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and to extract, remove, store, transport, and market for its or their account oil, gas and associated liquid
hydrocarbon substances in or from said described premises, and to drill, construct, maintain and use
upon, within, and over said described premises all oil wells, gas wells, derricks, machinery, tanks,
drips, boilers, engines, pipelines, power and telephone lines, roadways, water wells, and, without
limitation by reason of the 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 liquid hydrocarbon substances under or produced from any portion of the described
premises or under or produced from any portion of the unit area created under a unitization agreement,
together with the right to remove said facilities and the right to use such water as may be needed from
the described premises, not including water from Landowner's wells.
Section 2. UPLRC agrees, so long as it is receiving oil and /or gas production from or oil
and /or gas royalties upon production from the described premises or allocated thereto under the
provisions of a unitization agreement, to pay or cause to be paid to the Landowner in cash the value
(which shall never be greater than the amount realized by UPLRC from the sale of such production) on
the premises of two and one -half percent (2 1/2 of all the oil and gas and associated liquid
hydrocarbons hereafter produced, saved, and marketed therefrom or allocated thereto as aforesaid,
except oil and gas and associated liquid hydrocarbons used in operations on the premises or used under
the unitization agreement, and except that as to casinghead gasoline and other products manufactured
from gas there shall be deducted the cost of manufacture; provided, however, that during any time the
described premises or any portion thereof are included within the boundaries of a participating, pooled,
or communitized area, and there is no provision for the payment of royalties to UPLRC but it partici-
pates in the production from the pooled, communitized, or unit area as a working interest owner, then
the two and one -half percent (2 1/2 above set forth shall be applied to that percentage of the total
production from such area which is allocated to the described premises. Any payment made to the
Landowner pursuant to this Section 2 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 UPLRC for treating
the production to make it merchantable, and for gathering, transporting and compressing the production
prior to delivery to the purchaser at the point of sale or use.
When production of oil from lands under several surface ownerships is commingled in one central
tank setting for practical operating reasons, periodic individual well tests may be made to compute the
quantities of commingled oil properly allocable to each well, and the two and one -half percent (2 1/2
payment provided herein shall be payable upon the quantities apportioned to each well as reported to
UPLRC in full satisfaction of the obligations of UPLRC under this Section 2.
Section 3. Nothing herein contained shall be construed as a covenant to drill by UPLRC, its
agents, lessees, licensees, successors, or assigns, or by any operator or unit operator, or as a grant to
Landowner of oil or gas rights or rights in other associated liquid hydrocarbons.
Section 4. UPLRC, its agents, lessees, licensees, successors and assigns, including the
operator or unit operator under a unitization agreement, shall be required: (a) to pay for all damage to
Landowner's lands, buildings, and growing crops caused by the erection or construction of facilities to
be used in connection with oil or gas or associated liquid hydrocarbon operations; (b) to bury all
pipelines below plow depth where such lines cross cultivated land; and (c) to construct gates or, at its
option, install cattle guards where necessary for crossing fenced land in connection with exploration,
development, or producing operations and, where an election has been made to construct gates in lieu
of cattle guards, to keep such gates in repair and closed. In no event shall the amount of damages exceed
the value (as determined by the use of the land at the time the damages are sustained) of that portion of
the Landowner's lands actually used by UPLRC, its agents, lessees, licensees, successors or assigns,
for the location of its facilities. The fact that damages have not been agreed upon shall in no way delay,
restrict, impair or diminish the right of UPLRC, its agents, lessees, licensees, successors and assigns
to commence or conduct oil and gas operations on the described premises.
Section 5. Other than the payments to be made as aforesaid, the Landowner shall not be
entitled to any other or additional payments as a result of the conduct of the operations described in
Section 1 hereof, and Landowner will claim no right, title or interest in or to the oil, gas and associated
liquid hydrocarbon substances in the described premises.
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SIM 401.1.1
ATTEST:
BY: &-iL
STATE OF
0866107
t
Secretary
My Commission Expirl
eft
v1,4 1 (11,
COUNTY OF 1 G1 a_
The foregoing instrument was acknowledged before me this e)`1 day of (Aka -'c 2000,
by 1 as Vt'�if���.1f of
l y 141 6( Li t-« t,1 rl .t L i 6 t.,,, f. t,� corporation, on behalf of the
corporation. bUtiA
No ry Public
STATE OF TEXAS
ss
COUNTY OF TARRANT
My Commission Expires:
CATHY ji.
Notary
STATE OF EE:=;:
FLYING W LAND A LIVESTOCK COMPANY
BY
ss
.-tea
The foregoing instrument was acknowledged before me this L day of
by JAMES L. NEWCOMB, as Attorney in Fact of UNION PACIFIC LAND
CORPORATION, a Nebraska corporation, on behalf of the corporation.
4
Taxpayer Identification Number
Box 310, Big Piney, WY 83113
_Oi4'' (oe
236
2000,
SOURCES