HomeMy WebLinkAbout20104025.tiff 1111111 11111 111 111 11111 111111 11 11111 11111111
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17of8L23 R1 16.0020 3 3D 0.00Steve9P WMorreno Clerkr& Recorder
OIL AND GAS LEASE
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This Oil and Gas Lease("Lease")is made this',1� day of te..1Q V'('-tl'vj'—etar ,2010 by and between JORGENSEN MOTYCKA LEWIS PC whose address
is 709 3RD AVE LONGMONT,CO 80501-5926,("Lessor',whether one or more)and MINERAL RESOURCES,INC-,whose address is P.O.Box 328,
GREELEY,COLORADO 80632("Lessee").
WITNESSETII,For and in Consideration of TEN 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 therefrom oil and all gas of whatsoever nature or kind
(including coalbed gas),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(including dewatering of coal bed gas wells),and the exclusive surface or 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 Weld County. Colorado,described to wit:
TOWNSHIP 5 NORTH,RANGE 65 WEST,6TH P.M.
SECTION 5: PART OF THE SW/4 BEING MORE PARTICULARLY DESCRIBED AS
FOLLOWS: GR 5193 W30'N100'LOT 4,BLOCK 76,ALSO KNOWN AS 912
10 STREET GREELEY, COLORADO
INCLUDING ALL STRIPS.AND PARCELS OF LAND CONTIGUOUS
THERETO OR IN SAID SECTION.
CONTAINING 0.0689 ACRES,MORE OR LESS(the"Premises")
Notwithstanding anything to the contrary herein contained,this lease is a"No Surface Occupancy" Oil and Gas Lease. It is agreed and understood
that Lessee its successors or assigns shall not conduct any operations or locate any facilities on the surface of the leased lands. It is understood that
Lessee, its successors or assigns shall not be allowed any access to the surface of the leased lands without written consent of Lessor. It is further
agreed that Lessee shall have the right to drill and operate directional wells through and under said land irrespective of:he bottom hole locations of
said wells.To this end,Lessor herby grants to Lessee a subsurface casement for all purposes associated with such directional wells.
1. It is agreed that this Lease shall remain in full force for a term of five(5)years from this date("Primary Term")and as long thereafter as oil or gas of
whatsoever nature or kind is produced from the Premises or on acreage pooled or unitized therewith,or operations are continued as hereinafter provided. At any time
during the Primary Term of this Lease,Lessee,at its option may make tender to Lessor payment in the amount of$100 per net mineral acre,thereby extending the
Primary Term or this Lease by an additional five(5)years. If,at the expiration of the Primary Term,oil or gas is not being produced from the Premises or on acreage
pooled or unitized therewith but Lessee is then engaged in drilling.reworking or dewatering operations thereon,then this Lease shall continue in force so long as such
operations are being continuously prosecuted. Operations shall he considered to be continuously prosecuted if not more than ninety(9C)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 from any cause after the primary term,this Lease shall not terminate if Lessee commences
additional drilling,reworking or dewatering operations within ninety(9D)days from date of cessation of production or from date of completion of a 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,this Lease shall continue in force so long as oil or gas
is produced front 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 lime 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 arc: (a)on oil and other liquid hydrocarbons, t/8 of that produced and saved from 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 from time to time purchase any royalty oil in its
possession,paying die market price therefore prevailing for the field where produced on the date of purchase;(b)on gas and the constituents thereof produced from said
land and sold or used off the premises or in the manufacture of products therefrom,the market value at the well of 1/8 of the product sold or used. On product sold at
the well,the royalty shall be I/8 of the net proceeds realized from such sale. All royalties paid on gas sold or used off the premises or in the manufacture of products
therefrom will be paid after deducting from such royalty Lessor's proportionate amount of all post-production costs,including but not limited to gross production and
severance taxes,gathering and transportation costs from the wellhead to the point of sale,treating,compression,and processing. On product sold at the well,the royalty
shall be 1/8 of the net proceeds realized from such sale,after deducting from such royalty Lessor's proportionate amount of all of the above post-production costs and
expenses,if any.
4. Where gas from a well capable of producing gas(or from a well in which dewatering operations have commenced), is not sold or used after the
expiration of the Primary Term,Lessee shall pay or tender as royally to Lessor at the address set forth above One Dollar($1,00)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 from the date such well is shut in or
dewatering.operations are commenced and thereafter on or before the anniversary date of this Lease during the period such well is shut in or dewatering operations are
being conducted.
1. 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)(terein 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,free of cost,gas,oil and water produced on the Premises for Lessee's operations thereon,except water from the
wells of Lesser.
7. When requested by Lessor,Lessee shall bury Lessee's pipelinebelow plow depth.
8. No well shall be drilled nearer than 200 feet to the house or bem now on the Premises without mitten consent of Lessor,
9. Lessee shall pay for damages caused by Lessee's operations to growing crops on the Premises.
10. Lessee shall have the right at any time to remove all machinery and fixtures(including casing)Lessee has placed on the Premises.
II. The rights of the Lessor and Lessee hereunder may he 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 flour Lessor,and then only with respect to payments thereafter mode. No other kind of notice,
whether actual or constructive,shall he binding on Lessee. No present or future division of Lessor's ownership as to different portions er 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.
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 Premises and as to any one 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 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 fonnations. The forming or reforming of any unit shall he
accomplished by Lessee executing and filing of record a declaration ot-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;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 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,from
time to time,with like approval,to modify,change or terminate any such plan or agreement and in such event,the teams,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
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3731883 11/10/2010 03:3913 Weld County, CO
2 of 2 R 16.00 0 0.00 Steve Moreno Clerk&Recorder
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
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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[met of land;and royalty payments to be made hereunder to lessor
shall be based upon production only as so allocated. Lessor shall formally express lessors 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 of this Lease shall be subject m all Federal and Stale 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,act of God or other event of force rnajeure shall not be counted
against Lessee. lf,due to the above causes or any cause whatsoever beyond the control of Lessee,Lessee is prevented from conducting operations hereunder,such time
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shall not be counted against Lessee,and this Lease shall be extended for a period of time equal to the time Lessee was so prevented,anything in this Lease to the
contrary notwithstanding.
14. Lessor hereby 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,insofar as said right of dower and homestead may in
any way affect the putposes for which this Lease is made,as recited herein.
IS. Should any one or more the parties named as Lessor herein fail to execute this Lease,it shall nevertheless he binding upon all such parties who do
execute it as Lessor. The word"Lessor",as used in this Lease,shall mean any one 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.
16. If at any time 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(top lease)covering all or part of the aforedescnbed lands,lessee shall have the continuing option by meeting any such offer to
acquire such top 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 fonn to be utilized which form should reflect all pertinent and relevant terms and conditions of the top lease. Lessee shall have
fifteen(IS)days after receipt,from Lessor,of a 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)day period of its election to meet any such bona fide offer.Lessor
shall have the tight to accept said offer.
IN WITNESS WHEREOF,this instrument is executed as of the date first above written.
Jorgen otycka Lewis PC
C-42)ra\k t - JrCC\-EAn ;, U test..., e.lci.on i.
STATE OF l.o1ccfcLT-sue
n )SS.
COUNTY OF 4�[)C� .cIt{ )
BEFORE ME,the undersigned,a Notary Public,in and far said County and State,on this r) . day of l V n V tr Y her 2010.personally
appeared Jorgensen Motycka Lewis PC,to me known to be the identical persons described in and who executed the within and foregoing instrument of
writing,acknowledged to me that they duly executed the same as their free and voluntary act and deed for the uses and puryoses therein set forth.
IN WITNESS WHEREOF,I have hereunto setwr
my hand and affixed my notarial seal the day and year last above itten.
CI '711 My Commission Expires `' 17. ' I a f t' • nutb
/ Notary Public.
NOT••
q; 1%dl
"as'
When recorded return to:
Mineral Resources,Inc.
P.O. Box 328
Greeley, CO 80632
153664! !10/10/2010! !411
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