 acres, more or less, Being more particularly described in that certain Assignment of Agreement of Sale of Real Estate dated August 22,2001 from John Russell Thornock and wife Emma Lucy Thornock to John Russell Thornock and Emma Lucy Thornock, Trustees as recorded in Book 471, Page 447 of the Photo Records of Lincoln County, Wyoming.