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HomeMy WebLinkAbout940696 88 - PAID UP Rev. 5-60, No. 2-4-89 Rev 2-12-08 Kt:l,;t:IVt:U l/¿l/¿UUö at ¿:,jU ¡-'IVI RECEIVING # 940696 BOOK: 700 PAGE: 455 JEANNE WAGNER LINCOLN COUNTY CLERK, KEMMERER, WY Re/urn recorded documen//o; LandPro Energy, LLC 1250 S. Buckley Rd., Suite 1-250 Aurora, CO 80017 OIL AND GAS LEASE COG4S5 AGREEMENT, Made and entered into the 10th day of May .2008, by and between Norman M. Harrower, a single man whose address is 8374 County Rd. 6 Southwest, Stewartville, MN 55976 . hereinafter called Lessor (whether one or more) and LandPro Energy. LLC whose address is 1250 S. Buckley Rd.. Suite 1-250. Aurora. Colorado 80017 . hereinafter called Lessee: WITNESSETH, That the Lessor, for and in consideration often and more dollars, cash in hand paid, the receipt of which is hereby acknowledged, and the covenants and agreements hereinafter contained, has granted, demised, leased and let, and by these presents does grant, demise; lease and let exclusively unto said Lessee, the land hereinafter described, with the exclusive right for the purpose of mining, exploring by seismic, geophysical and other methods, and operating for and producing therefrom oil and gas of whatsoever nature or kind, with rights-of-way and easements for laying pipelines and erection of structures thereon to produce, save and take care of said products, all that certain tract ofland situated in the County of Lincoln , State of Wyoming ,described as follows, to-wit: TWP. 24N, RNG. 119W: Sections 5, 6: Tract 87, described by resurvey as Lots 21, 24, 25, 26,32,33,36, & 37, originally described as part of the NE/4SW/4, Nl/2SE/4. 119W: Section 17: Tract 84, described by resurvey Lots 25, 28, 29, 33 and Lots 20, 29 of section 18, originally described as S/2SW/4. TWP. 25N, RNG. l--'f it¡ and containing 203.62 acres, more or less, (including any interests therein which Lessor may hereafter acquire by revision. prescription or otherwise) In addition to the above-described leased premises, this lease also covers accretions and any small strips or parcels of land now or hereafter owned by Lessor which are continguous or adjacent to the above described leased premises, and in consideration ofthe herein stated consideration, Lessor agrees to execute at Lessee's request any additional or supplemental instruments for a more complete or accurate description of the land so covered. 1. It is agreed that this lease shall remain in force for a tenn often (5) years from this date and as long thereafter as oil or gas of whatsoever nature or kind is produced from said leased premises or on acreage pooled therewith, or drilling operations are continued as hereinafter provided. If, at the expiration of the primary tenn of this lease, oil or gas is not being produced on the leased premises or on acreage pooled therewith but Lessee is then engaged in drilling or re-working operations thereon, then this lease shall continue in force so long as operations are being continuously prosecuted on the le¡¡sed premises or on acreage pooled therewith; and 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 said land or on acreage pooled therewith, the production thereof should cease from any cause after the primary tenn, this lease shall not tenninate if Lessee commences additional drilling or re-working operations within ninety (90) days from date of cessation of production or from date of completion of dry hole, If oil or gas shall be discovered and produced as a result of such operations at or after the expiration of the primary tenn ofthis lease, this lease shall continue in force so long as oil or gas is produced from the leased premises or on acreage pooled therewith. 2. This is a PAID-UP LEASE. In the event that payments are necessitated by other provisions ofthis lease, Lessee shall pay or tender such payments DIRECT TO LESSOR AT THE ABOVE ADDRESS, or its successors, which shall be Lessor's depository agent for receiving payments regardless of change in the ownership of said land. All payments or tenders may be made in currency, or by check or by draft, and such payments to Lessor or to the depository by deposit in the US Mail or other mail carriers on or before the due date in a stamped envelope addressed to the Lessor at the last address known to Lessee shall constitute proper payment. If the depository should liquidate or be succeeded by another institution or for any reason fail or refuse to accept payment hereunder, Lessee shall not be held in default for failure to make such payment until 60 days after Lessor has delivered to Lessee a proper recordable instrument naming another institution as depository agent to receive payment. If on or before any due date lessee in good-faith makes an erroneous payment by paying the wrong person, the wrong depository, or the wrong amount, Lessee shall be unconditionally obligated to make proper payment for the period involved and the lease shall continue in affect as though such payment had been properly made, provided that proper payment shall be made within 30 days after receipt by a Lessee of written notice ofthe error from Lessor, accompanied by any documents and other evidence necessary to enable Lessee to make proper payment. Lessee may payor tender any payment at any time in advance of its due date to the Lessor then known to Lessee as provided in Paragraph II and such payment or tender shall bind all persons then or thereafter claiming any part of such payment. In consideration of the down cash payment, 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 said land 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 obligation thereafter accruing as to the acreage surrendered, 3. in consideration of the premises, said Lessee covenants and agrees: I ". To deliver to the credit of Lessor, free of cost, in the tanks atthe wellhead, the equal one-sixth íl® part of all oil produced and saved from the leased premises. 2nd. To pay Lessor on gas and casinghead gas produced from said land (I) when sold by Lessee, one-sixth íl® of the net proceeds derived from such sale or (2) when used by Lessee off said land or in the manufacture of gasoline or other products, the market value, payable monthly at the prevailing market rate, at the mouth of the well, on one-sixth of such gas and casinghead gas. Lessor's interest, in either case, to bear one-sixth of the cost of compressing, dehydrating and otherwise treating such gas or casinghead gas to render it marketable or usable and one-sixth of the cost of gathering and transporting such gas and casinghead gas from the mouth of the well to the point of sale or use, and one-sixth of the cost of ad valorem taxes and production, severance, or other excise taxes. 7- ¡t¡ 4. Where gas from a well capable of producing gas is not sold or used, Lessee may pay or tender as royalty to the royalty owners one dollar per year pernet royalty acre retained hereunder, such payment or tender to be made on or before the anniversary date ofthis lease next ensuing after the expiration of ninety (90) days from 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. If such payment or tender is made, it will be considered that gas is being produced within the meaning of this lease. 5. If said Lessor owns a less interest in the above described land than the entire and undivided fee simple estate therein, then the royalties (including any shut-in gas royalty) herein provided for shall be paid to said Lessor only in the proportion which Lessor's interest bears to the whole and undivided fee. 6. Lessee shall have the right to use, ûee of cost, gas, oil and water produced on said land for Lessee's operation thereon, except water from the wells of Lessor. 7. When requested by Lessor, Lessee shall bury Lessee's pipelines below plow depth. 8. No well shall be drilled nearer than two hundred (200') feet to the house or barn now on said premises without written consent of Lessor. 9. Lessee shall pay for damages caused by Lessee's operations to growing crops on said land. 10. Lessee shall have the right at any time to remove all machinery and fixtures placed on said premises, including the right to draw and remove casing. II. The rights of 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 from 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 said land 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 ofthis lease is assigned, no leasehold owner shall be liable for any act or omission of any other leasehold owner. 12. 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 land described herein and as to anyone or more of the fonnations hereunder, 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 the 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 reformed to exclude such non-producing fonnations, The fonning or refonning of any unit shall be accomplished by Lessee ~l COG4S6 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 or reworking operations or a well shut in for want of market anywhere on a unit which includes all or a part of this lease shall be treated as if it were production, drilling or reworking 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 on production ftom the unit so pooled royalties only on the portion of such production allocated to this lease; such allocation shall be that proportion of the unit'production that the total number of surface acres covered by this lease and included in the unit bears to the total number of surface acres in such unit. In addition to the foregoing, Lessee shall have the right to unitize, pool or combine all or any part of the above described lands 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 tenns, 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 such plan or agreement, and this lease shall not tenninate or expire during the life of such plan or agreement In the event that said above described lands, 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 ofIand 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 ofIand; and the 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, 13. All express or implied covenants ofthis lease shall be subject to all Federal and State Laws, Executive Orders, Rules or Regulations, and this lease shall not be tenninated, 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. 14. Lessor hereby warrants and agrees to defend the title to the lands herein described. and agrees that the Lessee shall have the right at any time to redeem for Lessor, by payment, any mortgages, taxes or other liens on the above described lands, 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 described herein, insofar as said right of dower and homestead may in any way affect the purposes for which this lease is made. as recited herein. 15. Should anyone or more of the parties hereinabove named as Lessor 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 tl1Ìs lease, shall mean anyone or more or all of the parties who execute this lease as Lessors. All the provisions ofthis lease shall be binding on the heirs, successors and assigns of Lessor and Lessee. 16. Leesee is hereby giving the option of extending the primary tenn of this lease for an additional tenn of Five (5) years ftom the expiration of the original primary tenn. 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 an amount equal to the original bonus paid to Lessor, its successors or assigns. IN WITNESS WHEREOF, this instrument is executed as of the date first above written. ~Yn"~ Norman M. Harrower ACKNOWLEDGMENT STATE OF MINNESOTA COUNTY OF !/!ß1-1-t-o.:G.d ) )SS ) BEFORE ME, the undersigned, a Notary Public, in and for said County and State, on this (~Ddvday of IJ~ J . 2008, personally appeared Nonnan M. Harrower. a single man , to me known to be the identical perso e/cribed in and who executed the within and foregoing instrument of writing and acknowledged to me that he executed the same as his free and voluntary act and deed for the uses and purposes therein set forth. IN WITNESS WHEREOF, I have hereunto set my hand and affixed by notarial seal the day and year last above written. My Commi,,'on "",ire" Ie? tf" U', "1-1,,, H ""') ~ Notary Public Printed Name: ShQt'"o,1... m<2.ob4 ¡¿- Residing at ~ -'" h u..4">--0-?1 lL ..Jv (Seal) I , C{ rE /4 ~ þ~) I~ !i~'l'7 ç.. SHARON THEOBAlD Notary PUbllOo-Mlnnesota My Comm. Expires Jan. 31, 2010