HomeMy WebLinkAbout902086 PAID-UP
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T' THIS AGREEMENT, made and entered into this 30th day of June, 2004, by and belden John R~nald Thompson, I~ividually, and as Padner of
nompson Land and Livestock Company, a Wyoming Padnership, and John ROnqld' Thompsdnj'.as~'A~orney-ln-Fact for Norene
Thompson, also known as Norene M. Thompson, also known as Norene Murdock Thompson: sianleTGehe Thompson, Jr., William T.
Thompson, Don Mark Thompson, Ted Harold Thompson and Carole Ann Thompson Goodman, Padners of Thompson Land and Livestock
Company, a WyomingPadnership o~ P.O. Box 130, Cokeville, Wyoming 83114, hereina~er called lessor (whether one o~ more), and Hanson & Strahn,
Inc. of P.O. Box 3020, Cheyenne, Wyoming 82003, hereinafter called lessee:
WITNESSETH:
1. That lessor, for and in consideration of- -Ten-- dollars ($ '10.00' ) in hand paid, receipt of which is hereby acknowledged, and of the agreements of lessee hereinafle~
set.~od~,,he[e~y grants, demises leases an~ let~ v~ y unlo lessee the andj described below for Ihe purpose ol investigating, prospecling, ex Ioring (by geophysical and olher
memods), drilfing mininq, o~eralin9 ~or and producing oil or gas or Doth (as deined below), t~ether wilb the right to construct and mainlain pipeff~es telephone and eteclric lines
tanks, ponds, roadways, plants, equipment, and structures thereon'to produce, save and take ~re of said oil and gas (wh ch right shall include specifically' a right-o[ way and easemen{
for inqress to and egress from said lands by lessee, or its ass gnees, agents or permi~ees, necessa~ to or associaled with the construction and mai~ltenance ol such pipelines telephone
and electric lines, tanks, ponds roadways plants, equipment, and structures on said lands to produce, save and take care of the oil and gas), and the exclusive righito inje~l air gas
water, brine and oO~er fluids fr~m any source nlo the subsuflace s rata, and any and all other rights and privileges necessa~, incident lo or convert ertl for lhe economical operaiion
said land, alone or conjointly wth neghboring land, for the production, saving and taking care of oil and gas and lhe njec on of air, gas waler, brine, and olhe, fluids inlo
subsuflace strata, said lands bein9 situated in the Coun~ of Lincoln , State of Wyomin~ , described as follows, to-wit:
Township 22 Nodh, Range 117 West, 6~, P.M.
- Section 29: E%NE%, SEV4
~ Section 32: NE%
Section 33: SW%NW%, NW'/4SW%
In addition to the land described above essor herebygrants, leases and ets excus rely unto lessee, {o lhe same exlent as if specifically described lands which are owned or
claimed by lessor by one ol Ihe following reasons: (1} al ands and rights acquired or re~inedby lessor by avulsion, accretion, ~ellction or olhe~ise as ll~e resull ota change ~ e
boundaries or centerline of any river or stream traversing or adjo n )g ~e ands describ~ above; (2) all dparian lands and rights, which are or r ~ay be incide~d appudena~ t related
a~ri~u ed to essor in any lake stream or river traversing or adjoin ng the a ~ds described a~ve by w~ue ol lessoCs ownershid nf fh~ lRnd rl~-'~ ........ ~. ~ /~, L,,',- , ~ , '. , ·
, ' ............... r ........... 5~/lo~u auuv~; ~) alii la~S Incluo6~ IR ally
road, easement or n~ht-of-way traversing or adjolmng the lands descr bed above which are or may be incident, appurtenant, related or a~rlbnled (o lessor by vidue o[ lesso(s ownership
of the land described above; and (4) all strips or tracls of land adjacent or con guous to the lands described above owned or acquired by lessor through adverse possession o~ other
similar statules of ~e state in which lhe lands are located.
or tess. For lhe purpose o[ catculaling payments provided lot herein, it shall be deemed thai the lands covered by {his lease con,in 640.00 acres, whelher lhere aclually be more
The term oil as used in this lease shall be interpreted Io include any quid hydroca~on substances which occur naturally in the eadh including drip gasoline or olber nalnral
condensate re~vered [rom gas without reso~ to manufacturing process. Theierm gas as used in h s ease shall be inlerpretedto include a~y subslance, differ combuslible or non-
combustible, which is produ~d in a nalural state from the eadh and wh ch maintains a gaseous or ratified slato a( o~dina~ temperature and pressure conditions, including bul nol limiled
to helium, ni r~en, caren dioxide, hydrogen sulfide, coal ~d me,and gas, casinghead gas and sulphur.
Subject to the other provisions herein conta ned, [his lease she rema n n force for a term of five (5) years from this dale (herein called "prima~ lerm") and as long thereafter as
oil and~as, or either ol lhem is ~roduced from ~e eased Prem SdS or dd ing opera ohs are conlinuousl~ prosecu ed For pu poses of lhis lease a well compleled ~or Ihe p~oduction
coalbeemethane gas shall ~e deemed to be producng ~as under [his lease at all times when dewaler~ng of Ihe coal seams ~rom which the co~lbed melhane gas w I be p[oduced is
occurring. For purposes of this lease, "drilling operations shall include operations for the drilling o~ a new welt and operations for the reworking deepening or plugging back ola well or
hole or other operations conducled in an effo~ to establish, resume or re-es{ablish production o[oil and gas; ddltingoperal ohs shall be considered lo be "conlinuousty proseculed" il not
more than one hundred ~enty (120) days shal elapse belden the comp eton and abandonment ol one welt o~ole and the commencemenl ol dulling operations on ano~e~ well
hole; drilling operations shall be deemed to be commenced for a new we I at such time as essee has begun the construction of the wellsite Iocalion or the road which provides access
the wellsite location and so long as operations are being diligenlly proseculed; and drlling operations shall be deemed to be commenced w ~I~ respect to ~eworking deepening p uggJng
back or olher operations conducted in an e~od to resume or re-es~blish production o~ o andgas al such imes as lessee has t )e requ site equipment lot suc ~ operations al lhe welFshe.
2. The lessee shall deliver to the credit of ~e lessor as royal~, free ol cost, n the p pe ne to which lessee may connect its wells the equal one eighlh (1/8) pad of all oil produced
an~ savff¢ ~ro~ th~ I~s~d premises, or lessee may from time to time al ils option purchase any royalb oil in ils aossession oavin~ {he market ndce lhe~eof r,r~,~il;~, fr,~
al like g~ade
and grav~[y ~n the ~e[a where proouced on the date ol purchase. ' ..... ~ ........ ~ ......
The lessee shall pay lessor, as royal~, on gas including casinghead gas or other gaseous substances produced [rom the leased premises and sold or used off Ihe p~emises
used in the manufacture of gasoline or o~er producls the market value at ti e well of one-e~h~ (1/8) of lhe g~s sold or used provided thai on gas sold the royalty shall be o~e e
(1/8) o[ the amount realized from such sale. The amount realized from the sale of gas shall be ~e pnce established by the ga~ sales conlract en]ered inlo in good taitb by lessee and a
gas purchaser tot such term and under such conditions as are customa~ n the ndust~ "Pr ce" sha l mean the nel amount received by lessee a~er giving effect Io applicable regulate~
orders and a~er application of any applicable price adjustments specified in such contract or r~ulato~ o[ders ~ the evenl lessee compresses, Ireats, purifies or dehydrales such gas
(whether on o~ o~ [he leased premises) or transpods gas off the leased premises, lessee in computing royalty hereunder may deduct from such price a reasonable charge ¢o~ each of
such lunctions pedormed.
3. This is a paid-up lease and all cash consideration first recited above and annual rentals have been paid to lessor in advance to keep ~is lease in lull force and e~fecl throughout
the prima~ term. In consideration of the payment of such cash considerat on and advan~ of annua ten a s, lessor agrees that lessee shall not be obligaled, except as oihe~wise provided
herein, to commence or continue any operations during the prima~ term. Lessee mayal any ~me or times dudng or after Ihe prima~ term surrender Ibis lease as ~o all or any ~odion
the land described above, and as to any strata or stratum, by dehvering to lessor orby filing of record a release or releases, and be relieved of all obligations Iherea~er accruH)g
acreage surrendered.
4. Any payments required to be made lo lessors pursuant to this lease, other than the payment of royalties may be paid by lessee to lhe essor or lo lesso(s credit in Ibe
Bank, at PAY DIRECT TO LESSOR (or ils successor or successors, or any bank
~?~?r~[~L t~,~c?,~?~ ~ business as~els or ~n,y pad ~he{eol, by ~ur?.hase or ~~ s~al] conlinue as lhe de~sito~ ,egardless of changes in
~ a,,F u, ~a,u ~auu u, u~c u~ auu ga~. ~ sucu payments may De made Dy casR, CR6CK or QraR, m~Jl6Q O¢ aelivere~ on or De[Or6 the due da 6 lot Ihat paymell[. Any payn eR
made shall be binding on the heirs, devisees, executors, administrators, and personal represen~tives of lessor and on lesso¢s successors in i~teresl or on lesso['s assigns.
5. I[, at the expiration of the prima~ term of ~is lease, oi or gas s not be ng produced from the leased premses but lessee is then engaged in drilling operations, Ibis lease sbalt
continue in force so tong as drilling opera{~ons are continuously prosecuted; and f production of oil or gas resulls fro ~ a~y such dd[lingoperalions lhis lease shall conlinue in lorce so
long as oil or ~as shall be produced lrom the leased premises, tf a~er the expiral~on of the prma~ term of this lease production on ~e leased p~emises should cease for any cause,
this lease sha~l not terminate if lessee is then engaged in dr ng ~erations or within one hundred~emy (120) days'a~er each such cessation ol production commences or resumes
ddlling operations, and this lease shall remain in force so long as dn ing ope~alons are continuously prosecuted, andif production results therefrom, [hen as long lhereafter as oil or gas
is produ~d from the leased premises.
6. If at any time eider before or a~er the expirafion of the prima~ term of Ih s ease, there is a well capable o~ producing oil or gas on the lands covered by this lease, or on other
lands with which lands covered by Ibis lease are pooled or unilized, but ihe we s shut- n, whe~er belore or aller production therefrom, and this lease is not being maintai~ed
as ~rovided herein, this lease shall not terminate (unless released by lessee) and it shall nevedhe ess be co s ~ ered t al oil or gas is being produced f om lands covered by Ibis lease
dunng all times while the well is so shuNn. Lessee shall use reasonable diligence [o market the oil or gas ca, able of being produ~d [rom such shut in well bul shall be under ~o
obligation to markel the oil or gas under terms conditions or circumslances which, n essee's judgment exe~cisedin good faith, are unsafisfaclo~7. When Ihe lea~e is conlinued in ~orce
in th~s manner, lessee shall pay or tender to the lessor or lessoCs successors or assigns, an amount equa Io $1 00 per year per net. minera acre covered by the lease. Such paymenls
shall be made on or before the shuFin royalty payment date, as defined below, next occurr ng a~er the expiration of one hundred ~enty (120) days lrom lhe date Ihe well was shu(h),
unless prior to such date oil or gas from the well ~s sold or used or Ihe lease is othe~ise maintained as Frovidad herein. In like manner, on o~ be[o~e each succeedin~ shulJn ~oyally
payment date while such well remains shut-in, lessee shall make payment of shut-in royalty in the same a ount and manner. The term "sbu roya ly paymenl date shall mean Ihe
anniversa~ date o[ this lease. An~ shut-in royaltypaymenl may be made by cash, dra~ or check na ed or te ~ ered on or before lhe shut- n roya ly date Lessee's lailu~e [o pay o~ tender
or proper y pay or tender, any SUCh sum shal/render lessee liable for the amounl due but it shall ~ol operate Io lem~inale tl~e lease.
. 7. If lessor owns a I~ser interest in ~e a~ve descd~ land other than ~e entire and und v d~ fee s p e estate therein, then the royalties, including shul-in royally, herein provided
snail be paid to lessor only in the propo~ion which lesso(s interes{ bears 1o ~e whole and und v ded fee. A~y inle~est in produdior from the lands described herein to which the iulerest
lessor may be subject shall be deducted from lhe royal~ herein rese~ed.
8. Lessee shall have the right to use, free o~ cost, gas, oil and water produced on said land for its operation Ihereon, excepl water from wells and rese~oirs o~ lessor.
9. Lessee shall pay to Lessor reasonable amounts for damages caused by its operalions logrow ng crops o ~ said land. When requested by lessor, lessee shall bury ils pipelines
which traverse cultivated lands below plow dept. No well shall be drilled nearer than ~o hundred (200) eeo a ~o~ se or barn now on said premises withoul w[Jtlen consenl of lessor.
Lessee shall have the right al any time (but nol the obligation), to remove all improvements, much ne~, and fixl~ ~es placed or erected by lessee on s~id premises, including the right
pull and remove casings.
10. Lessee is hereby given the right and power atan~ time and from time to time as a recurring righl ei(ber before or a~er production as lo a or any pa t of fie land described
above,and as to. aoy one or ~or~ of l~e f2rm~lions hereuneer,,to Pool or unitize the leasehold esla e a ~ ~e ~ eral estate covered by this I~ase with other !and, lease o~ leases in the
authmmea ...... ate v cini[y ~or the production o~ o an~ gas, or separately for the production of either, when. in lessee's iu~ ~ ~ent il is necessa. ~ or advisable. Io. do so. a ~d 'respect'ye of whether
only slmdar to th~s ex~sts wdh res~ecl to such other land, lease or leases. Dkew~se, un,ts prewously ~ormed ~o ~nclude [o~ na OhS no~ produang o~1 or gas n ay be reformed lo exclude
such non-producing formations. The forming or refom~ing of any unit shall be accomplished by lessee exec ~ it g a d ng o record a declarer o-~ of s~ c t L rilizal~on or ~efom~ation which
declaralion shall describe the unit. Any uni[may include land upon which a well has heretofore bee~ co hi)e[ed or upo w ~ c dr n9 ope a o s ~ave bee ~ cornmenced. P~o~uc{ion
drilling or reworking operations or a welt shut-in [or any reason anywhere on a unit which includes all or a pad o~ {his lease shall be treated as were producliou, d~illing o~ ~eworkiu~
oper. afions or a weii~ntJiLi~ ,nCJer this lease. In leu of the royalties elsewhere herein specifi~lli~'~sor shall receive on production from the unit so pooled roya e~ o] y on
such production allocated to this lease; such allocation shall be thai propodion ol tile unit production that the lotal number of surface acres coveredby Ibis lease and included in Ihe unit
bears to the total number of surface acres in such unit.
11. Lessee shall have the righl to unitize poo or combine all or any pad of the land described above as to one or more of the formations thereunder with olher ands r the same
general area by entering into a cooperative or ~nit plbn of development or operation approved by any governmental authority and from me o time, with like approval, Io modify, change
or terminate any such p an or agreement ar d r such event the Ierms conditions and prowsions of Ibis tease shall be dee~ed modified to contorm to the terms conditions, and
provisions ol such approved cooperative or unit plan of deve ~)pment or ~)peralion a~d padicularty all drilling and development requiremenls of this lease express or'implied shall be
satisfied by compliance with the drilling and development requiremen[s of such p an or.agreement 'and this lease shall not terminale or expire during the lite of such plan or agreemenl
In the event that the land described above or any part lhereof sba hereafter be operated under ,;~ny such cooperative or unit plan ol developmenl or operation whereby the I~loduction
therefrom is allocated to different podions of the ]and covered by said plan, then the production allocated Io any particular tracl of land shall Jot the purpose of computing le royallies Io
be paid hereunder to lessor, be regarded as having been produced from/he particular Iracl of land to which i[ is allocated and not to any other tract ot land: arid the royalty payments to
be made hereunder to lessor shall be based upon production only as so allocated.
12. If the estate of either party hereto is assigned or sub et, and the privilege of assigning or sublelli~rg in whole or in part is expressly allowed the express and implied covenants
hereof shall extend to the sublessees, successors and assigns of the partes; andin the event of an assignmen~ or subletting by lessee, lessee shall JJe relieved and discharged as lo Ihe
leasehold righls so assigned or sublet from any liability to essor thereafter accru ng upon any of the covenants or conditions of this lease, either express or implied h]o change in
ownership ol/he land royalties, or other payments, however accomplished, shall operate to enlarge the obligations or diminish the rights ol lessee or require separale measurinq or
installation of separate tanks by lessee. Notw~thstar~ding any actual or constructive knowledge of or notice lo lessee, no change in ownership of said land or ol'the righl lo race ye royal-lies
or other payments hereunder or of any interest therein, whether by reason ol death, conveyance or any other matter, shall be binding on lessee (except at lessee's option ia any padicular
case) until one hundred tweh'ty (120) days alter lessee has been turn shed written notice thereof, and the suppoding information hereinafter referred ~o by the party claiming as a result
of such change in ownership or inleresl. Such notice sha be supported by org hal and certified copies ol all documents and other instruments or p~oceedings necessary in lessee s
opinion Io establish the ownership of the claiming party.
13 In the interest of conservation the protecton of reservoir pressures and recovery of the greatest ultimate yield of oil and/or gas, lessee shall have the right to combine the
leased premises with other premises'in the same genera area for the purpose of operating and ma~ntainirJg repressudnq and recycling [ac les, and for such purpose rhay locale such
facilities, including input wells upon leased premises, and no royalties shall be payable hereunder upon any gas used ]or repressuring and recycling operations benefiting the leased
premises.
14. If lessor during the primary term of his ease, receives a bona f de offer from a third party to purchase from lessor a lease covering any or all of the subslances covered by this
lease and covering all or a podion ortho land described here n, with such lease to become effective upon expiration ol this lease, Which lessor is willing to accepl from ihe offering party,
lessor hereby agrees to notify lessee in writing of said offer framed ate y, including in the notice the name and address of/he offeror, the price offered and all other pertinent te~ms and
conditions olthe offer. Lessee for a period oil deed (15) days after the receipt of the notice, shall have Ihe prior and preferred right and option to purchase the lease or part thereol or
interest therein covered by th~' offer at the price and on the lerms arid condit OdS specified in the offer. All oilers made up to and ~ncluding the last day o[ lite prima~, term of this lease
sh.all, be subje.ct to, the t,erms and conditions of this paragraph 14. Should lessee elect to purchase the lease pursuant lo the terms hereof it shall so not b t,~,~,~¢,,-i,~ ~i~f,-,,-,
or [e~egram pnor ~o expiration of said fifteen (15) day per'od Lessee shal promptly thereafter fu-n'sh to lesso'r the new lease for execut o~ bylessor alon'~ ~/i'~'~'e~"se'~:~'~¥gl'~ d"r;f{'/~'~l~
lo lessor in payment of the specified amounl as consideration for the new lease, such draft being subjecl lo approval of Ilia accord ng Io the lerms thereof. Upon receipt thereof, lessor
shall prornptly execute said lease and return same along with the draft through lessor's hank ol record for paynJent.
15. In the event lessor considers that lessee has not con-plied with all i s ob gat ods hereunder e thor express or implied, lessor shall notify lessee in writing selling out spocifical y
in what respecls lessee has breached this lease. Lessee shal/then have sixty (60) days after rece'p of sa d ~ otice within which to meet or commence to rne~t all or any part oft e
breaches alleged b), lessor. The sen/ice of said dolce shal be precede il to the bringing ol any aclion by lessor on said lease for any cause and rio such acfioo shall be brought until the
lapse of sixty (60) nays after sen/ice of such notice on lessee. Neither he sen/ice of sa~d notice nor the doing of any acts by lessee aimed lc~ meal all or any ol lhe alleged b~eaches shall
be deemed an admission or presumption that lessee has failed to perform all its obligations l~ereunder This]ease shall never be lorfeited or cancelled tot failure Io perform
part any of ils implied covenants, conditions or stipulations until a ud cial determination is made I al SLid failure exisls and'lessee fails wilhin a reasonable time Io salisty any such
covenants, cond t ods, or st pulations.
16. All express and implied covenants of this lease shall be subject to all federal and state county or municipal laws execulive orders rules and regulations and lessee's
obits]orions and covenants hereunder, whether express or implied shall be suspended at the time or f~om lime o ne as comp 'a'nce with such obli~alions arid covenants i~ prevented or
hinoered by or is in conflict with federal state county, or municipal laws, rules regu afions or executive orders asserted as olficial by or under public authority claiming jurisd~clion or
of God, adverse lield, weather, or m~'rket conditions, inab ty to obtain materials in the open markel or Iranspodation thereof wars, slrikes lockouts, riots or other co,ditions or
circumstances not wholly controlled by lessee and this lease shall not be term dated n who e or in part nor lessee held liable in d,~mages lot failure to comply ~ith any such obligalions
or covenants if compliance therewith ~s prevented or hindered by or is in confiic w th any of the foregoin'g evemualides. The time during which lessee shall be prevenled from conc]ucting
drilling or reworking operations during the pr mary term of this lease, under the coot agencies above stated, shall be added to the primary term of this lease.
17. Lessor hereby warrants and agrees to defend the title to the lands described above and agrees al lessee al its option, shall have the right al anv lime to pay for lessor,
any mortga~e, taxes or other liens existing, levied or assessed on or against the above described lands in Ihe even/oI'de/ault of payment by lessor and be surrogated lo lhe rights
the holder thereof, and lessor hereby agrees that any such payments made by essee for the lessor may be deducled Irom any amounts of money which may become due the lessor
under the terms of this lease,
18. This lease and all its terms, conditions, and stipulations shall extend to and be binding on att successors in interest, in whole or in part, ot said lessor o~ lessee.
19. With respect to and for the purpose of this lease, lessor, and each of them if there be more than one, hereby release and waive the rigbt of homeslead.
WHEREOF witness our hands as of the day and year first above written.
Thompson Land and Livestock Company, a Wyoming Partnership
J0)(n o d Thompson, Individually, and aS Padder of Thompson Land and
Livestock Company, a Wyoming Padnership, and John Ronald Thompson, as
Attorney-In-Fact for Norene Thompson also known as Norene M. Thompson,
also known as Norene Murdock Thompson Stanley Geene Thompson, Jr.,
William T. Thompson, Don Mark Thompson, Ted Harold Thompson and Carole
Ann Thompson Goodman, Partners of Thompson Lands and Livestock Company,
a Wyoming Padnership
Tax I.D. #: 83-0192600
ACKNOWLEDGMENT
STATE OF WYOMING }
} SS.
COUNTY OF LINCOLN }
INDIVIDUAL
On this 30TM day of June , 2004 ,'before me personally appeared John Rona d Thompson, Individually~sand as Padder of Thorp_p&~0_ t.and and
Livg~tock Company, a Wyomi'n§ Padnership, and John Ronald Thompson, ~¢ac_t~[gr Norene T_hom~2~c_nl also ~ as
~rdock Thom son Stanl?y. Oen. e Th~ompson, Jr., ,.W. illiam T. ~Tho.~o,L~a~-~Sn,
boodman h'_artners o! Inompson Land and LIvestock uompany, a wyoming padnership to me known lo be the person described in, an-g
instrument~nowledged to me thai he executed the same as his free act anddeed, including the release and waiver of the right of homestead.
Given under my hand and seal this 30~ day of June~, 2004
ivty commission expires:
Notary Public for the State of ~ ~/ /:~ ~ ' "~ 9