HomeMy WebLinkAbout20131883.tiffRESOLUTION
RE: APPROVE REQUEST TO WAIVE BID PROCEDURE CONCERNING AMENDED
SMALL TRACT OIL AND GAS LEASE, ACCEPT OFFER TO LEASE MINERAL
ACRE, AND AUTHORIZE CHAIR TO SIGN - BONANZA CREEK ENERGY
OPERATING COMPANY, LLC
WHEREAS, the Board of County Commissioners of Weld County, Colorado, pursuant to
Colorado statute and the Weld County Home Rule Charter, is vested with the authority of
administering the affairs of Weld County, Colorado, and
WHEREAS, by letter dated October 12, 2012, the Board was presented with an
explanation indicating the County's mineral interest of 25.5% for the mineral acres described
below, and the tract of land as 3.00 mineral acres, and
WHEREAS, on October 22, 2012, by Resolution #2012-2966, the Board waived the
bidding procedure according to the policy as set forth in the Weld County Code for parcels less
than five acres, accepted the offer of Bonanza Creek Energy Operating Company, LLC, 5601
Truxtun Avenue, Suite 210, Bakersfield, CA 93309, and signed a Small Tract Lease for the
following described mineral acres:
Section 34, Township 5 North, Range 63 West of
the 6th P.M., Weld County, Colorado
WHEREAS, by letter dated June 3, 2013, the Board was presented with a revised
explanation indicating the corrected County's mineral interest is 100% for 1.72 mineral acres,
versus 3.00 acres, and the corrected bonus amount was received in conjunction with an
Amended Small Tract Lease, and
WHEREAS, the Board finds that the amended lease offer from Bonanza Creek Energy
Operating Company, LLC, in the amount of SIX HUNDRED EIGHTY-EIGHT AND NO/100
DOLLARS ($688.00), is acceptable, with the further terms and conditions being as stated in said
Amended Small Tract Oil and Gas Lease, a copy being attached hereto and incorporated herein
by reference.
NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of
Weld County, Colorado, that the request of Bonanza Creek Energy Operating Company, LLC,
to waive the bidding procedure on an Amended Oil and Gas Lease concerning the above
described 1.72 mineral acres, be, and hereby is, granted.
BE IT FURTHER RESOLVED by the Board that the offer of Bonanza Creek Energy
Operating Company, LLC, to lease mineral acres, as hereinabove stated, be, and hereby is,
accepted.
2013-1883
LE0310(3)
WAIVE BID PROCEDURE I SMALL TRACT LEASE - [COMPANY NAME]
PAGE 2
BE IT FURTHER RESOLVED by the Board that the Chair, be, and hereby is, authorized
to sign said Amended Small Tract Oil and Gas Lease, which supersedes the lease previously
approved on October 22, 2012, by Resolution #2012-2966.
The above and foregoing Resolution was, on motion duly made and seconded, adopted
by the following vote on the 22nd day of July, A.D., 2013.
BOARD OF COUNTY COMMISSIONERS
WELD C@CTNT aOLORADO
ATTEST:
Weld County Clerk
BY:
Deputy Clerk to t
APP
Attorney
Date of signature: 14
Sean P. Conway
WAIL
Mike Freeman
IL—
bara Kirkme er
2013-1883
LE0310(3)
n
AMENDED WELD COUNTY OIL AND GAS LEASE
(Small Tract)
THIS AGREEMENT, made and entered into this 10th day of October 2012 by
and between WELD COUNTY, COLORADO, a political subdivision of the State of Colorado acting by and
through the Board of County Commissioners of the County of Weld, 1150 O Street, P.O. Box 758,
Greeley, CO 80632, hereinafter called Lessor, and:
Bonanza Creek Energy Operating Company, LLC
5601 Truxtun Avenue, Suite 210
Bakersfield, CA 93309
hereinafter called Lessee.
WITNESSETH, that Lessor, for and in consideration of the sum of $ 688.00 , cash in
hand paid, the receipt of which is hereby acknowledged, and the covenants and agreements hereinafter
described, has granted, demised, leased and let, and by these presents does grant, demise, lease and let
exclusively unto the said Lessee, the land hereinafter described, with the exclusive right for the purpose
of mining, exploring by geophysical and other methods, and operating for and producing therefrom; oil
and all gas of whatsoever nature or kind, with rights of way and easement for laying pipe lines, and
erection of structures thereon to produce, save and take care of said products, all that certain tract of land
situated in the County of Weld, State of Colorado, described as follows, to wit:
A strip of land fifty feet in width off the entire south side of the SE1/4, except those portions vacated by
Resolution adopted by the Weld County Board of County Commissioners on August 12, 1996, a copy of
which is recorded under Reception No. 2507157.
Section 34 Township 5N North, Range 63 West of the 6th P.M., Weld County, Colorado:
and containing 1.72 acres, more or less. This Amended Weld County Oil and Gas Lease (Small
Tract) amends that certain Weld County Oil and Gas Lease of even date recorded October 23, 2012
under Reception No. 3883079 in order to correctly reflect the sum of the consideration paid by Lessor,
and to more accurately describe the lands covered by the lease.
1. It is agreed that the lease shall remain in force for a term of three (3) 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 term 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 leased
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 term, this lease shall not terminate 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 term of this 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 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 term. Lessee may at any time or times during or after the primary term
3953810 Pages: 1 of 5
08/0Steve Moreno013 11:38 and Recorder,AM R Weld d County, CO
®IIIklP.rinir+ifr 'Ii;'k'I'6VJf kg E4iLft'IAA ®I III
C:\Users\kford\Des
L 0,510 3)
2013-1883
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.
3953810 Pages: 2 of 5
08/06/2013 11:38 PM R Fee:$0.00
Steve Moreno, Clerk and Recorder, Weld County, Co
gill hntElC ut/Dig ®I III
C:\Users\kford\Desktop\Small Tract 1.72 Acres.doc
(Revised 1/2012)
3. In consideration of the premises the said Lessee covenants and agree to pay Lessor
twenty percent (20%) of the proceeds received by Lessee, payable monthly, for the oil, gas and other
hydrocarbons produced and saved from the leased premises.
4. Where gas from a well capable of producing gas is not sold or used, Lessee may pay or
tender as royalty to Lessor One Dollar per year per net mineral acre owned by Lessor and covered by this
lease, such payment or tender to be made on or before the anniversary date of this lease next ensuing
after the expiration of 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 less than the entire oil and gas fee simple estate in the above
described lands, then the royalties (including any shut-in gas royalty) herein provided for shall be paid to
the said Lessor only in the proportion which Lessor's interest bears to the entire oil and gas mineral fee
simple estate.
6. Lessee shall have the right to use, free of cost or royalty, gas, oil and water produced on
said land for Lessee's operations thereon, except water from the wells of Lessor.
7. When requested by Lessor, Lessee shall bury Lessee's pipe lines below plow depth.
8. No well shall be drilled nearer than 200 feet to any occupied building on said premises
without the written consent of Lessor.
9. Lessee shall have the right at any time to remove all of Lessee's machinery and fixtures
placed on said premises, including the right to draw and remove casing.
10. The rights of Lessor and Lessee hereunder may be assigned in whole, or in part, upon
payment of a $25.00 fee and written consent of the Board of Weld County Commissioners, such consent
shall not be unreasonably withheld. 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 payment thereafter made. No other kind of
notice, whether actual or constructive, shall be binding upon 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 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 land described herein
and as to any one or more of the formations 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 or oil and gas, or separately for the production or 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 or reworking 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 or reworking
operation 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 from the unit so pooled
royalties only on the portion of such production allocated to this lease; such allocation shall be that
3953810 Pages: 3 of 5
08/06/2013 11:38 PM R Fee:$0.00
Steve Moreno, Clerk and Recorder, Weld County, CO
FY: hi Ed. L�'iiC' rciniii aIiA1/41Y4,h 111111
C:\Users\kford\Desktop\Small Tract 1.72 Acres.doc
(Revised 1/2012)
proportion of the unit production that the total number of surface acres covered by this lease and included
in the unit bear 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 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, from 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 or 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 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 the 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.
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.
13. Lessor does not warrant title to the leased premises, but it shall, upon request, allow
Lessee access to such abstracts and other title papers as it has in its files. 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 a default of payment by Lessor, and be subrogated to the rights of the holder
thereof.
14. Lessee shall indemnify Lessor against all liability and loss, and against all claims and
actions, including the defense of such claims or actions, based upon or arising out of damage or injury,
including death, to persons or property caused by or sustained in connection with operations on this
leased land or by conditions created thereby, or based upon any violation of any statute, ordinance or
regulation.
15. Upon failure or default of Lessee to comply with any of the terms and provisions hereof
including but not limited to the failure to comply with laws, rules and regulations covering Colorado oil and
gas operations, Lessor is hereby authorized upon notice and hearing, as hereinafter provided, to cancel
this lease as to all of the leased land so claimed or possessed by Lessee hereunder. In the event of any
such default or failure, Lessor shall, before making any such cancellation, send to Lessee by certified
mail, to the post office address of said lessee as shown by the records of Lessor, a notice or intention to
cancel for such failure or default, specifying the same, stating that if within forty-five (45) days from the
date of mailing said notice, Lessee shall correct such failure or default, no cancellation will be made. If
such failure or default is not corrected with forty-five (45) days after the mailing of such notice, and if
Lessee does not request a hearing on such notice within forty-five (45) days, this lease will terminate
and be canceled by operation of the paragraph without further action by Lessor, or further notice to
Lessee.
16. All of the provisions of this lease shall be binding upon the heirs, personal
representatives, successors and assigns of Lessor and Lessee.
3953810 Pages: 4 of 5
08/06/2013 11:38 AM R Fee:$0.00
Steve Moreno, *11 k and Recorder, Weld County, CO
Nr1A11GNVJIri ; Ii1'k'i i�JG4h U }Fd�W'1a6��i t III
C:\Users\kford\Desktop\Small Tract 1.72 Acres.doc
(Revised 1/2012)
17. Lessee shall not conduct operations of any kind upon the surface of the lands herein
described without the express written consent of Lessor, such consent shall not be unreasonably
withheld.
18. Neither party shall be responsible for delays or failures in performance resulting from acts
or occurrences beyond the reasonable control of such party, including, without limitation: fire, explosion,
power failure, flood, earthquake or other act of God; war, revolution, civil commotion, terrorism, or acts of
public enemies; any law, order, regulation, ordinance, or requirement of any government or legal body or
any representative of any such government or legal body; or labor unrest, including without limitation,
strikes, slowdowns, picketing or boycotts. In such event, the party affected shall be excused from such
performance (other than any obligation to pay money) on a day-to-day basis to the extent of such
interference (and the other party shall likewise be excused from performance of its obligations on a day-
to-day basis to the extent such party's obligations relate to the performance so interfered with).
IN WITNESS WHEREOF, Lessor has hereunto signed and caused its name to be signed by the
CHAIR, BOARD OF COUNTY COMMISSIONERS OF THE COUNTY OF WELD, with the seal of the
office affixed, and Lessee has signed this agreement, the day and year first above written.
ATTEST:
Weld County Clerk to the Board
By:
Deputy Clerk
STATE OF COLORADO
Wail
) ss
COUNTY OF deii )
BOARD OF COUNTY COMMISSIONERS
WELD COUNTY COLORADO
Chair, Boar of City Commissioners
JUL 2 2 2013
LESSEE: 4_:�i'/OrThc. en -et enS.v04 1 OQ/""11,5 C`-cMfranyii.l,C.
By:
Title: 1//?e2
The foregoing instrument was acknowledged before me this 15\-- day of
20 90 by r 1eiry f the-%dwet/1
Witness my hand and official seal.
Notary Public
My Commission Expires:
3953810 Pages: 5 of 5
08/06/2013 11:38 AM R Fee:$0.00
Steve Moreno, Clerk and Recorder, Weld County, CO
®III PAW Ili PR I1 NA 1fIiP[M1'Y' lAidfYel'ffi III III
CAROLINE HEURING
NOTARY PUBLIC
STATE OF COLORADO
NOTARY ID 20124056829
MY COMMISSION EXPIRES SEPT. 24.2919
C:\Users\kford\Desktop\Small Tract 1.72 Acres.doc
(Revised 1/2012)
July 3, 2013
Bruce T. Barker, Esq.
Weld County Attorney
P.O. Box 758
1150 "O" Street
Greeley, CO 80632
RE: Small Tract Oil and Gas Leases
Bonanza Creek Energy Operating Company, LLC
Tracts in the E'/2 -34 -5n -63w
Weld County, CO
Dear Bruce:
EREN LAND SERVICES
Petroleum Land Consultants
P.O. Box 336337
Greeley, CO 80633
(970) 351-0733
Fax (303) 484-2110
cazeren®aol.com
Enclosed please find two Amended Weld County Oil and Gas Leases covering small
tracts in Section 34, Township 5 North, Range 63 West, 6th P.M. which have been
signed by an authorized representative of Bonanza Creek Energy Operating Company,
LLC. As you know, we previously submitted a check in the amount of $1,267.06 to
correctly compensate the County for the mineral ownership under the involved tracts.
We ask that upon execution and recording of the enclosed leases that the recorded
originals be returned to our office. We have stamped our return address on the back of
the leases.
If you have any questions, please do not hesitate to call me.
Coally,
Cyn is A. E. Zere, CPL
Ag t for Bonanza Creek Energy Operating Company, LLC
enclosures
Karla Ford
From:
Sent:
To:
Subject:
Stephanie Arries
Friday, June 21, 2013 1:41 PM
Karla Ford
RE: Small Tract Oil and Gas Leases - Amendments
Karla
The language to be added so that we have two amended leases looks fine — as long as we are satisfied that the
acreage information is correct. — If the new information is right, the language is perfect.
Stephanie L Arries
Assistant Weld County Attorney
1150 "O" Street
P.O. Box 758
Greeley, Colorado 80632
Tel: 970-356-4000 ext 4394
Fax: 970-352-0242
Email: sarriesaco.weld.co.us
co.weld.co.us
STATEMENT OF CONFIDENTIALITY & DISCLAIMER:The information contained in this email message
is attorney privileged and confidential, intended only for the use of the individual or
entity named above. If the reader of this message is not the intended recipient, you are
hereby notified that any dissemination, distribution or copy of this email is strictly
prohibited. If you have received this email in error, please notify us immediately by
replying and delete the message. Thank you.
From: Karla Ford
Sent: Friday, June 21, 2013 1:35 PM
To: Stephanie Arries
Subject: Small Tract Oil and Gas Leases - Amendments
Stephanie —
Please see the note below from Cyndi Zeren regarding adding a few things to their small tract lease. We are correcting
them due to their miscalculations. I have attached the copies for your approval. Just let me know if they are ok to send
to her for completion.
Thanks!
Karla Ford R
Deputy Clerk to the Board
1150 O Street/P.O. Box 758
Greeley, CO 80632
tel: (970)336-7215 X4228
1
Confidentiality Notice: This electronic transmission and any attached documents or other writings are intended only for the person or entity to which it is addressed
and may contain information that is privileged, confidential or otherwise protected from disclosure. If you have received this communication in error, please
immediately notify sender by return e-mail and destroy the communication. Any disclosure, copying, distribution or the taking of any action concerning the contents of
this communication or any attachments by anyone other than the named recipient is strictly prohibited.
From: Cazerenfaaol.com [mailto:CazerenCalaol.com]
Sent: Friday, June 21, 2013 12:44 PM
To: Karla Ford
Cc: anewell@albonanzacrk.com
Subject: Re: Small Tract Oil and Gas Leases - Amendments
Karla:
Per our phone conversation, I believe that we can save some possible confusion in the future if we reference the prior oil
and gas leases that are being revised in the new Amended leases prior to circulation for signature. I caught a couple of
other small matters and we ask that the following be incorporated into the proposed Amended OGLs:
1. On the lease that covers the 2.97 acre tract, we ask that you add the following language, perhaps in the block
containing the legal description: This Amended Weld County Oil and Gas Lease (Small Tract) amends that
certain Weld County Oil and Gas Lease of even date recorded October 23, 2012 under Reception No.
3883078 in order to correctly reflect the sum of the consideration paid by Lessor.
2. On the lease that originally covered a 3.00 acre tract, but is being amended down to a 1.72 acre tract, we ask that
the following changes be made:
• We ask that you add the following language, perhaps in the block containing the legal description: This
Amended Weld County Oil and Gas Lease (Small Tract) amends that certain Weld County Oil and Gas
Lease of even date recorded October 23, 2012 under Reception No. 3883079 in order to correctly reflect
the sum of the consideration paid by Lessor, and to more accurately describe the lands covered by the
lease.
• Please revise the legal description to read as follows: A strip of land fifty feet in width off the entire south
side of the SE/4, except those portions vacated by Resolution adopted by the Weld County Board of
County Commissioners on August 12, 1996, a copy of which is recorded under Reception No. 2507157.
• Also, please note that the involved tract now covers 1.72 gross acres, not 1.78.
Let me know if you have any questions concerning these issues.
Cyndi Z
Cynthia A. E. Zeren, CPL
ZEREN LAND SERVICES
P.O. Box 336337
Greeley, CO 80633
970-351-0733
In a message dated 6/18/2013 11:09:39 A.M. Mountain Daylight Time, kford(o�co.weld.co-us writes:
Cindy,
Attached are the two amended Small Tract Leases in reference to your letter dated June 3`d. Please
complete these and mail back to us and we will get those corrected in our files. We will also need new
Division Orders for each lease since they were calculated incorrectly.
If you have any further questions, please let me know. Thank you!
2
Karla Ford R
Deputy Clerk to the Board
1150 O Street/P.O. Box 758
Greeley, CO 80632
tel: (970)336-7215 X4228
Confidentiality Notice: This electronic transmission and any attached documents or other writings are intended only for the person or entity to which it is
addressed and may contain information that is privileged, confidential or otherwise protected from disclosure. lfyou have received this communication in
error, please immediately notes sender by return e-mail and destroy the communication. Any disclosure, copying, distribution or the taking of any action
concerning the contents of this communication or any attachments by anyone other than the named recipient is strictly prohibited
3
June 3, 2013
Bruce T. Barker, Esq.
Weld County Attorney
P.O. Box 758
1150 "O" Street
Greeley, CO 80632
ZEREN LAND SERVICES
Petroleum Land Consultants
P.O. Box 336337
Greeley, CO 80633
(970) 351-0733
Fax (303) 484-2110
cazeren@aol.com
RE: Small Tract Oil and Gas Leases
Bonanza Creek Energy Operating Company, LLC
Tracts in the E% -34 -5n -63w
Weld County, CO
Dear Bruce:
Per my email dated May 30, 2013 and at your instruction, enclosed is our check in the
amount of $1,267.06 as additional bonus consideration for the small -tract oil and gas
leases recently obtained by Bonanza Creek Energy Operating Company, LLC
("Bonanza Creek") covering three tracts in the E'% of Section 34, Township 5 North,
Range 63 West, 6th P.M.
As previously explained, when we were completing the title opinions covering the
various wells drilled and completed by Bonanza Creek in the E% of said Section 34, we
determined that the previous bonus calculations on the leases and been mis-calculated
and the enclosed check represents the additional bonus payable under all of the said
leases.
By way of explanation, bonuses were calculated as follows with the following revisions:
Tract 1 - OGL 3883077 - 3.31 gross acres
This lease covers a bridge parcel and the County owns 25.50% of the
minerals. We calculated the bonus payment correct on this tract:
3.31 x .225 - .84405 x $400 = $337.62
Tract 2 - OGL 3883078 - 2.97 gross acres -- dtwo 1. 946"
This lease covers a 50' strip along the East side of the Section covering
2.97 gross acres. However, the County owns 100% of the minerals
underlying this strip and we paid based on a 25.50% ownership:
2.97 x .225 = .75735 x $400 = 302.94
The correct calculation for the bonus should have been:
2.97 x $400 = $1188.00
°iii
LE03o(Z)
The difference being: 1188.00 - 302.94 = $885.06 owed to the County
Qe0310-2
(10310-3
Tract 3 - OGL 3883079 - 3.00 gross acres - Should be 1.72 gross acres - (e,tis
eio
This tract is a little less direct because we had the road abandonment
platted subsequent to the leases and it changed the actual lands owned '%�
by the County. When the road abandonment is netted out of the original ��rin( -
50' strip along the South line of the E/2-34, the actual area owned by the
County is 1.72 acres. To further complicate the situation, we calculated
the original bonus payment based on a 25.50% mineral ownership and it
should have been 100% underlying this tract:
Original calculations:
Correct callculations:
The difference being:
3.00 x .255 = .765 x $400 =
1.72 x $400 =
$688 - $306 =
$306.00
$688.00
$382.00
The total amount outstanding to the County based on the new calculations for both of
the underpaid leases is $1,267.06.
Let me know if you have any further questions.
Cor., Ily,
Cynt1 is A. E. ren, PL
Aget for Bonanza reek Energy Operating Company, LLC
enclosure
p0
CD
RECEIVED FROM
U)
W
0
Q O
8
MNi
bM
rn *
Zie
tit
a la
/\w
a
ahro
cC
::x
3E908 O0 icaiaai0 aoorm
892. xo8 a/ Od
limos a43 01 N1Ja13 Kit
opemo�oa `A}unoo RaM �U
AND SERVICES - GREELEY, CO
�0 OO
N 'co 0.
M N
a
C
CO
O
O O
N N
CO O
a) CO O
• O O
O to co co
O co co
C
co
Co
m
co 0
Eoo
Q0000
al (0 CO
C
O)
O
k.
P
PA
1.0
Check Amount
N CO
U U
CO N
IL IL
U V) CO
C C C
N o on
4) J J
a00
Z O
O I m m
N
N
m -0
TD- CO CO
00
CJ N N N
N M CO
O co co
U
0
'o
U
0
C
C
c6
co
Tammy Waters
From:
Sent:
To:
Subject:
Bruce Barker
Monday, June 17, 2013 11:55 AM
Esther Gesick; Tammy Waters
FW: Bonanza Creek Energy Small Tract OGLs - Section 34 -5n -63w
This was the e-mail exchange with Cyndi Zeren.
Bruce T. Barker, Esq.
Weld County Attorney
P.O. Box 758
1150 "O" Street
Greeley, CO 80632
(970) 356-4000, ext. 4390
Fax: (970) 352-0242
Confidentiality Notice: This electronic transmission and any attached documents or other writings are intended only for the
person or entity to which it is addressed and may contain information that is attorney privileged and confidential, or otherwise
protected from disclosure. If you have received this communication in error, please immediately notify sender by return e-mail
and destroy the communication. Any disclosure, copying, distribution or the taking of any action concerning the contents of this
communication or any attachments by anyone other than the named recipient is strictly prohibited.
From: Cazeren@aol.com [mailto:Cazeren@aol.com]
Sent: Monday, June 03, 2013 12:13 PM
To: Bruce Barker
Subject: Re: Bonanza Creek Energy Small Tract OGLs - Section 34 -5n -63w
We'll get it taken care of. Thanks.
In a message dated 6/3/2013 8:49:29 A.M. Mountain Daylight Time, bbarkerco.weld.co.us writes:
Cyndi:
Thanks. One check would be fine.
Bruce T. Barker, Esq.
Weld County Attorney
P.O. Box 758
1150 "O" Street
Greeley, CO 80632
(970) 356-4000, ext. 4390
Fax: (970) 352-0242
Confidentiality Notice: This electronic transmission and any attached documents or other writings are intended only for
the person or entity to which it is addressed and may contain information that is attorney privileged and confidential, or
otherwise protected from disclosure. If you have received this communication in error, please immediately notify sender
by return e-mail and destroy the communication. Any disclosure, copying, distribution or the taking of any action
concerning the contents of this communication or any attachments by anyone other than the named recipient is strictly
prohibited.
From: Cazeren@aol.com [mailto:Cazeren@aol.com]
Sent: Thursday, May 30, 2013 1:28 PM
To: Bruce Barker
Subject Bonanza Creek Energy Small Tract OGLs - Section 34 -5n -63w
Bruce:
As we are completing the title opinions covering the various wells recently drilled and completed by Bonanza Creek Energy
Operating Company in the E/2 -34 -5n -63w. As I was working with the attorney with some of the more specific legal descriptions
regarding a recent road abandonment and some of his wording in the original drilling title opinion, I realized that we did not pay the
County an appropriate bonus on 2 of the 3 small -tract oil and gas leases that we acquired:
Tract 1 - OGL 3883077 - 3.31 gross acres
This lease covers a bridge parcel and the County owns 25.50% of the minerals. We calculated the bonus payment correctly on this
tract: 3.31 x .255 = .84405 x $400 — $337.62
Tract 2 - OGL 3883078 - 2.97 gross acres
This lease covers a 50 strip along the E side of the Section and was determined to cover 2.97 gross acres. However, the County owns
100% of the minerals underlying this strip and we only paid based on a 25.50%
ownership: 2.97 x .255 = .75735 x $400 = 302.94
The correct calculation for the bonus should have been: 2.97 x $400 = $1188.00
The difference being: 1188.00 - 302.94 = $885.06 owed the County
2
Tract 3 - OGL 3883079 - 3.00 gross acres - Should be 1.72 acres
This tract is a little less direct because we had the road abandonment platted and it changed the actual lands, and therefore minerals,
that were owned by the County. When the road abandonment is netted out of the original 50' strip along the South line of the E/2-34,
the actual area owned by the County is 1.72 acres. To further complicate the situation, we calculated the original bonus payment
based on a 25.50% mineral ownership and it should have been 100% underlying the remaining of this tract:
Original calculations:
Correct calculations:
The difference being:
3.00 x .255 = .765 x $400 = $306.00
1.72 x $400 = $688.00
688 - 306 = $382.00 owed to County
So, according to my new calculations I believe that we still owe the County $1,267.06 as bonus consideration for the combined
leases.
Please let me know what you would like us to do - if it's better to submit one check for the difference in both of the leases - or if
separate checks is better; and let me know if you require anything further for a better understanding.
Cordially,
Cyndi Z
Cynthia A. E. Zeren, CPL
ZEREN LAND SERVICES
P.O. Box 336337
Greeley, CO 80633
970-351-0733
3
Hello