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AH21,31428
RESOLUTION
RE: APPROVE REQUEST OF WILLIAM G. CREWS, ON BEHALF OF CACHE
EXPLORATION, INC. AND CONQUEST OIL COMPANY, TO AMEND LEASE ON
SECTION 12 TOWNSHIP 5 NORTH, RANGE 65 WEST OF THE 6TH P.M. ,
WELD COUNTY, COLORADO
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~• 0 WHEREAS, the Board of County Commissioners of Weld County,
0 Colorado, pursuant to Colorado statute and the Weld County Home
n Rule Charter, is vested with the authority of administering the
o w affairs of Weld County, Colorado, and
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▪ W WHEREAS, the Board did, by Resolution dated December 11 ,
2 1985 , approve an Oil and Gas Lease with Cache Exploration, Inc.
o and Conquest Oil Company, covering certain mineral acres located
d, a in the Si , Section 12 , Township 5 North, Range 65 West of the 6th
P.M. , Weld County, Colorado, and
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aWHEREAS, William G. Crews, on behalf of Cache Exploration,
co coo Inc. and Conquest Oil Company, has requested that certain
• z amendments be made to said lease, and
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o a WHEREAS , after study and review, the Board finds that good
W cause exists to amend said lease.
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M Z NOW, THEREFORE, BE IT RESOLVED by the Board of County
c.1 ,4 Commissioners of Weld County, Colorado, that said Oil and Gas
• Lease be , and hereby is , amended as follows:
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1 . Delete the following from Section 8 (SURRENDER) : "provided
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coin that no partial surrender or cancellation of this lease shall be
„ No for less than continguous tracts of approximately forty (40) acres
or Governmental lot corresponding to a quarter-quarter section; "
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2 . Delete Section 9 (ASSIGNMENTS) in its entirety and replace
with a new section 9 (ASSIGNMENTS) which reads as follows :
9 . ASSIGNMENTS: The rights of Lessor and Lessee hereunder
may be assigned in whole or in part. No change in ownership
of Lessor' s interest (by assignment or otherwise) shall be
binding on Lessee until Lessee has been furnished with
notice, consisting of certified copies of all recorded
instruments or documents and other information necessary to
i f ccoi ee - 880112
Page 2
RE: AMEND LEASE - CACHE EXPLORATION, INC. AND CONQUEST OIL CO.
establish a complete chain of record title from Lessor, and
o v then only with respect to payment thereafter made. No other
N o kind of notice, whether actual or constructive, shall be
binding upon Lessee. No present or future division of
a Lessor' s ownership as to different portions or parcels of
o w said land shall operate to enlarge the obligations or
0 3 diminish the rights of Lessee, and all Lessee' s operations
o a may be conducted without regard to any such division. If all
`n- q or any part of this lease is assigned, no leasehold owner
shall be liable for any act or omission of any other
o leasehold owner.
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x3 . Delete Section 10 (OVERRIDING ROYALTY) in its entirety.
w o 4 . Delete Section 18 (BONDS) in its entirety.
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N F 5 . Add new Section 13 . 1 which reads as follows :
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13 . 1 POOLING: Lessee may at any time or times pool any part
co w or all of said land and lease or any stratum or strata with
• w other lands and leases , stratum or strata in the same field
• z so as to constitute a spacing unit to facilitate an orderly
N 4 or uniform well-spacing pattern or to comply with any order,
rule or regulation of the State or Federal regulatory or
u ; conservation agency having jurisdiction. Such pooling shall
a be accomplished or terminated by filing of record a
declaration of pooling, or declaration of termination of
co Ln pooling, and by mailing or tendering a copy to Lessor. Any
o unit may include land upon which a well has theretofore been
w w completed or upon which operations for drilling have
theretofore been commenced. 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
production 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.
BE IT FURTHER RESOLVED by the Board that the aforementioned
amendments be, and hereby are, retroactive to December 11 , 1985 .
880112
Page 3
RE: AMEND LEASE - CACHE EXPLORATION, INC. AND CONQUEST OIL CO.
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Inc) The above and foregoing Resolution was, on motion duly made
and seconded, adopted by the following vote on the 8th day of
a A February, A.D., -4988 .
0 3 BOARD OF COUNTY COMMISSIONERS
w ATTEST: / W�/� COUNTY, COLORADO
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9 .R A #.124.1 vYi_
p Weld C nt ecorder
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and Cl iz 47B lene R. Brantner, Chairman
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" BY_. C.W. Kirby" , Pro m
Weputy lerk
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coV APPROVED S TO FORM: J cq ' n son
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c County Attorney
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880112
WILLIAM G. CREWS, CPL
OIL AND GAS
1223 28TH AVENUE. SUITE 2
GREELEY COLORADO 80631
[�_ _ - (303)351 0733 GREELE
(303)659 7710 DENVER January 25, 1988 t
JAN 2 51988
Clerk to the Board of
Weld County Commissioners _:._.,_._y
Centennial Building
915 10th. Street
GLeeley, CO 80631
This is to request a hearing on Wednesday, January 27 at 9:00 a.m. before the
Board of Weld County Commissioners for the following:
1. Request amendment, on behalf of The Robert W. Gerrity Company and
Snyder Operating Partnership L.P. , of Weld County Oil and Gas Jean dated
August 5, 1987 covering portions of the W%, of Section 27, Township 4 North,
Range 64 West. '
2. Request amendment, on behalf of Silverado Oil, Inc. , Cache
Exploration, Inc. , and Conquest Oil Company, of Weld County Oil and ('as Jeacc+
dated December 19, 1985 covering portions of the S=, of Sec.Lion 12, Township 5
North, Range 65 West.
3. Request waived-bid paid-up oil and gas leaae from Weld County
covering less than two total acres in NW;NW; of Section 5, Township 4 North,
Range 65 West (Lots in Herrington's Addition, Town of Jasalle) . This is
basically a continuation of a previous request.
I will have met with Tom David concerning all three requests prior to the
meeting on January 27.
Your scheduling of my appearance before the Board will be sincerely
appreciated.
Cordially,
William G. Crews, CPL
cc: Thomas David, Esq.
County Attorney
Weld County
WSC/mm
880092
880112
•
January 26, 1988 WILLIAM G. CREWS, CPL
OIL AND GAS
Mr. Tan David 0'23 20TH AVENUE.SUITE 2
County Attorney - _ - GREELEY COLORADO 80831 -
LeldCounty - 1301).i5I 0733 GREELEY
(303)659 7710 DENVER
Centennial Building
910 10th. Street
Greeley, CO 80631
near Tom:
RE: Oil and rag Tea a dated December 19, 1985
County/Cache Exploration, Inc. and Conquest Oil Company
Parts of N'SE' and SE;SW;-Sec. 12-4n-65w
Recorded in Book 1199 under Rec. No. 2039432
As shown on the attached plat, the parcel covered by the captioned lease is
irregular and does not cover, by itself, one legal spacing unit. Conquest and
Cache pooled the lea a with other leases to form a unit for Codell and
Niobrara production consisting of the N=,SE's of SeLLion 12. They then each
assigned all of their interest as to the NW;SE; to CEI Law #1-85 Joint Venture
and as to the NENSE1/2 to Conquest 85, Ltd. By other assignments, Conquest Oil
Company now owns the lease as to the SENSW;, and Silverado Oil, Inc. owns the
NW`,NE`,. Conquest and Silverado Oil, Inc. have pooled the E;SW; to form a
Codell/Niobrara unit.
The lease also covers only a right-of-way in the SE;SW; and as such may not
cover a valid mineral interest. In looking at the County lease, pooling with
other leases as to that part in the SE',SW; (if indeed the lease covers a valid
mineral interest) , or a release (if not valid) are not Tensible without a
lease amendment. The rights to release or assign less than a 40-acre tract
are expressly prohibited.
Also, the County lease is not an "unless" lease. The lease requires a rental
even if production ensues, and does not forfeit if a rental is not paid or is
not timely paid. The rental should be payable until the lease is drilled, but
not thereafter.
Additionally, a bond might be necessary if the EllSW' were first pooled and a
well then drilled on the lands. Once pooled, operations on any lands within
the pooled area are operations on lands covered by the County lease, and it
would seem that the bond requirement, although not intended to be applicable,
world apply.
Another onerous clause is that dealing with shut-in gas royalty. It calls for
a minimum shut-in gas royalty of $240, not proporationately reduced. If any
existing or subsequent well in either the NOSE' or El5SW$ were shut-in, the
lessee would be liable for $240 per year on total acreage of approximately 4
acres. . .an average of $60 per acre or sixty times the normal rate.
To solve these problems, I suggest that the Commissioners pans a resolution,
applicable to any lease on this form (Rev. 2/85) along the lines of the
proposed resolution attached to this letter.
880112
January 26, 1988
Tom David
Page 2
Once adopted, a copy of such resolution mould be sent to each operator
requesting, for example, approval of an assignment, and the operator would
need take no further action, thus sparing the County the time and expense of
amending each lease as a similar problem aricco.
P1Pawn let me know if any additional information is . needed. The
Commissioners' consideration of such a resolution will be sincerely
appreciated.
Cordially,
William G. Crews, CPL
Agent for Conquest Oil Company, Cache
Exploration, Inc. and Silverado Oil, Inc.
WGC/mm
880112
RESOLUTION
RE: APPROVE REQUEST OF WILLIAM G. CREWS TO AMEND ALL WELD COUNTY OIL AND GAS
- LEASES ON FORM (REV. 2/85)
WHEREAS, the Board of County Commissioner 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, the above cited lea form contains cla»^r" which are
inapplicable to situations when a Weld County leap covers more or less than
one single spacing unit, or which cause lec nn unnecessary problems as a
result of such claim= which are not deemed to be in the best interest of both
lessor and 1Pacee, and
WHEREAS, after review, the Board of County Commissioners found that good
cause exists for amending all Weld County oil and gas lnas'3s on form (Rev.
2/85) .
NOW, THEREFORE, BE IT RESOLVED by the Board of Weld County Conanissioners
that the following amendments be, and are hereby, approved as to all such Weld
County oil and gas lPa :
1. Add the following to unnumbered paragraph two, which begins "SEAS,
said IPtgae has applied to Lessor for an oil and gas lease. . . ,": " Such
annual rental shall not be due for any year during which Tea-PP shall have
commenced a well on the lands covered by this 1Paae, or on lands pooled
therewith, and shall not be due during the time any well is producing
(including shut-in wells) upon lands covered hereby or lands pooled
therewith".
2. Delete the following from Section 8 (SURRENDER) : "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
correapunding to a quarter-quarter section;"
3. Delete SeuLion 9 (ASSIGNMENTS) in its entirety and replace with a new
Section 9 (ASSIGNMENTS) which reads as follows:
9. ASSIGNMENTS. The rights of Lessor and Lessee hereunder may be
assigned in whole or in part. No change in ownership of Lessor's interest (by
assignment or otherwise) shall be binding on Lessee until TPCSPP has been
furnished with notice, consisting of certified copies of all recorded
instruments or documents and other information necessary to establish a
catplete dhain of record title from Lessor, and then only with respect to
payment thereafter made. No other kind of notice, whether actual or
constructive, shall be binding upon IPc- PP. No present or future division of
Lessor's ownership as to different portions or parcels of said lard shall
operate to enlarge the obligations or diminish the rights of In no, and all
IPccna's operations may be conducted without regard to any such division. If
all or any part of this lease is assigned, no leasehold owner shall be liable
for any act or omission of any other leasehold owner.
4. Delete Section 10 (OVERRIDING ROYALTY) in its entirety.
880112
y. Delete the following fran Section 15 (SHUT-IN WELLS) : "in addition to the
annual rental."
6'. Delete the following sentence from Section 15 (SHUT-IN WELLS) : "The
minimum amount of such shut-in royalty Shall be $240".
7. Delete Section 18 (BONDS) in its entirety.
8. Renumber Section 13 (UNITIZATION7NITIZATION) as Section 13.2.
9. Add new Section 13.1 which reads as follows:
13.1 POOLING. 7eccee may at any time or times pool any part or all of
said lard and lease or any stratum or strata with other lands and leap,
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 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. Any unit may include
land upon which a well has theretofore been completed or upon which operations
for drilling have theretofore been commenced. Drilling or reworking
operations upon or production fran any part of such spacing unit shall be
considered for all purposes of this lease as operations or production fran
this linage. Teasee shall allocate to this leases the proportionate share of
production which the acreage in this learn included in any such spacing unit
bears to the total acreage in said spacing unit.
All amendments above described shall be retroactive to the effective date
of each involved lease.
The above and foregoing Resolution was, on motion duly made and seconded,
adopted by the following vote on the _ day of January, 1988.
880112
. REESE ENGINEERING
Job_CREWS= LAW --__ _ Job No. 1986-44 Date MAR. 181_1986
Legal Description --
14._1L2—S EJ/4 Section -- -- 12 _Township _ 5 N _Range 65W
ACREAGE___ALLOCATION
SCALE FOR QUARTER SECTION
400 Ft=I inch
:TR. S.88°02'09" E N 2690.82' E.1/4C,
COR. / 12-5-
3.62± AC.
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N. 1/2 S E. 1/4
TOTAL = 1.22± AC.
aN +
LAW PARCEL = 77.60± AC, in
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W I N.88°02'15"W 2690.
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9. 1/4 COR. S
SCALE FOR QUARTER QUARTER SECTION 8801.12
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