HomeMy WebLinkAbout20050523.tiff RESOLUTION
RE: AUTHORIZE OIL AND GAS LEASE COVERING CERTAIN PROPERTY OWNED BY
WELD COUNTY, COLORADO, AND AUTHORIZE CHAIR TO SIGN - PART OF S28,
T11, R61W
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,Weld County, Colorado, is the owner of vast acres of mineral lands located in
Weld County, Colorado, and
WHEREAS, the Department of Purchasing was authorized to solicit bids for lease of a
portion of said mineral acres not currently leased, and
WHEREAS,Walsh Production, Inc., P.O. Box 30, Sterling,Colorado 80751,submitted the
high bid to lease 320.0 net mineral acres, more or less, described to-wit:
Part of Section 28, Township 11, Range 61 West of
the 6th P.M., Weld County, Colorado
WHEREAS, Weld County desires to accept the high bid offer submitted by Walsh
Production, Inc.to lease the above described mineral acreage for$20.00 per net mineral acre, for
a total sum of$6,400.00,together with an annual rental fee of ONE DOLLAR($1.00)per net mineral
acre, which lease is to run for a period of three (3) years, commencing February 9, 2005, and
ending at 12:00 noon on February 9,2008, unless otherwise held,as stated in the lease agreement
which is attached hereto and incorporated herein by reference.
NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of Weld
County, Colorado,that the high bid offer of Walsh Production, Inc. be, and hereby is, accepted for
a period of three (3) years.
BE IT FURTHER RESOLVED by the Board that the Chair be, and hereby is, authorized to
sign said lease.
2005-0523
LE0122
ea 1. Wit L Q� /S >s-
OIL AND GAS LEASE - PART OF S28, T11, R61
PAGE 2
The above and foregoing Resolution was, on motion duly made and seconded, adopted by
the following vote on the 9th day of February, A.D., 2005.
BOARD OF COUNTY COMMISSIONERS
E� `� If/,//�/,l/AA//////// WELD COUNTY, COLORADO
William H erke, Chair
lip
;�� • �� lerk to the Board
. J. Bile, Pro-Tern
Deputy Cler,' to the Board `^k( Em
D id E. Long
P VEDAST9 M:
RAM
. Masde
County Attorney aac
Glenn Vaad!
Date of signature:4/2,C
2005-0523
LE0122
WELD
Bison Energy Corporation
"t@' 1511 2% Ali 10: f 0 P.O. Box 3234
Littleton, Colorado 80161
RECEiVrrED (303) 470-8067
November 24, 2004
Ms Carol Harding
Purchasing Department
Weld County
P.O. Box 758
Greeley, Colorado 80632
RE: Oil and Gas Lease Sale.
Dear Ms. Harding:
Would you please place the following tracts of land on the next possible county lease sale.
Township 10 North, Range 61 West, 641 P.M. — £.0'-5'
Sec. 7: SW/4SW/4
Township 11 North. Range 61 West, 6"'P.M. p
Sec. 28: W/2NE/4, SW/4NW/4, E/2NW/4, N/2SW/4, NW/4SE/4 —/ '- 3
From what I have determined, it appears Weld County owns a 100% interest in the minerals.
Please notify me at the above address when these parcels are available.
Thank you very much for your help. Should you have any questions, please call me at (303)470-
8067.
Very truly yours,
_t?).;
Jim Crawford
Bulled(lAProperlies4530 South Verbena Street
Unit 381
Denver,Colorado 80237-2599
Phone 303-843-0973 Fax 303-290-8812
•
a
November 21,2004
Weld County Board of County Commissioners
P.O. Box 758 /✓/
915 10th Street �¢
Greeley,CO 80632
To Whom it May Concern:
A)
Re:Township 3 North,Range 63 West,6th PM .L CI- G� / g , s
Section 10:NE
Weld County,Colorado
Per my earlier conversation with Bruce Barker with the Weld County Attorney's office, I would like to
request that the Board of County Commissioners offer the captioned lands for bid for an Oil and Gas
Lease. Based on my information,these lands cover a full interest or 160 acres.
Please advise me as to when these lands will be offered and the date whereby bids are accepted.
Thank you.
Since
Van K. Bullock
f1
Weld County Commissioners.doc
98
WELD COUNTY OIL AND GAS LEASE
Containing 320.0 acres, more or less: -_ g
Containing 320.0 net mineral acres, more or less: c ac
U atj
THIS LEASE AGREEMENT, dated this 9th day of Fvhr„ary ,20ns , made and
entered into by and between WELD COUNTY,COLORADO,a political subdivision of the STATE OF COLORADO, — o
acting by and through the BOARD OF COUNTY COMMISSIONERS OF THE COUNTY OF WELD,for its respective =
interests, c/o BOARD OF COUNTY COMMISSIONERS, 915 10TH STREET, P.O. BOX 758, GREELEY, CO
80632, hereinafter called Lessor, and: 141
Walsh Production , Inc. P. 0. Box 30 Sterling, CO 8051 _4?rn
N
COQ
hereinafter called Lessee: Immo-c c
W ITNESSETH
H-M •
O
WHEREAS, said Lessee has applied to Lessor for an oil and gas lease covering the land herein described, i=c cc
and has paid a filing fee in the amount of$10.00,plus a bonus consideration of$ 20.00 per mineral acre,fixed
by Lessor as an additional consideration for the granting of this lease, and Lessee agrees to pay an annual rental
of$ 320.00 ,computed at the rate of$ 1.00 ,per mineral acre or fraction thereof per year,and the =M
following consideration:
WHEREAS,all the requirements relative to said application have been duly complied with and said application
has been approved and allowed by Lessor;
THEREFORE,in consideration of the agreements herein,on the part of Lessee to be paid,kept and performed,
Lessor does lease exclusively to Lessee for the sole and only purpose of drilling for,development of and production
of oil and gas, or either of them,thereon and therefrom with the right to own all oil and gas so produced and saved
therefrom and not reserved as royalty by Lessor under the terms of this lease, together with rights-of-way,
easements and servitudes for pipelines,telephone and telegraph lines,tanks and fixtures for producing and caring
for such product, and housing and boarding employees, and any and all rights and privileges necessary for the
exploration and operation of said land for oil and gas, the following described land situated in the County of Weld,
State of Colorado, and more particularly described as follows:
DESCRIPTION OF LAND SECTION TOWNSHIP RANGE
W2NE4, SW4NW4, E2NW4, N2SW4, NW4SE4 28 11 61
TO HAVE AND TO HOLD said land,and all the rights and privileges granted hereunder to Lessee until the hour
of twelve o'clock noon on the 9th day of February , 20 08 as primary term, and so long
thereafter as oil and gas, or either of them, is produced in paying quantities from said land or Lessee is diligently
engaged in bona fide drilling or reworking operations on said land, subject to the terms and conditions herein.
Drilling or reworking operations shall be deemed to be diligently performed if there is no delay or cessation thereof
for a greater period than sixty consecutive days unless an extension in writing is granted by lessor, provided that
such drilling or reworking operations are commenced during said primary term or any extension thereof or while this
lease is in force by reason of production of oil and gas or either of them,or that such reworking is commenced
within sixty days upon cessation of production for the purpose of re-establishing the same,and provided further that
such production is commenced during such primary term or any extension thereof, or while this lease is in force
by reason of such drilling or reworking operations or other production.
EXPLORATION-Lessor reserves the right to conduct exploration on the leased land provided such exploration
does not interfere with rights granted herein.
2005-0523
_ _ /__
•
County, CO
Oil and Gas Lease 111111111111111111 6/2005 02:35P We����� 111111111 III!
Page 2 2 of 8 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
In consideration of the premises, the parties covenant and agree as follows:
1. RENTAL-If this lease is extended for an additional term as provided for in the EXTENSION paragraph
hereof, Lessee shall pay to Lessor the sum of One Dollar($1.00)per acre for the land covered hereby as
delayed rental for the term of the extension. Rentals set at the time of established production shall be
paid during the remaining life of this lease, annually, in advance, on or before each anniversary date
hereof. There shall be no refund of unused rental.
2. ROYALTY-Lessee shall account for any and all substances produced on the leased land and Lessee
shall pay to Lessor as royalty, in addition to the rentals provided, but except for products used on the
leased land, unavoidably lost or flared on the leased land,with approval of Lessor, the following:
A. On oil, 12.5% of the oil produced and saved from the leased land.
At the option of Lessor, and with sixty(60) days' notice to Lessee, Lessor may take its royalty oil
in kind,in which event Lessee shall deliver such royalty oil to Lessor on the leased land,free of cost
or deduction,into the pipelines or storage tanks designated by Lessor,but.Lessee shall not in such
case be required to provide free tankage for any such oil for a longer period than one month after the
same is run into tanks. With sixty(60)days'notice to Lessee, Lessor may cease taking oil royalty
in kind. When paid in cash, the royalty shall be calculated upon the fair market value of the oil at
the well which shall not be deemed to be less than the price actually paid to Lessee at the well by
the purchaser thereof; and in no event shall the royalties be based upon a market value at the well
less than the posted price in the field for such oil, or in the absence of a posted price in the field for
such oil, upon a market value at the well less than the prevailing price received by other producers
in the field for oil of like grade and gravity at the time such oil is run into pipelines or storage tanks.
B. On gas, including casing head gas or other gaseous substance, 12.5% of the fair market value
at the well or of the price received by Lessee at the well, whichever is greater, of all gas produced
and sold from the leased land or utilized off the land by Lessee. A copy of all contracts for sale of
gas shall be furnished to Lessor. Where gas is sold under contract that has been approved by
Lessor,the fair market value of such gas for determining the royalties payable hereunder shall be the
price at which such gas is sold under such contract. No approval by Lessor of the terms of any such
agreement shall operate to make Lessor a party thereto or obligate it thereunder in any way. At the
option of Lessor, and with sixty (60) days' notice to Lessee, Lessor may take its royalty in kind.
With sixty(60)days'notice to Lessee, Lessor may cease taking gas royalty in kind.
C. All costs of marketing the oil and/or gas produced shall be borne by Lessee and such costs shall
not directly or indirectly reduce the royalty payments to Lessor. Except that marketing costs for
Lessor's in-kind royalty shall be borne by Lessor.
D. If Lessor owns a lesser interest in the oil and gas deposits of the above-described land than the
entire and undivided fee simple estate,then the royalties and rentals herein provided shall be paid
to Lessor only in the portion which its interest bears to the whole and undivided fee, but no refund
of any bonus consideration shall be made by Lessor hereunder.
3. RECORDS-Lessee agrees to keep and to have in possession complete and accurate books and records
showing the production and disposition of any and all substances produced on the leased land and to
permit Lessor,at all reasonable hours,to examine the same,or to fumish copies of same to Lessor upon
request along with purchaser's support documentation. Lessor will not be unreasonable with requests.
All said books and records shall be retained by Lessee and made available in Colorado to Lessor for a
period of not less than five years.
111111111111111111111111 ���� 11111111111III11111H IIII
Oil and Gas Lease 3268986 03/16/2005 02:35P Weld County, CO
Page 3 3 of 8 R 0.00 0 0.00 Steve Moreno Clerk& Recorder
4. MEASUREMENTS - All production shall be accurately measured using standards established by the
American Gas Association (AGA) and/or the American Petroleum Institute (API) and all measuring
devices shall be tamper proof as nearly as possible. Oil royalties due within the terms of this lease shall
be calculated on actual and accurate measurements within API standards unless a different means of
measurement,subject to Lessor's approval, is provided.
5. PAYMENTS AND REPORTS-All payments and reports due hereunder shall be made on or before the
day such payments and reports are due. Nothing in this paragraph shall be construed to extend the
expiration of the primary term hereof.
Oil royalty payments and supporting documents shall be submitted prior to the last day of the month
following each month's sale of production,and gas royalty payments and supporting documents shall be
submitted prior to the last day of the second month following each month's sale of production.
All payments shall be made by cash, check, certified check, or money order. Payment having
restrictions, qualifications, or encumbrances of any kind whatsoever shall not be accepted by Lessor.
A penalty for a late payment shall be charged as set forth in the PENALTIES paragraph herein.
6. PENALTIES - A penalty shall be imposed for, but not limited to late payments, improper payments,
operational deficiencies, violation of any covenant of this lease, or false statements made to Lessor.
Penalties shall be determined by Lessor unless otherwise provided for by law and may be in the form of,
but not limited to, interest,fees,fines, and/or lease cancellation. A penalty schedule shall be prepared
by Lessor and shall become effective immediately after public notice. Said schedule may be changed
from time to time after public notice.
7. LAW-The terms and conditions of this lease shall be performed and exercised subject to all laws,rules,
regulations, orders, local ordinances or resolutions applicable to and binding upon the administration of
lands and minerals owned by the County of Weld,and to laws,rules and regulations governing oil and gas
operations in Colorado. Violations shall result in penalties as provided for by law or as set forth in the
aforementioned schedule or shall, at the option of Lessor, result in default as provided hereinafter.
8. SURRENDER-Lessee may at any time, by paying to Lessor all amounts then due as provided herein,
surrender this lease insofar as the same covers all or any portion of the land herein leased and be relieved
from further obligations or liability hereunder with respect to the land so surrendered; provided that no
partial surrender or cancellation of this lease shall be for less than contiguous tracts of approximately forty
(40) acres or Governmental lot corresponding to a quarter-quarter section; provided further that this
surrender clause and the option herein reserved to Lessee shall cease and become absolutely inoperative
immediately and concurrently with the institution of any suit in any court of law by Lessee, Lessor or any
assignee of either to enforce this lease, or any of its terms expressed or implied. In no case shall any
surrender be effective until Lessee shall have made full provision for conservation of the leased products
and protection of the surface rights of the leased land.
9. ASSIGNMENTS-
A. Lessee, with prior written consent of Lessor, shall have the right to assign the entire leasehold
interest of said Lessee in all or part of the land covered hereby, but not less, however, than
contiguous tracts of approximately forty(40)acres or Govemmental lot corresponding to a quarter-
quarter section for any partial assignment, and for approval of such assignment Lessor shall make
an assignment charge in an amount to be determined by Lessor. Prior to written approval by Lessor
of assignment of this lease,Lessee(assignor)shall not be relieved of its obligations under the terms
and conditions herein. An assignment shall not extend the term of this lease.
•
1 111111 11111 I I I I 11111111 I I I 111111111111 I I 11111 I I I 11111
Oil and Gas Lease 34279886 03116/2005 02:35P Weld County, CO
Page 4 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
B. If any assignment of a portion of the land covered hereby shall be approved, a new lease shall be
issued to the assignee covering the assigned land, containing the same terms and conditions
as this lease,and limited as to term as this lease is limited,and the assignor shall be released and
discharged from all further obligations and liabilities as to that portion so assigned.
C. Lessee shall notify Lessor of all assignments of undivided percentage or other interests. Said
interests will not be recognized or approved by Lessor, and the effect of any such assignments will
be strictly and only between the parties thereto,and outside the terms of this lease: and no dispute
between parties to any such assignment shall operate to relieve Lessee from performance of any
terms or conditions hereof or to postpone the time therefor. Lessor shall at all times be entitled to
look solely to Lessee or his assignee shown on its books as being the sole owner hereof, and for
the sending of all notices required by this lease and for the performance of all terms and conditions
hereof.
D. Although not binding on Lessor, all instruments of every kind and nature whatsoever affecting this
lease should be filed with the Lessor.
10. OVERRIDING ROYALTY-Any and all reservations or assignments or overriding royalties shall be subject
to approval by Lessor. The total of said overriding royalties shall not exceed five percent(5%), including
any overriding royalty previously provided for unless production exceeds a monthly average of fifteen(15)
barrels per day or ninety thousand cubic feet of gas per day(90 MCF/D). In the event production drops
to this amount or less, any overriding royalties which exceed five percent (5%) may be suspended.
Lessor's approval of a reservation or assignment of an overriding royalty shall not bind Lessor for payment
of said overriding royalty and shall not relieve Lessee of any of its obligations for payment of royalties to
Lessor as provided by ROYALTY paragraphs herein.
11. OFFSET WELLS - Lessee agrees to protect the leased land from drainage by offset wells located on
adjoining lands not owned by Lessor, when such drainage is not compensated for by counter-drainage.
It shall be presumed that the production of oil and gas from offset wells results in drainage from the leased
land,unless Lessee demonstrates to Lessor's satisfaction,by engineering,geological,or other data,that
production from such offset well does not result in such drainage,or that the drilling of a well or wells on
the leased land would not accomplish the purposes of protecting the deposits under the leased land.
Lessor's decision as to the existence of such drainage shall be final, and Lessee shall comply with
Lessor's order thereon or surrender this lease as to any such undeveloped acreage as designated by
Lessor.
12. DEVELOPMENT - Upon discovery of oil and gas or either of them on the leased land, Lessee shall
proceed with reasonable diligence to develop said land at a rate and to an extent commensurate with the
economic development of the field in which the leased land lies.
13. POOLING CLAUSE - Lessee may at any time or times pool any part or all of said land or lease or any
stratum or strata with other lands and leases, stratum or strata, in the same field so as to constitute a
spacing unit to facilitate an orderly or uniform well-spacing pattem or to comply with any order, rule, or
regulation of the State or Federal regulatory or conservation agency having jurisdiction. Such pooling shall
be accomplished or terminated by filing of record a declaration of pooling,or declaration of termination of
pooling, and by mailing or tendering a copy to Lessor, or to the depository bank. Drilling or reworking
operations upon or production from any part of such spacing unit shall be considered for all purposes of
this lease as operations or productions from this lease. Lessee shall allocate to this lease the
proportionate share of production which the acreage in this lease included in any such spacing unit bears
to the total acreage in said spacing unit.
14. UNITIZATION-COMMUNITIZATION-In the event Lessor permits the land herein leased to be included
within a communitization or unitization agreement,the terms of this lease may be deemed to be modified
to conform to such agreement. When only a portion of the land under this lease is committed by an
1111111 11111 11111 DIE 3111111 11111 III IIIII IIII IIII
Oil and Gas Lease 3268986 03/16/2005 02:35P Weld County, CO
5 of 8 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
Page 5
agreement, Lessor may segregate the land and issue a separate lease for each portion not committed
thereunder, the term of such separate lease shall be limited as to the original term of this lease. The
terms of the lease on that portion remaining in the unit shall be deemed to be modified to conform to such
agreement. Non-producing leases shall terminate on the first anniversary date of the lease following the
termination date of the unit or part thereof modifying the lease, but in no event prior to the end of the
primary term of the lease or the extension term of the lease.
15. PRODUCTION - Lessee shall, subject to applicable laws, regulations and orders,operate and produce
all wells upon the leased land so long as the same are capable of producing in paying quantities, and
shall operate the same so as to produce at a rate commensurate with the rate of production of wells on
adjoining lands within the same field and within the limits of good engineering practice, except for such
times as there exist neither market nor storage therefor, and except for such limitations on or
suspensions of production as may be approved in writing by Lessor. Lessee shall be responsible for
adequate site security on all producing properties.
16. SHUT-IN WELLS - If Lessee shall complete a well on the leased land productive of gas and Lessee is
unable to produce such gas due to a lack of suitable market therefor, Lessor may grant Lessee
suspension of his obligations to produce hereunder until a suitable market for such gas can be found,and
during any such suspension period, it shall be deemed that gas is being produced hereunder in paying
quantities. Except, however,that beginning on the anniversary date next, of the year of an extension of
the lease by reason of a shut-in well,Lessee shall pay to Lessor a shut-in royalty equal to$2.00 per acre
of the lease per annum in addition to the annual rental. The minimum amount of such shut-in royalty
payment shall be $240. Each year's shut-in royalty shall be forfeited to Lessor except for the shut-in
royalty paid for the year during which the well begins production. The maximum extension of the lease,
due to the existence of a shut-in well, shall be five years beyond the extension term as described in the
EXTENSION paragraph herein. The granting of any further extensions shall be at the sole option of
Lessor.
17. OPERATIONS-No exploration,drilling or production operation, including permanent installations,shall
be within 200 feet of any existing building or other improvement,including water well or reservoir,without
the written permission of the owner of said improvements. Lessee shall keep a correct log of each well
drilled hereunder,showing by name or description the formations passed through,the depth at which each
formation was reached, the number of feet of each size casing set in each well,where set,and the total
depth of each well drilled. Lessee,within thirty(30)days after the completion or abandonment of any well
drilled hereunder, shall file in the office of Lessor a complete and correct log of such well, together with
a copy of the electric log and the radioactivity log of the well when such logs, or either of them, are run;
and also a copy of all drill stem test results,core records and analyses, record of perforations and initial
production tests, if any. If any of the information required by this paragraph is contained in reports
required to be filed with the Oil and Gas Conservation Commission of Colorado,the requirements of this
paragraph for such information may be satisfied by such filing with said Commission, except for copies
of the reports as are required by the following paragraph, and provided that all such information is
immediately available to Lessor. Any proprietary information so submitted shall not be subject to public
inspection under Colorado law.
Lessee shall bury pipelines below plow depth. Lessee shall set and cement sufficient surface casing to
protect the fresh water wells of the area.
18. NOTIFICATION-Lessee shall notify Lessor and the surface lessee or surface owner of the location of
each drill site at least two weeks prior to commencing drilling operations thereon. Lessee shall notify
Lessor before commencing to plug and abandon any well by copy of Lessee's request for approval or
sundry notice of intent to plug and abandon.
1111111 11111 11111 11111111111111111 11111II11111111111111
Oil and Gas L 3268986 03/16/2005 02:35P Weld County, CO
Page 6 6 of 8 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
19. BONDS-Lessee shall be liable for all damages to the surface of the land, livestock, growing crops,water
wells,reservoirs, or improvements caused by Lessee's operations on said land. No operations shall be
commenced on the land hereinabove described unless and until Lessee shall have filed a good and
sufficient bond with Lessor,in an amount to be fixed by Lessor,to secure the payment for such damages
as may be caused by Lessee's operations on said land and to assure compliance with all the terms and
provisions of this lease, the laws of the State of Colorado, and the rules and regulations thereto
appertaining. A bond may be held in effect for the life of production of any well.
20. SETTLEMENT-Lessee shall not remove any machinery,equipment or fixtures placed on said land,other
than drilling equipment, nor draw the casing from any well unless and until all payments and obligations
currently due Lessor under the terms of this lease shall have been paid or satisfied. Any machinery,
equipment or fixtures left on this land for a period of more than six(6)months after the expiration hereof,
shall automatically become the property of Lessor.
21. OTHER DISCOVERY-Should Lessee discover any valuable products other than oil and gas,on or within
the leased land, Lessee shall within seven (7) days report such discovery to Lessor, in which event
Lessee and Lessor may negotiate a provision for production of such discovery.
22. WATER - This lease does not grant permission, express or implied, to Lessee for water exploration,
drilling, or establishing water wells without the written permission of the surface owner. If Lessor is the
surface owner, said permission shall not be unreasonably withheld. If Lessee desires to establish or
adjudicate any water right for beneficial use on the leased land,any such adjudication or application shall
be in the name of Lessor if Lessor is the surface owner. The same shall apply to any non-tributary water
rights established on the leased land which may be put to beneficial use off said land.
23. DEFAULT - 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 governing 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 of
intention to cancel for such failure or default, specifying the same, stating that if within thirty (30)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 within thirty(30)days after the mailing of such notice,and
if Lessee does not request a hearing on such notice within thirty(30)days, this lease will terminate and
be canceled by operation of this paragraph without further action by Lessor, or further notice to Lessee.
24. EXTENSION - If Lessee fails to make discovery of oil and gas, or either of them,in paying quantities
during the primary term hereof, or during drilling operations commenced during the primary term hereof,
Lessee may make written application to Lessor for an extension of this lease. The granting of such
extension shall be at the sole option of Lessor, according to the following conditions:
A. No lease term will be extended for more than six(6)months from the original expiration date.
B. That the Lessee shall pay to the Lessor the sum of one-third of the original bonus,with a minimum
bonus of Ten Dollars($10.00)per acre.
C. The Lessee must pay to the Lessor the sum of One Dollar($1.00)per acre leased as delayed rental
for the term of the extension.
D. That the royalty will remain the same.
�H I l l 11111111111111111 I I I 111111111111 I I 11111111111111
Oil and Gas Lease 3268986 03/16/2005 02:35P Weld County, CO
Page 7 7 of 8 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
25. HOLD HARMLESS- 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.
26. CONDEMNATION - If the leased land shall be taken in any condemnation proceeding,this lease shall
automatically terminate as of the date of taking. The award for such condemnation shall be paid to
Lessor,except for any specific award(s)paid to Lessee for severed oil and gas reserves, in which event
of such specific award(s)shall be paid to Lessor in lieu of royalty lost by virtue of the
condemnation. Improvements shall be removed by Lessee per terms in the SETTLEMENT paragraph
herein. If only a portion of the leased land is taken by condemnation, Lessor may,at its option,terminate
this lease or terminate only that portion of the lease so taken.
27. ERRORS - Every effort is made by Lessor to avoid errors in all procedures including but not limited to
auction listings and lease preparation. Lessor shall not be liable for any inconvenience or loss caused
by errors which may occur. Lessee shall notify Lessor immediately upon discovery of any errors or
discrepancy whatsoever.
28. ARCHAEOLOGY - Lessee shall not destroy, disturb, mar, collect, remove or alter any prehistoric or
historic resources of any kind on Weld County lands as provided by law. These resources include, but
are not limited to, all artifacts of stone,wood or metal, pictographs,structures, and bones. A discovery
of anything of prehistoric or historic nature shall be reported to Lessor or the State of Colorado
Archaeologist immediately.
29. DEFINITIONS-
A. "Gas" as used herein shall mean all gases (combustible and noncombustible), including but not
limited to all gaseous hydrocarbons, gaseous compounds, carbon dioxide,and helium.
B. "Oil and gas" as used herein shall include all substances produced as by-products therewith,
including But not limited to sulfur.
C. "Paying quantities" as used herein shall mean and refer to quantities of oil and gas or of either of
them sufficient to pay for the current cost of producing same.
30. HEIRS AND ASSIGNS-The benefits and obligations of this lease shall inure to and be binding upon the
heirs,legal representatives,successors or assigns of Lessee;but no sublease or assignment hereof, or
of any interest herein, shall be binding upon Lessor until the same has been approved by Lessor as
explained in the ASSIGNMENTS'paragraph provided.
31. WARRANTY OF TITLE-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. There shall be no
obligation on Lessor's part to purchase new or supplemental or other title papers nor to do any curative
work in connection with title to the subject lands. All abstracts of title, whether new or supplementary,
obtained by Lessee and covering the subject lands shall become the property of and be delivered to
Lessor after Lessee has completed its title examination and curative work,subject, however,to the right
of Lessee to use such abstracts upon request at any time during the term of the lease.
Oil and Gas Lease 111111111111 11111 11111111111111111 HIM 11111111111 3268986 03/16/2005
Page 8 8 of 8 R 0.00 D 0.00 Steve Moreno Clerk& Recorder
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.
BOARD OF COUNTY COMMISSIONERS
WELD COUNTY, COLORADO
e c/ `rk to the Board
' 1861
Chair, Board of County Commissioners FEB 0 9 2005
A
Deputy Clerk .• th= Board
LESSEE:
Wal d ion , Inc.
BY
Dean R. Cackle
STATE OF COLORADO )
) ss
COUNTY OF WELD
The foregoing instrument was acknowledged before me this 4th day of February , 20 05 .
Witness my hand and official seal.
Notary Public Debby Mari P. 0. Box 30 Sterling , CO 80751
My Commission Expires:
12-21-2005
ti>,
y ;•
o ' C « < =
Ili al
oL r :?
a fc Gf -N -I-
i ;; ;; `'"``,
m:tctblctbfonnslfolease
(Revised 07/2003)
Hello