HomeMy WebLinkAbout880094.tiff RESOLUTION
RE : APPROVE REQUEST OF GEORGE VAUGHT, ON BEHALF OF BLUE CHIP OIL,
INC. , TO WAIVE BIDDING PROCEDURE CONCERNING OIL AND GAS LEASE
AND ACCEPT OFFER TO LEASE MINERAL ACRES
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, George Vaught, on behalf of Blue Chip Oil, Inc. has
requested that the bidding procedure be waived concerning an Oil
and Gas Lease on the following described mineral acres :
A tract or parcel of land #21 of the
Department of Highways ' project #S . 0034 (2) ,
in the NiN} of Section 24 , Township 6 North,
Range 67 West of the 6th P.M. , Weld County,
Colorado
WHEREAS, after review, the Board found that George Vaught, on
behalf of Blue Chip Oil, Inc. did show good cause for waiving the
bidding procedure on said Oil and Gas Lease, and
WHEREAS, Blue Chip Oil, Inc. is offering to lease the above
described mineral acres , containing 3 .49 mineral acres, more or
less , and
WHEREAS, the Board finds that the lease offer from Blue Chip
Oil, Inc . in the amount of TWO HUNDRED AND NO/100 DOLLARS
($200 .00) , is acceptable, with the further terms and conditions
being as stated in said 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 Blue
Chip Oil , Inc. , 710 11th Avenue, Suite 301 , Greeley, Colorado
80631 , to waive the bidding procedure on an Oil and Gas Lease
concerning the 3 .49 mineral acres , be , and hereby is, approved.
BE IT FURTHER RESOLVED by the Board that the offer of Blue
Chip Oil, Inc. , as hereinabove stated, be, and hereby is,
accepted.
880094
Page 2
RE: WAIVE BID PROCEDURE - BLUE CHIP OIL, INC.
The above and foregoing Resolution was, on motion duly made
and seconded, adopted by the following vote on the 10th day of
February, A.D. , 1988 .
BOARD OF COUNTY COMMISSIONERS
ATTEST: f tJ WEL OUNTY, COLORADO
Weld County erk and Recorder Pand Clerk to the Board a T2. Brantner, Chairman Ety
fly C.W. Kirb , Pro Tem
D uty County C rk
APPROVED AS TO FORM: Ja quell. - s n
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Q Go : .:' '. ass:
F'
County Attorney '� "��' `��
Frank Yamaguchi
880094
AR2131289
WELD COUNTY OIL AND GAS LEASE
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Containing 3.49 acres, more or less;
ri o Containing 3.49 net mineral acres, more or less:
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0 2 THIS LEASE AGREEMENT, dated this 10th day of February , 19 88 , made and entered
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into by and between WELD COUNTY, COLORADO, a political subdivision of the STATE OF COLORADO, acting by and
y,W through the BOARD OF COUNTY COMMISSIONERS OF THE COUNTY OF WELD, for its respective interests, c/o BOARD OF
2 COUNTY COMMISSIONERS, WELD COUNTY CENTENNIAL CENTER, 915 10TH STREET, GREELEY, CO 80631, hereinafter called
o Lessor, and:
U Blue Chip Oil, Inc.
uo z 710 11th Avenue, Suite 301
CD
Greeley, CO 80631
N hereinafter called Lessee:
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ao U WITNESSETH
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Tj WHEREAS, said Lessee has applied to Lessor for an oil and gas lease covering the land herein described,
No and has paid ffix Ln fgxgagotxtuecoluantX 7PRRx RR GO9Qplum a bonus consideration of $ 200.00 ax
Gri %3W@, fixed by Lessor as an additional consideration for the granting of this lease, and Lessee agrees to
, pay an annual rental of $ 4.00 , computed at the rate of $ 1.00 , per mineral acre or
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2 WHEREAS, all the requirements relative to said application have been duly complied with and said
N application has been approved and allowed by Lessor;
WTHEREFORE, in consideration of the agreements herein, on the part of Lessee to be paid, kept and
a performed, Lessor does lease exclusively to Lessee for the sole and only purpose of drilling for,
co ti development of and production of oil and gas, or either of them, thereon and therefrom with the right to own
oall oil and gas so produced and saved therefrom and not reserved as royalty by Lessor under the terms of
rl o this lease, together with rights-of-way, easements and servitudes for pipelines, telephone and telegraph
u Ga 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
A tract or parcel of land #21 of
the Dept. of Highways' project
#S. 0034(2) , in the N1/2N1/2 24 6N 67W
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 10th day of February , 19 91 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
(Rev. 11/86) 880094
primary term or any extension thereof, or while this lease is in force by reason of such drilling or
cop reworking operations or other production.
or.)
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EXPLORATION - Lessor reserves the right to conduct exploration on the leased land provided such
U exploration does not interfere with rights granted herein.
rl In consideration of the premises, the parties covenant and agree as follows:
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a 1. RENTAL - If this lease is extended for an additional term as provided for in the EXTENSION
W paragraph hereof, Lessee shall during such extended period pay to lessor an annual rental at double the rate
aabove specified for the land covered hereby. The rental in effect at the time production is established
O shall not be increased due to the term of this lease being extended by such production. Rentals set at the
14 time of established production shall be paid during the remaining life of this lease, annually, in advance,
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o on or before each anniversary date hereof. There shall be no refund of unused rental.
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.ti x 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
co a leased land, unavoidably lost or flared on the leased land, with approval of Lessor, the following:
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• z (a) On oil, 7.2'% of the oil produced and saved from the leased land.
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o to 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,
ON free of cost or deduction, into the pipelines or storage tanks designated by Lessor, but Lessee shall
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G+ not in such case be required to provide free tankage for any such oil for a longer period than one
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month after the same is run into tanks. With sixty (60) days' notice to Lessee, Lessor nay cease
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taking oil royalty in kind. When paid in cash, the royalty shall be calculated upon the fair market
o value of the oil at the well which shall not be deemed to be less than the price actually paid to
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• Lessee at the well by the purchaser thereof; and in no event shall the royalties be based upon a market
a � 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
• N received by other producers in the field for oil of like grade and gravity at the time such oil is run
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ri o into pipelines or storage tanks.
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CON (b) On gas, including casinghead gas or other gaseous substance, 121/2% 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.
88009.1
(Rev. 11/86)
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
co O Lessor, at all reasonable hours, to examine the same, or to furnish copies of same to Lessor upon request
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along with purchaser's support documentation. Lessor will not be unreasonable with requests. A11 sal
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m0 books and records shall be retained by Lessee and made available in Colorado to Lessor for a period of not
U less than five years.
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o �i] 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
g be tamperproof as nearly as possible. Oil royalties due within the terms of this lease shall be calculated
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q on actual and accurate measurements within API standards unless a different means of measurement, subject to
O Lessor's approval, is provided.
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In a 5. PAYMENTS & REPORTS - All payments and reports due hereunder shall be made on or before the day
• ,p such payments and reports are due. Nothing in this paragraph shall be construed to extend the expiration of
the primary term hereof.
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Oil royalty payments and supporting documents shall be submitted prior to the last day of the
cc' U month following each month's sale of production, and gas royalty payments and supporting documents shall be
o Z submitted prior Co the last day of the second month following each month's sale of production.
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ry E All payments shall be made by cash, check, certified check or money order. Payments having
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restrictions, qualifications, or encumbrances of any kind whatsoever shall not be accepted by Lessor.
• D penalty for a late payment shall be charges as set forth in the PENALTIES paragraph herein.
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N Ga 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.
N Penalties shall be determined by Lessor unless otherwise provided for by law and may be in the form of, but
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r not limited to, interest, fees, fines, and/or lease cancellation. A penalty schedule shall be prepared y
Lessor and shall become effective immediately after public notice. Said schedule may be changed from time
to time after public notice.
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Co N 7. LAW - The terms and conditions of this lease shall be performed and exercised subject to all laws,
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r+ o rules, regulations, orders, local ordinances or resolutions applicable to and binding upon the
pl r.., administration of lands and minerals awned 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.
(Rev. 11/86) 880091
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 Governmental lot corresponding to a
co O quarter-quarter section for any partial assignment, and for approval of such assignment Lessor shall
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p make an assignment charge in an amount to be determined by Lessor. Prior to written approval by Lessor
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of assignment of this lease, Lessee (assignor) shall not be relieved of its obligations under the terms
U and conditions herein. An assignment shall not extend the term of this lease.
o (b) If any assignment of a portion of the land covered hereby shall be approved, a new lease
0 3 shall be issued to the assignee covering the assigned land, containing the same terms and conditions as
o Pi this lease, and limited as to term as this lease is limited, and the assignor shall be released and
u} W discharged from all further obligations and liabilities as to that portion so assigned.
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U (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
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0 will be strictly and only between the parties thereto, and outside the terms of this lease: and no
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N dispute between parties to any such assignment shall operate to relieve Lessee from performance of any
'~ r4 terms or conditions hereof or to postpone the time therefor. Lessor shall at all times be entitled to
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• look solely to Lessee or his assignee shown on its books as being the sole owner hereof, and for the
co sending of all notices required by this lease and for the performance of all terms and conditions cOZ n
hereof.
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N H (d) Although not binding on Lessor, all instruments of every kind and nature whatsoever affecting
o this lease should be filed with the Lessor.
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o W 10. OVERRIDING ROYALTY - Any and all reservations or assignments or overriding royalties shall be
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N ri' subject to approval by Lessor. The total of said overriding royalties shall not exceed five percent (5%),
cn Z including any overriding royalty previously provided for unless production exceeds a monthly average of
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fifteen (15) barrels per day or ninety thousand cubic feet of gas per day (90 MCF/D). In the event that
o production drops to this amount or less, any overriding royalties which exceed five percent (5%) may be
U P4 suspended. Lessor's approval of a reservation or assignment of an overriding royalty shall not bind Lessor
afor 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.
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H 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
P3 44
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 ray at any time or times pool any part or all of said land and 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 pattern or to comply with any order, rule,
or regulation of the State or Federal regulatory or conservation agency having Jurisdiction. Such pooling
(Rev. 11/86) - -
880094
shall be accomplished or terminated by filirg; 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
m O purposes of this lease as operations or productions from this lease. Lessee shall allocate to this lease
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o the proportionate share of production which the acreage in this lease included in any such spacing unit
NC) bears to the total acreage in said spacing unit.
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• 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
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o S conform to such agreement. When only a portion of the land under this lease is committed by an agreement,
o C4 Lessor may segregate the land and issue a separate lease for each portion not committed thereunder; the term
for W of such separate lease shall be limited as to the original term of this lease. The terms of the lease on
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Q•' that portion remaining in the unit shall be deemed to be modified to conform to such agreement.
(Oj Nonproducing leases shall terminate on the first anniversary date of the lease following the termination
adate of the unit or part thereof modifying the lease, but in no event prior to the end of the primary term
0 of the lease or the extension term of the lease.
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• 15. PRODUCTION - Lessee shall, subject to applicable laws, regulations and orders, operate and produce
a all wells upon the leased land so long as the same are capable of producing in paying quantities, and shall
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co u operate the same so as to produce at a rate commensurate with the rate cf production of wells on adjoining
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lands within the same field and within the limits of good engineering practice, except for such times as
•-+ H there exist neither market nor storage therefor, and except for such limitations on or suspensions of
NH production as may be approved in writing by Lessor. Lessee shall be responsible for adequate site security
o a on all producing properties.
rn a 16. SHUT-IN WELLS - If Lessee shall complete a well on the leased land productive of gas and Lessee is
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N G+ unable to produce such gas due to a lack of suitable market therefor, Lessor may grant Lessee suspension of
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• 2 his obligations to produce hereunder until a suitable market for such gas can be found, and during any such
N < suspension period, it shall be deemed that gas is being produced hereunder in paying quantities. Except,
o • however, that beginning on the anniversary date next, of the year of an extension of the lease by reason of
1U 1:4a shut-in well, Lessee shall pay to Lessor a shut-in royalty equal to $2 per acre of the lease per annum in
i41 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
m N which the well begins production. The maximum extension of the lease, due to the existence of a shut-in
owell, shall be five years beyond the extension term as described in the EXTENSION paragraph herein. The
Ga 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 Cas 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.
(Rev. 11/86) 880094
Lessee shall bury pipelines below plow depth. Lessee shall set and cement sufficient surface
casing to protect the fresh water wells of the area.
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o U 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
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U Lessor before commencing to plug and abandon any well by copy of Lessee's request for approval or sundry
q notice of intent to plug end abandon.
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0 $ 19. BONDS - Lessee shall be liable for all damages to the surface of the land, livestock, growing
p crops, water wells, reservoirs, or improvements caused by Lessee's operations on said land. No operations
Qshall be commenced on the land hereinabove described unless and until Lessee shall have filed a good and
Z sufficient bond with Lessor, in an amount to be fixed by Lessor, to secure the payment for such damages as
O 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
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o bond may be held in effect for the life of production of any well.
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H x 20. SETTLLT:1:17T - Lessee shall not remove any machinery, equipment or fixtures placed on said land,
W other than drilling equipment, nor draw the casing from any well unless and until all payments and
co obligations currently due Lessor under the terms of this lease shall have been paid or satisfied. Any
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machinery, equipment or fixtures left on this land for a period of more than six (6) months after the
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.-i H expiration hereof, shall automatically become the property of Lessor.
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o wl 21. OTHER DISCOVERY - Should Lessee discover any valuable products other than oil and gas, on or
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is) within the leased land, Lessee shall within seven (7) days report such discovery to Lessor, in which event
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W Lessee and Lessor may negotiate a provision for production of such discovery.
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t� Z 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
o surface owner, said permission shall not be unreasonably withheld. If Lessee desires to establish or
U LZ 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 nontributary water
rights established on the leased land which may be put to beneficial use off said land.
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H 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
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and gas operations, Lessor is hereby authorized upon notice and hearing, as hereinafter provided, to cancel
this lease as to all of the leased lane 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
cancelled 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 temp hereof, or during drilling operations commenced during the primary term
hereof, Lessee may make written application to Lessor for an extension of this lease for a term equal to the
primary term as to all of the mineral acres covered hereby (excluding any mineral acres theretofore
surrendered as in the SURRENDER Paragraph provided, or assigned as in the ASSICNNENTS Paragraph provided).
The granting of such extension shall be at the sole option of Lessor at double the rental for the primary
term hereof.
8S009,-
(Rev. 11/86)
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C.) 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
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0 3 leased land or by conditions created thereby, or based upon any violation of any statute, ordinance, or
o a regulation.
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a 26. CONDEMNATION - If the leased land shall be taken in any condemnation proceeding, this lease shall
O• automatically terminate as of the date of taking. The award for such condemnation shall be paid to Lessor,
N except for any specific award(s) paid to Lessee for severed oil and gas reserves, in which event
0 of such specific award(s) shall be paid to Lessor in lieu of royalty lost by virtue of the
" .45 condemnation. Improvements shall be removed by Lessee per terms in the SETTLEMENT Paragraph herein. If
.-t 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.
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27. ERRORS - Every effort is made by Lessor to avoid errors in all procedures including but not
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H limited to auction listings and lease preparation. Lessor shall not be liable for any inconvenience or loss
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�w caused by errors which may occur. Lessee shall notify Lessor immediately upon discovery of any errors or
ou) discrepancy whatever.
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28. ARCHAEOLOGY - Lessee shall not destroy, disturb, mar, collect, remove or alter any prehistoric or
N k, historic resources of any kind on Weld County lands as provided by law. These resources include but are not
M 2 limited to all artifacts of stone, wood or metal, pictographs, structures, and bones. A discovery of
Z anything of prehistoric or historic nature shall be reported to Lessor or the State of Colorado
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o Archaeologist immediately.
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a 0 29. DEFINITIONS -
1/40 N (a) "Gas" as used herein shall mean all gases (combustible and noncombustible), including but not
con
o limited to all gaseous hydrocarbons, gaseous compounds, carbon dioxide, and helium.
PI Ga (b) "Oil and gas" as used herein shall include all substances produced as by-products therewith,
ircliidi.ng 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 aay_interest herein, shall be binding upon Lessor until the same has been approved ty 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.
(Rev. 11/86)
8S0094
IN WITNESS WHEREOF, lessor has hereunto signed and caused its name to be signed by the BOARD OF COUNTY
COMMISSIONERS OF THE COUNTY OF WELD, with the seal of the office affixed, and Lessee has signed this
agreement, tLe day and year first stove written.
co O POARD OF COUNTY COMMISSIONERS
C>U WELD L , COLORADO
Ca CD X
—dam
o X ATTEST: _
o 7. 7 r
sa O Weld County Clpt ng{ncorder If .
W• and Clerk to the, B d '
r.. a .,By
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LESSEE: G l We C hit O\L W W .
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o a STATE OF COLORADO )
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co• w COUNTY OF WELD
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m 2 The foregoing instrument was acknowledged before me this ' U day of (�,UM/�
7,1 Fl 19 Ry by
C.) my hand and official seta/l. dy O0100 ` .
•••
My Commission Expires: % — 1 (1—`1/4O CO
CON '"n • vet
Notary Public ?.. .Off.
4 '343•Ps
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(Rev. 11/86)
TUCKER & VAUGHT
ATTORNEYS AT LAW
WILLIAM TUCKER February 4, 1988 SUITE 1330
718 SEVENTEENTH STREET
BANK WESTERN BUILDING
GEORGE G.VAUGHT,JR. �I DENVER.COLORADO 80202
t"��P1- GG (3031571.5291
}t' tiff
Weld County Board of ----1-1-AL.,1711h
County Commissioners FEB 01988 #j
c/o Tom David, Esq . (P
P .O. Box 1948,.
Greeley, Colorado 80632 + AF:ELM, c:o1_O
Re: Oil and Gas Lease
3 .49 Acre Parcel in N/2 of Section 24-T6N-R67W
Weld County, Colorado
Dear Mr. David :
On behalf of Blue Chip Oil, Inc . , we respectfully request
that the Board of County Commissioners waive the bidding
procedures for obtaining an Oil and Gas Lease covering a 3.49
acre tract in the N/2 of Section 24-T6N-R67W. This tract is more
particulary described in the enclosed Quitclaim Deed.
Immediately following the Board ' s approval of a waiver (and
humbly assuming it will be granted) , Blue Chip Oil, Inc. will pay
the $200. fee for a three (3 ) year Oil and Gas Lease with a
one-eighth ( 1/8 ) landowner royalty, and covering a 3 .49 acre
tract in the N/2 of Section 24-T6N-R67W.
Thank you for your assistance and please call if you have
questions.
Very truly yours,
h—la"--"Wjef\-1—
George G. Vaught, Jr.
GV/tf
cc : Ms. Lauretta Flack
Enclosure
880.991
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