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HomeMy WebLinkAbout937201 OIL AND GAS LEASE 000044 This Oil and Gas Lease ("Lease") is made effective the ~ day of January. 2008, by and between Monea MatIJews. a married woman dealinll in her sole and seoarate DrODertv. whose address is 619 North 3500 West Vernal. Utah 84078{"Lessor", whether one or more) and Fitzsimmons, LLC. whose address is 2201 Cabin Court Gillette, WY 82718 ("Lessee"). WITNESSETH, For and in consideration ofTEN 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 of land situated in LINCOLN. Wyoming, described as follows, to-wit: SEE EXHIBIT "A" ATTACHED TO AND MADE A PART HEREOF FOR DESCRIPTIVE PURPOSES and containinl! 851.14 acres, more or less, (the "Premises"). 1. It is agreed that this Lease shall remain in force for a term offive (5) years fi:om this date ("Primary Term") 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 Term, oil or gas is not being produced fi:om 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 from 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 One Hundred Eighty (180) 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 fi:om any cause after the primary term, this Lease shall not terminate if Lessee commences additional drilling, reworking operations within One Hundred Eighty (180) days from date of cessation of production or ftom date of completion of dIy 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 Term, this Lease shall continue in force so long as oil or gas is produced fi:om 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-BIXTH (1/6·') of that produced and saved fi:om 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 marlcet price therefore prevailing for the field where produced on the date of purchase; (b) on gas and the constituents thereof produced fi:om said land and sold or used off the premises or in the manufacture of products therefi:om, the mlilket value at the well of ONE-SIXTH (l/6~ of the product sold or used. On product sold at the well, the royalty shall be ONE-SIXTH (1/6·') 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 therefi:om will be paid after deducting fi:om such royalty Lessors proportionate amount of all post-production costs, including but not limited to gross production and severance taxes, gathering and transportation costs fi:om the wellhead to the point of sale, treating, compression, and processing. On product sold at the well, the royalty shall be ONE-SIXTH (1/6Ib) of the net proceeds realized fi:om such sale, after deducting fi:om such royalty Lessor's proportionate amount of all of the above post-production costs and expenses, if any. 4. Where gas ¡¡-om 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 fi:om 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 fur Lessee's operations thereon, except water ¡¡-om 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 information necessary to establish a complete chain of record title fi:om 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 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. 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 fi:om 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 similar to this exists with respect to such other land, lease or leases. Likewise units previously formed to include formations not producing oil or gas, may be reformed to exclude such non-producing formations. The forming or . reforming of any unit shall be accomplished by Lessee executing and filing of record a declaration of such unitization or reformation, 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 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 formations 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, ¡¡-om time to time, with like approval, to modifY, change or terminate any such plan or agreement and, in such event, the terms, conditions and provisions of this Lease shall be deemed modified to conform 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 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 therefi:om 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 formally 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. J2. 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 storm, flood, acts of terrorism, act of God or other event of force 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 fi:om 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 term 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 form to be utilized which form should reflect all pertinent and relevant terms and conditions of the lease. Lessee shall have fifteen (15) days after receipt, ¡¡-om 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 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 jurisdictioll 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 oftime 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 from 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 term by paying the sum of Fifty dollars ($50.00) 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 term often (IO) years. All of the provisions of this lease related to the payment of shut-in royalties shall apply equally to this payment, including, but not limited to. the Drovisions rel!arrlina "nDnges of ownership. RECEIVED 2/26/2008 at 3:07 PM RECEIVING # 937201 BOOK: 688 PAGE: 44 JEANNE WAGNER LINCOLN COUNl RK, KEMMERER, WY IN WITNESS WHEREOF, this instrument is executed as of the date first above written. 000045 Mo ea Mathews, a arried woman dealing in her sole and separate property. STATE OF (lhA LLi~ } UMŒORMACKNOWLEDGEMENT 88. COUNTY OF } BEFORE ME, the undersigned authority, a Notary Public, on this day personally appeared Monea Mathews. a married woman dealing in her sole and seDarate pr<>perty . to me known to be the person(s) who executed this within and foregoing instrument, and acknowledged to me that he/she executed the same. +k. ~ Given under my hand and official seal, this the (5 day of .... ).Nl o...~=:.-..> 2008. Name Public: Address: ~c~ 1 L{ 'ì L.. ilJ1lÁ.i \ _ My Commission Expires: -1'YlÔ j, :20/0 EXHIBIT" A" 000046 ATTACHED TO AND MADE A PART OF THAT CERTAIN OIL, GAS AND MINERAL LEASE DATED JANUARY 30, 2008 BETWEEN, MONEA MATHEWS, A MARRIED WOMAN DEALING IN HER SOLE AND SEPARATE PROPERTY. AS LESSOR, AND FITZSIMMONS LLC. AS LESSEE. Township24 and 25 North, Ranf!e 119 West, 6th P. M. All of Tract 45, LESS AND EXCEPT: that part described as follows: Beginning at a point designated as 2/45 of Tract 45, Township 25 North, Range 119 West, 6th P. M., Wyoming, and running thence West 302 feet, more or less, to the center of the present state highway; thence South 11 °55' East along the middle of said state highway to the West line of Tract 42; thence North to point number 5/45; thence East 39.75 chains to comer number 4; thence North 0°54' East 19.88 chains to comer number 3; thence West 39.90 chains to comer number 2 and point of beginning. LESS AND EXCEPT: that part of Tract 45 Township 25 North, Range 119 West, 6th P. M. Wyoming, described as follows: Commencing at Point Number 6/45 of Tract 45, being the Southeast comer thereof; thence West along the South line of said Tract to the Southwest comer thereof; thence North along the West line of said Tract 80 rods; thence East to the center line of the present Wyoming State Highway; thence Southeasterly along the center line of said highway to a point where said center line crosses the South line of Tract 42; Thence West to the place of beginning. That part of Tracts 42 and 45, Township 25 North, Range 119 West, 6th P. M. described as follows: Commencing at Point Number 6/45 of Tract 45, being the Southeast comer thereof; thence West along the South line of said Tract to Point Number 7/45, being the Southwest comer thereof; thence North along the West line of said Tract 80 rods; thence East to the center line of the present Wyoming State Highway; thence Southeasterly along the center line of said highway to a point where said center line crosses the South line of Tract 42; Thence West to the place of beginning. Commencing at comer Number 8/45 in Tract 45, Township 25 North, Range 119 West, 6th P. M. and running thence North 9° West 527 feet, thence North 42° East 104 feet, thence North 37° West 104 feet, thence West 184 feet to the Oregon Short Line Railroad right of way, thence South 10°39', East 693 feet along the East Boundary ofthe Oregon Short Line Railroad Company's right of way, thence South 89°30' East 130 feet to the place of beginning. All of Tract 48, Township 25 North, Range 119 West, 6th P. M. All of Tract 69, Township 25 North, Range 119 West, 6th P. M. A parcel of land situate within the westernmost portion of Resurvey Tract Number 104 of Township 24 North, Range 119 W 6th P.M. described in particular as follows, Beginning at Comer 3 of said Tract 104; thence south 89"40' East, 13.03 chains along the southern boundary of said Tract 104 to the Western boundary ofland deeded to the San Francisco Sulphur Company as described on page 68 of Book 18 of Lincoln County deeds; thence North 27"3 'East, 2.97 chains to a point on the northeasterly bank of the Kinney Inigation Ditch, a meander point on said western boundary; thence meandering northerly on the northeasterly bank said irrigation Ditch; North 6201' West 9.03 chains; North 26'25' West 7.76 chains; North 1103' West, 8.81 chains; North 6036', 10.86 chains to the northern boundary of said Tract 104; thence South 89050' West, 2.51 chains to Comer No.4 of said Tract 104; thence South 33.18 chains to the place of beginning. That part of Tract 105, Township 24 North, Range 119 West of the 6th P.M. That part of Tract 105. Township 24 North, Range 119 West; lying East of the present Wyoming State Highway known as 30 North excepting a parcel of land situate within the boundaries of Resurvey Tract No. 105, Township 24 North, Range 119 West, 6th P.M.; said parcel of land forming a portion of the right of way for U. S. Highway No. 30N, as shown in particular upon the plat of the survey for F.A.P. No. 34-Sec. "A" by the Wyoming State Highway Department, as follows, to wit: Beginning at a point on the Southern boundary line of said Tract 107 from whence Comer No. 2 of Tract 105 of said T. & R. Bears S. 89"20' East 1258.4 feet; thence North 89'20' West 153.4 feet; thence North 11"58' West, 2211.9 feet, thence North 89"50' East, 153.2 feet along the Northern boundary line of said Tract 105; thence south 11 ° 5 8' East, 2214.4 feet to the place of beginning. A parcel ofland situated within Tract 106 ofTQwnship 24 North, Range 119 West of the 6th P.M., described in particular as follows, to-wit: Beginning at Highway fence on West side of Highway 30N and 30 feet North of Smiths Fork River bank, running 125 feet west, thence North 300 feet, thence East 125 feet, thence south 300 feet to place of beginning, with right of way privileges to enter above described land through driveway to Tract 106.