HomeMy WebLinkAbout20070040.tiff MEMORANDUM
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TO: Planning Commissioners 9/5/2006
COLORADO FROM: Chris Gathman - Planner II to,
SUBJECT: USR-1565 Revisions
Planning staff recommends the following revisions to the USR-1565 recommendation:
1) Town of Windsor (listed under referral responses received on page 1) shall be removed.
2) Condition of Approval 1.A (page 4) shall be revised to read:
Prior to the Board of County Commissioners hearing:
"The applicant shall provide written notification of the Board of County Commissioners
hearing for USR-1565 and the intent to vacate the portion of USR-599 located within the
proposed boundaries of USR-1565. Written evidence that notification has been provided along
with any written responses from these property owners shall be provided to the Department of
Planning Services."
3) Development Standard #9 (page 6) shall be removed.
y$q EXHIBIT
SERVICE,TEAMWORK,INTEGRITY,QUALITY
2007-0040
ASTRELLA & RICE PC
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Weld County Planning Department
GREELEY OFFICE
SEP 0 1 2006
August 31, 2006 RECEIVED
VIA FIRST-CLASS MAIL AND
TELEFAX: (970) 304-6498
Mr. Chris Gathman
Planner
Weld County Department of Planning Services
918 10"' Street
Greeley, CO 80631
Re: Case No. USR-1565
Dear Mr. Gathman:
This law firm represents Keirnes Land Company, LLC and its affiliates ("Keirnes")
with respect to the above-referenced matter. Keirnes objects to the proposed locations
of the future oil and gas wells (the "Proposed Wells") because locating the Proposed
Wells where indicated in the application will violate the terms of the Surface Use
Agreement dated February 23, 2006 between the Applicant, Texas American
Resources Company, and Keirnes. (Copy attached).
Please note that the sixth sentence contained in paragraph 2.1 of the Surface
Use Agreement states as follows: "There shall be no limitation hereunder on the use
and development by Surface Owners of any portion of the PROPERTY which is outside
of the Operation Areas so long as access roads and pipeline areas provided for herein
are maintained." (Emphasis added). Recital A of the Surface Use Agreement defines
the PROPERTY as of the date thereof as follows: "Surface Owners own fee title to Lots
A, B, and D, in Recorded Exemption No. 0805-23-1 RE-386, located in the West '/ of
the East ''A of Section 23, Township 6 North, Range 66 West of the 6th P.M., Weld
County, Colorado (the "Property")."
The two Operating Areas in which any additional wells, including the Proposed
Wells, drilled on the PROPERTY are required to be located are shown on Exhibit A to
the Surface Use Agreement. The Proposed Wells referenced in the Application are
outside of the Operating Areas agreed to by the parties. Locating the Proposed Wells
outside of the Operating Areas would constitute a breach of the Surface Use Agreement
by the Applicant, would severely limit Surface Owners' use and development of the
EXHIBIT ism nu..,..,,,, s1 lUU
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'02 911?I P'' 303 206 6347
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ASI'RELLA 8i RICE PC
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Letter to Chris Gathman
August 31, 2006
Page 2
Property and would also constitute an excessive use of the surface under Gerrity Oil
and Gas Corp. v. Magness, 946 P.2d 913, 929 (Colo. 1997).
If we can provide further information, or answer any questions, please do not
hesitate to contact our office.
Very truly yours,
Lance Astrella
LA/etr
Attachment
c: Bruce Barker, Weld County Attorney
Brad Keirnes
Texas American Resources Company
SURFACE USE AGREEMENT
v This Surface Use Agreement ("Agreement") is made and entered into this 2e. day of
fipt2y , 2006, by and between Texas American Resources
Company ("TARC"), whose address is 98 San Jacinto Boulevard, Suite 800, Austin, Texas
78701, and C. B. Keirnes Land Co. ("Keirnes") and Alta, LLC ("Alta"). Both Alta and
Keirnes are collectively referred to herein as "Surface Owners."
RECITALS
A. Surface Owners own fee title to Lots A, B, and D, in Recorded Exemption No.
0805-23-1 RE-386, located in the West 1/2 of the East %2 of Section 23, Township 6 North, Range
66 West of the 6`" P.M., Weld County, Colorado (the "Property").
B. Surface Owners warrant that they have authority to commit the surface rights in
the Property to this Agreement.
C. TARC represents that its parent company (TARH E&P Holdings, LP) holds a
valid and subsisting oil and gas lease in the Property and as such has the right to use the surface
of the Property to explore for, develop, and produce certain of the oil, gas, and other
hydrocarbons which underlie the Property.
D. TARC and Ridgeview Farms, LLC, an affiliate of Surface Owners, have
concurrently with the execution of this Agreement, executed a Surface Agreement involving
property of Ridgeview Farms, LLC contiguous to the east of the Property providing, inter alia,
that TARC will not conduct any surface exploration operations on the property owned by
Ridgeview Farms, LLC. In consideration for such agreement Surface Owners have agreed to
grant TARC certain rights to drill on the Property using directional or slant drilling techniques
from the surface of the Property as hereinafter provided to a location on the adjacent property
owned by Ridgeview Farms, LLC.
E. TARC currently operates one or more producing oil and gas wells and owns other
oil and gas production equipment and facilities on the Property and the adjacent Ridgeview
property, which are generally depicted on the map attached hereto as Exhibit "A". TARC's
facilities, equipment and operations on the Property and the adjacent property consist of, whether
shown on Exhibit "A" or not:
(1) Two producing gas wells known as the Eldridge #4-23 and the Eldridge
#2-23 (the "Wells");
(2) Two Tank Batteries which services the Wells and other wells located on
the Property and on adjacent lands (the "Tank Battery");
(3) A certain Compressor Site which services the Wells and other wells
located on the Property and on adjacent lands (the "Compressor");
(4) Certain pipelines and flowlines that carry oil, gas and other hydrocarbons
from the Wells and other wells to the Tank Batteries and to other pipelines
(the `.`Pipelines");
(5) Certain existing lease roads utilized by TARC which are located on and/or
cross the Property (the "Lease Roads");
(6) Possible future well locations known as the Eldridge#41-23, Eldridge#5-
1-23 (fifth spot) and the Eldridge #31-23 well in the NW/4NE/4 (the
"Proposed Wells").
F. Subject to applicable laws and regulations, TARC may have the right to drill
additional wells to produce oil and gas from the Property, including, but not limited to the
Proposed Wells, from surface locations on the Property, as shown on Exhibit"A".
AGREEMENT
NOW THEREFORE, in consideration of the covenants and mutual promises set forth
herein, including the information set forth in the recitals, the parties agree, to the extent of each
of their respective interests in the Property, as follows:
I. Drilling Locations.
1.1 Surface Owners agree that TARC may drill the Eldridge Well # 5-1-23
(fifth spot) either directionally or vertically(at TARC's sole option and expense) from a surface
location in Operation Area 1. Operation Area 1 shall be a 300' by 300' site as indicated on
Exhibit A.
1.2 Surface Owners agree that TARC may drill the Eldridge Well #41-23 by
directional or slant drilling from a surface location in Operation Area 2, to reach a bottom-hole
location under the NE/4 NE/4 Section 23 as shown on Exhibit "A". Operations Area 2 shall be a
325' by 325' site as indicated on Exhibit "A". The Eldridge Well # 31-23 (which shall be a
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vertical well) may also be drilled by TARC at a surface location on the Property in the NW/4
NE/4 Section 23, in the NE corner of Lot D in Operation Area 2 as shown on Exhibit A.
2. Oil and Gas Operation Areas.
2.1. Operation Areas . As shown on Exhibit A, the proposed wells are located
within a portion of the Property designated as the "Operation Areas 1 and 2." TARC shall co-
locate any additional tanks in Operation Area 3, which is a 300' x 300' site that includes one of
the existing Tank Batteries operated by TARC as shown on Exhibit A, and shall paint all new
tanks and all new equipment on the Property Area an earth tone color, subject to the reasonable
approval of Surface Owners. Surface Owners shall have the right to initially repaint existing
tanks and other equipment located on the Property on the date of this Agreement at its expense.
Subject to the terms and restrictions contained in this Agreement, Surface Owners shall continue
to own fee title to the surface of the Operation Areas subject to offset or distance setback
required by governmental agencies from oil and gas facilities. TARC will continue to have the
right to the use of such areas of the surface as may be reasonably required and restricted by this
Agreement within which to explore for and remove oil, gas, and other hydrocarbons and to
locate its associated facilities. There shall be no limitation hereunder on the use and
development by Surface Owners of any portion of the Property which is outside of the Operation
Areas so long as access roads and pipeline areas provided for herein are maintained. TARC shall
have the exclusive right of access to and use of the Operation Areas. The parties hereto each
acknowledge and agree that the Operation Areas and the respective rights thereto as described
herein satisfy the operation, access, set-back, and drilling needs of TARC and the development
objectives of Surface Owners. TARC shall maintain the Operation Areas free of weeds and
debris and shall maintain a graded ground surface of the Operation Areas and all access
roadways thereto. The parties agree that Surface Owners shall have the right to erect perimeter
fencing around the Property or any portion thereof. If any such fence crosses TARC's existing
access roads, Surface Owner shall install properly 'sized gates at such crossings to accommodate
drilling rigs and heavy equipment so that TARC will have continual, unimpeded access to its
wells and facilities. It is agreed and understood that any fencing erected by Surface Owners shall
not interfere with, reduce the size of, or impede access to the Operation Areas as so designated
on Exhibit"A".
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2.2 Landscaping. The parties agree that Surface Owners shall not locate any
structures or other permanent improvements within the Operation Areas; provided that Surface
Owners (or its designee) shall have the right to install and maintain fencing, earth berms and
trees around the Operation Areas and grass and other non-obstructive landscaping features within
the Operation Areas at its expense. After the initial installation of such landscaping, Surface
Owners (or a homeowner's association, governmental body, or other entity designated by
Surface Owners) shall have the right of access to the landscaped areas within the Operation
Areas for purposes of maintaining the landscaping. TARC shall not be liable for any damage to
landscaping or landscaping improvements which results from its reasonable exercise of its rights
hereunder.
2.3 Drill and Reworking of Wells. Subject to applicable laws and regulations,
TARC shall continue to have the right and privilege to exercise all of its oil and gas leasehold
rights to drill, operate, and produce, including, but not limited to, the deepening, directional or
slant drilling, fracturing, re-drilling or re-completing of all wells with a surface location within
the Operation Areas. Surface Owners shall not interfere with TARC's right to drill, operate, and
produce not only the existing Wells,but also those located within the Operation Areas.
2.4 Surface Damages. As consideration for the damages and loss of economic
value to Surface Owners of TARC 's use of the Operation Areas and drill sites, TARC agrees to
pay Surface Owners the sum of$5000.00 for each individual Operation Area situated on
Property within ten (10) days prior to TARC's use thereof. In regard to Operation Area 3, this
means that TARC will pay the agreed surface damage amount at such time as any new tanks or
equipment are added to the existing battery in Operation Area 3.
3. Access to the Operation Areas.
3.1 TARC understands and agrees that Surface Owners may in the future
develop a land use plan for the Property. In connection with such plan, portions of the existing
Access Roads may be replaced with improved public rights-of-way to be established as part of
the land use plan and at Surface Owners' expense. Until such plan is approved and the public
roads are installed, TARC will continue to use and maintain at its expense the existing
4
unimproved Access Roads to access the Operation Areas, wells and any other TARC equipment
and facilities.
3.2. Access Roads which are (or hereafter become) paved or otherwise
improved by Surface Owners in connection with Surface Owners' development of the Property
(the "Access Roads"), shall be constructed in such manner as to reasonably accommodate the
equipment normally used by TARC for its oil and gas operations, regardless of the standard for
roads or streets required by the applicable zoning requirements for the Property. Such use by
TARC shall include, but not be limited to the use of any necessary drilling or workover rigs in
the Operation Areas. When Surface Owners are prepared to proceed with land planning and
development, Surface Owners shall prepare and deliver to TARC the engineering plans and other
specifications for the Access Roads, and TARC and Surface Owners shall work together in good
faith to develop final plans and specifications which will reasonably support and accommodate
the requirements for TARC and Surface Owners for their respective purposes and intended
activities on the Property. Upon completion of any Access Road or pipeline relocation, Surface
Owners shall deliver to TARC recordable easements for the new Lease Road or Pipeline
locations in a form reasonable and acceptable to both TARC and Surface Owners. Surface
Owners shall keep any Access Roads paved by Surface Owners and jointly used by both parties
or the subdivision occupants in good condition and repair until the same are dedicated to and
accepted by the local governing authority. TARC shall use reasonable care not to damage such
paved Access Roads but shall not be responsible for any damage caused by TARC operations.
Neither party shall unreasonably interfere in the use of the Access Roads by the other party.
TARC shall maintain its Access Roads on the Property not used by occupants of the subdivision
to the reasonable satisfaction of Surface Owners.
3.3 In connection with TARC's efforts to obtain the permit approvals, Surface
Owners will use reasonable, good faith efforts to assist TARC to obtain any consent or approval
required by TARC from the local governing authorities to confirm that TARC will be permitted
to use those portions of the Access Roads to be located in public rights-of-way in a manner
which will reasonably accommodate TARC's operations in the Operation Area.
4. Notice of Easements.
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4.1 Recording of this Agreement. A copy of this Agreement shall be recorded
by Surface Owner in the books and records of the Office of the Clerk and Recorder for Weld
County.
4.2 Notice to Homeowners, Builders and/or other Developers. Surface
Owners shall furnish all homeowners, builders and developers which purchase all or any portion
of the Property and each person or entity who proposes to enter into a contract to purchase a lot
which is adjacent to or any part of which is within 150 feet from the Operation Areas or a
pipeline easement, with a plat that shows the locations of the Operation Areas, access routes, and
pipeline easements. In addition, Surface Owners shall provide written notice to all such
purchasers that include the following;
a. there may be ongoing oil and gas operations and production on
the surface of the Premises within the Operation Areas, pipeline easements and access
routes;
b. there are likely to be wells drilled and oil and gas production
facilities constructed and installed (including but not limited to compressor stations and
tank batteries) within the Operation Areas and flowlines and pipelines constructed and
maintained on the Premises;
c. heavy equipment will be used by TARC from time to time for oil and
gas drilling and production operations and such operations may be conducted on a 24-
hour basis; and
d. homeowner associations and buyers of individual lots or homes will
be subject to and burdened by all of the covenants and waivers made by Surface Owners
in this Agreement, including, but not limited to those covenants and waivers; i)
prohibiting the location of any building, structure, or other improvement within the oil
and gas Operation Areas; and ii) waiving objections to the drilling of wells, the
construction of facilities, and the conduct of oil and gas operations on the Property
consistent with this Agreement.
5. Successors and Assigns. This Agreement and all of the covenants in it shall be
binding upon the personal representatives, heirs, successors and assigns of the parties and the
benefits of this Agreement shall inure to their personal representatives, heirs, successor sand
assigns of the parties.
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6. Covenants Run with the Land. This Agreement constitutes covenants running
with the land and shall be binding upon all parties who succeed to any interest that Surface
Owners or TARC has or will have in the Property.
7. Governing Law. The validity, interpretation and performance of this Agreement
shall be governed and construed in accordance with the laws of the State of Colorado.
8. Severability. If any part of this Agreement is found to be in conflict with
applicable laws, such part shall be inoperative, null and void insofar as it conflicts with such
laws; however, the remainder of this Agreement shall be in full force and effect.
9. Notices. Any notice or communication required or permitted by this Agreement
shall be given in writing to either party and their respective successors and assigns of public
record either by (a) personal delivery; (b) expedited delivery service with proof of delivery; (c)
United States mail, postage prepaid, and registered or certified mail with return receipt
requested; or (d) prepaid telecopy or fax, the receipt of which shall be acknowledged, addressed
as follows:
C.B Keirnes Land Company, LLC and Texas American Resources Company
Alta, LLC 98 San Jacinto Blvd., Suite 800
55 South Elm Avenue Suite 200, Austin, Texas 78701
Eaton, Colorado 80615 512-480-8700—office
970-356-6600 - office 512-480-8732— facsimile
888.575.9254 - facsimile
Notice to successors or assigns of a party shall be addressed or delivered to such parties' address
of public record.
10. Entire Agreement. This Agreement sets forth the entire understanding among
the parties and supersedes any previous communications, representations or agreements, whether
oral or written. No change of any of the terms or conditions herein shall be valid or binding on
any party unless in writing and signed by an authorized representative of each party.
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11. Attorney's Fees. In the event either party to this Agreement brings suit to
enforce or interpret any portion of this Agreement, the party prevailing in such action shall be
entitled to recover all costs incurred in such action, including without limitation, reasonable
attorney's fees.
IN WITNESS WHEREOF, the undersigned parties have caused this Agreement to be
executed by a dul authorized representative on the day and year first above written.
TEXA AMERI N RESOURCES COMPANY
By:
Printed Name f
Title: Vice '2C•-s,.1�G.tst- LA-rip
C. B. Keirnes Lad LC. Alta, LLC
B :
Printed Name. Printed Named_ Aril-en-ed.
Title: Title: ///G61.,_rtt is
8
ACKNOWLEDGMENT
STATE OF TEXAS )
)ss.
COUNTY OF TRAVIS )
This instrument was acknowledged before me on the 3 rte� L� day of
rebrucsr 2OO6,by`C'ro. Gtese\rmn ,AI�ce testArc*- n tnc-1
of Texas American Resources Company, on b half of said company.
Q/LO.0 —M. iDhi
N y Public in and for the State of Texas
My commission expires: _
.,,�;i {pt.- KAREN M. WHITE
3 ^� oZoo�- `_ Notary Public,State of Texas
of -, it My Commission Expires
..,,,;... Match 28,2007
STATE OF COLORADO )
)
COUNTY OF Wf ld )
This instrument was acknowledged before me on the and day of
March 2006, byC ??mdl[ kC(dnps , yVIG{Vlrn tie K of C.
B. Keimes Land Company, LLC, on behalf df sai limited liability
i coihpany.(4 iLNotary Public ; �` c
My commission expires: T0NI M.
f GREEN
11,�� �
ii. CO\�..#if
STATE OF COLORADO )
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COUNTY OF \Ak id )
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This instrument was acknowledged before me on the ot day of
M(At-1'I 2006, by c, I-3rttdl.ItLI IC?-i tfhes, fl'V4 Vtciet of
Alta, LLC, on behalf of said limited liability *any.
A.. 1 vl tiles LiAI y ,.
Notary Public p� •• •••:B(�
— My co missionexpires: . •
I.j I-3CVI I T0NI M.
GREEN
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EXHIBIT "A"
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Possible Eldridge 41-23 •
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Lot Si2E35 \'1 j
l.octition of
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i'osSittie£id:taKe
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Operation Area 2(325'x 325) \ .i-\ _ 7
and Surface Location for --------.._\•...-1
Possible Eldridge.31-23 and
41-23 •
Location of Possible /
Eldridge 41- ••,•/ , T
tottom•Hol Location
' t it ratter.Area'1,silly x 3001 `. \ al Possible F drid5-7-23
and Surface i s atia i for •Po1ssible Edridge 5-1-23 1.. .
•
Pocvibte Fluty:;its ---K
itt i'Drill Window -----
F •
• Location of Possible /
Eldridge 5-1-23
Lot il2L'3808 L J.
Ao.-.sn Road `
.
Eldridge 2-23 --/ \ r .._._.—.—._._
\ }Existing Compressor
/ \
Existing Flow Linn \ Site \----• lank
\\ __ . Eldridge 4-23 —_,
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Operation Area. (30UT x 300) 1 ED - Access ltoaT!
Location of all existing •
and Future Tanks
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400 I 200 0 2 400 00 WO
SCALE:1 inch-400 Ant
t i 0 7-.: :.:;. 74%, Cassed'ay L:eative Designs.LLC �. • Keir es Land Company, LLC _ P.
V 35Sc,:,ihOtnAle Exhibit A
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