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Home My WebLink About920825.tiff ARdit12fl3.5 RESOLUTION RE: AUTHORIZATION OF OIL AND GAS LEASE COVERING CERTAIN PROPERTY OWNED BY WELD COUNTY, COLORADO, LOCATED IN SECTION 3, TOWNSHIP 7 NORTH, RANGE 58 WEST 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, a portion of said mineral acres not currently leased was put up for bid to lease, and WHEREAS, Skaer Enterprises, Inc. , P.O. Box 22418, Denver, Colorado 80222, submitted the high bid to lease 130.2 net mineral acres, more or less, described to-wit, with said legal description being more fully described in Exhibit "A" to the attached lease: Section 3, Township 7 North, Range 58 West of the 6th P.M. , Weld County, Colorado WHEREAS, it is the intention of the lessor to lease to the lessee any and all lands it owns within the NE'-,-, and EkNW'-, of Section 3, Township 7 North, Range 58 West, 6th P.M. , and WHEREAS, Weld County desires to accept the high bid offer submitted by Skaer Enterprises, Inc. , to lease the above described mineral acreage for $11.75 per net mineral acre, for a total sum of $1,529.85 together with a rental fee of ONE DOLLAR ($1.00) per net mineral acre, which lease is to run for a period of three (3) years, commencing August 26, 1992, and ending at 12:00 noon on August 26, 1995, 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 Skaer Enterprises, Inc. , P.O. Box 22418, Denver, Colorado 80222, be, and hereby is, accepted for a period of three (3) years with the total sum being as above listed. B 1349 REC 02302015 09/01/92 12 :36 $0.00 1/012 F 1485 MARY ANN FEUERSTEIN CLEERK & RECORDER WELD CO, CO 920825 rn / / I pt,„ pol�',[ 0 � 5jiA (&l ,l OIL AND GAS LEASE - SKAER ENTERPRISES, INC. (S3, T7N, R58W) PAGE 2 The above and foregoing Resolution was, on motion duly made and seconded, adopted by the following vote on the 26th day of August, A.D. , 1992. BOARD OF COUNTY COMMISSIONERS ATTEST: WELD CO NTY, COLORADO Weld County Clerk to the Board Geo e Kenn y, Chairman BY: ,74,-4-0' f /L---7 ,,$ a rt / �4�/��A�wJ�i(Y Jy6Cru Deputy,Clerk Tto the Board_ N Constance L. Harber , Pro-Tem - APPROVED AS TO M: > C. W. Kirb ' County Attorney Gordo . c W. H. Webster B 1349 REC 02302015 09/01/92 12 :36 $0 .00 2/012 920825 F 1486 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO EXHIBIT "A" • Range 58 Township 7 Section 3NWI All that part NW! South of Railroad right-of-way SISE;NW; North of Railroad right-of-way South 30 acres NE;NW} except beginning 690' South of northeast corner of NWI,West 400' , South 112' , East 400' , North 112' to beginning N;SE,NW; NINtNE}NW} except 3 acres on East end Part NE;NW; beginning at point 392.4' West of northeast corner, South 328.7' , East 392.4' , North 328. 7' ,West 392.4' to beginning Range 58 Township 7 Secion 3 NE} Part SINE} beginning 799.2' East and 330' North of center of Section 3, East 390' , North 55' , West 390' , South 55' to beginning That part NE} beginning at center of Section 3, East 799.2' , North at right angles to public highway southwesterly along highway to North and South centerline of Sec to beginning Beginning 799.2' East and 495' North of center of Section 3, East 390' , North 55' , West 390' , South 55' to beginning That part NE& beginning 550' North and 1,189' East of center of Section 3, North 116' , southwesterly parallel to the CB&Q railroad right-of-way 115.9' , westerly 37' , South 110' , East 150' to beginning Beginning 799.2' East and 440' North of center of Section 3, East 390' , North 55' , West 390' , South 55' , to beginning It is the intention of the Lessor to lease to the Lessee all of the Mineral Interest it may own within the lands described herein and more particularly described as follows: Township 7 North, Range 58 West, 6th P.M. Section 3: NE/4, E/2NW/4 Weld County, Colorado Signed for Identification Purposes only: Weld County Board of Commissioners Skaer n rises, Inc. By. �q�� By: �E. Skaer, Vice President B 1349 REC 02302015 09/01/92 12 :36 $0 .00 3/012 F 1487 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO 9':0825 EXHIBIT "A" SECTION 3, TOWNSHIP 7N, h.,aGE 58W Original Town of Raymer Block 7 Lots 3, 4, 5, 6 Block 8 Lots 5 and 6 Block 9 Lots 1 - 5 Block 10 Lots 3 and 4 Addingtons Addition to the Town of Raymer Block 1 Lots 4 - 9, 14, 15, 18 Block 2 Lot 5 Block 5 All Block 6 Ei Block 7 Wi Block 9 NI and SE; Block 10 All Beginning 60' North of northeast corner of Lot 12 Block 1, North 37' , southwesterly along Railway Street 120.3' , East 114.4' to beginning Baldwin and Whittiers Addition to the Town of Raymer Block 1 Lots 3 - 6 Block 2 Lots 15 -18 Block 3 Lots 1 - 12, 16 - 18 Block 4 All Block 5 Lots 1 - 3, 5 Block 6 Lots 1, 2, 4 - 6, 10, 13 - 18 Block 7 Lots 7, 9, 10, 14 - 18 Block 10 Lots 10 - 14, 18, 19 Block 11 Lots 3 - 6, 12 - 23 Block 12 Lots 2S?, 3, 5Si, 6 Block 13 Lots 1 - 5 Peckhams Addition to the Town of Raymer Block 1 Lots 7 - 12 Block 4 Lots 7 - 12 Block 5 Lots 7 - 12 Block 8 Lots 7, 8, 10, 11 Block 9 Lots 6 - 9 Block 12 Lots 7, 851, 10, 11Si Block 13 Lots 6 - 12 Block 14 Lots 1 - 19 Block 15 Lots 1 - 12 Block 16 Lots 7 - 12 Block 17 Lots 1 - 12 Block 18 Lots 1 - 3, 7 - 12 Block 19 Lots 1 - 12 Block 20 Lots 13 and 14 Block 21 Lots 7 - 12 Block 23 Lot 1 Block 24 Lots 3 - 12 Block 25 Lots 1 and 2 Block 26 Lots 1 - 12 Block 27 Lots 1, 2, 7 - 12 Block 28 Lots 3 - 12 Block 29 Lots 1 and 2 Block 30 Lots 1 - 3 B 1349 REC 02302015 09/01/92 12: 36 $0 .00 4/012 970:325 F 1488 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO Parcel No. 7 WELD COUNTY OIL AND GAS LEASE Containing 130.2 acres, more or less: Containing 130.2 net mineral acres, more or less: EELS LEASE ACRZ__M'+,T, dated this ;-Q6 -- day of +1../ .�4 4e/fAit , 19a9—, made and entered into by and between WELD COUNTY, COLORADO, a political subdivision of the STAYS OF COLORADO, acting by and through the BOARD OF COUNTY COltfISSIONERS OF TE COUNTY OF WELD, for its respective interests, c/o BOARD OF COUNTY CQ2CSSIONERS, VELD COUNTY MT NNIAL Mal, 915 10TH STREET, CRAihiY, CO 80631, hereinafter called Lessor, and: Skaer Enterprises, Inc. P.O. Box 22418 Denver, Colorado 80222 hereinafter called Lessee: WIINESSETE WHEREAS, said Lessee has applied to lessor for an oil and gas lease covering the lend herein described, and has paid a filing fee in the amount of $10.00, plus a bonus consideration of $11•75 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 $ 130.20* , computed at the rate of $ 1.00* , per mineral acre or fraction thereof per year, and tba following consideration: WLREAS, 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 o₹ drilling for, development of and production o₹ 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 limes, tails and fixtures for producing and caring for much 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, tie' following described land situated in the County of Weld, State of Colorado, and more particularly described as follows: See Exhibit "A" Attached hereto and made a part hereof. DESCRIPTION OF LAND SECTION TOWNSHIP RANCE SEE ATTACHED LIST 3 7N 58W 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 _ day of , 19_ as primary tan, and so long thereafter as ail and gas, or either of than, 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 tans 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 rce 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 n-establishing the ant, and provided further that such production is commenced during such primary tan or any extension thereof, or while this lease is in force by reason of such drilling or reworking operations or other production. (Revised 5/91) 1 920625 B 1349 REC 02302015 09/01/92 12 :36 $0 .00 5/012 (5111F 1489 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO EEPLORAT20N - Lessor reserves the right to conduct exploration on the leased land provided such exploration does not interfere with rights granted herein. In consideration of the premises, the parties covenant and agree as follows; 1. RECTAL - If this lease is extended for an additional term as provided for in the E3IINSION paragraph hereof, Lessee shall pay to Lessor the sum of One Dollar (51.00) 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, is 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 prime 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 lass 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 casicghead 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 tares of any such agreement shall operate to male 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 takes its royalty in kind. With sixty (60) days' notice to Lessee, Lessor may cease taking gas royalty In kind. C. A11 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 Leaaor. 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. 920325 (Revised 5/91) 2 B 1349 REC 02302015 09/01/92 12 :36 $0 .00 6/012 F 1490 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO 1. RECORDS - Lessee agrees to keep and to have in possession complete and accurate books and records shoving 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 furnish 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. 4. MEASUREMENTS - All production shall be accurately measured using standards established by the American Gas Association (AGA) and/or tba American Petroleum Institute (API) and all measuring devices shall be tamperproof 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. PAMDINTS AND REPORTS - All payments and reports due hereunder shall be made on or before the day such payment, and reports are dua. 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 lane 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 Veld, and to laws, rules and regulations governing oil and gas operations in Colorado. Violations shall result it 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. R. SURRENDER - Lessee may at any time, by paying to Lessor all amounts then due as provided herein, surrender this lease insofar u 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 ho partial surrender or cancellation of this lease shall be for less than contiguous tracts of approximately forty (40) acres or Governmaatsl 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 may of its terms expressed or implied. In no case shall any surrender be effective until lessee shall have mada full provision for conservation of the leased products and protection of the surface rights of the leased land. 920325 (Revised 5/91) 3 B 1349 REC 02302015 09/01/92 12 :36 $0 .00 7/012 F 1491 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO 9. AS5ICNY.ENTS - 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 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. 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 fro mall 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 recognised 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 leases 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 perforoance of all terms and conditions hereof. D. Although not binding on Lessor, all instroments of every kind and nature whatsoever affecting this lease should he 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 (52), 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 par day (90 .".F/D). In this 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. Dm= WEIS - Lessee agrees to protect the leased lac0 from drainage by offset wells located on adjoining lands not owned by Lessor, vhsn 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. DEVEIOPlG]LT - 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 rats and to an extent commensurate with the economic development of the field in which the leased land lies. 920525 (Revised 5/91) 4 B 1349 REC 02302015 09/01/92 12 :36 $0 .00 8/012 F 1492 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO 13. POOLING CLAUSE - Lessee may at any time or times pool any par- or all of said land or lease or any stratum or strata with other lands and 1 , stratum or strata, in the same field so as to constitute a spacing unit to facilitate en orderly or uniform well-spacing patter 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 - COMMITIZLTION - In the event Lessor permits the land herein leased to be included within a eomssonitizatioa or unitization agreement, the teas 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 agreement, Lessor any segregate the land and issue a separate lease for each portion not conmitted 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. Nonproducing 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. 13. PRODUCTION - lasses shall, subject to applicable laws, regulations and orders, operate and produce all wells upon the leased land so long as the sane are capable of producing in paying quantities, and shall operate the same so as to produce at ► rata conmeasurate 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 was - If Lessee shall complete a well on the leased land productive of gas end 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 shat-in well, Lessee shall pay to Lessor a shut-in royalty equal to 22.00 per acre of the lease per steam in addition to the annul 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 maxisasa 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 E3SDTSION 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 feat of say 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 posed through, the depth at which each formation was reached, the number of feet of each size casing set in each well, where mat, 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 tun; �+r�'!! (ievimed 5/91) 5 3t �a tAGseJ B 1349 REC 02302015 09/01/92 12 :36 $0 . 00 9/012 F 1493 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO end also a copy of all drill stem teat 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 an required by the following paragraph, and provided that all such information is imediately available to Lessor. Any proprietary information so submitted shall not be subject to public inspection under Colorado law. lasses shall bury pipelines below plow depth. Lessee shall set and cement sufficient surface casing to protect the fresh water wells of the area. IS. NOTIFICATION - Lessee shall notify Lessor and the surface 1 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. 19. BONDS - Lessee shall be liable for all damages to the surface of the land, livestock, growing crops, eater 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 Dave filed a good and sufficient bond with Lessor, in an amount to be fined 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. STTU3RT - 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. OTH_TR 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 eater 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 Uri 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. 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 ea hearing, as hereinafter provided, to cancel this lease as to all of the leased land so claimed or pm d by 1 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 leases 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 rrty (30) days frail the data of mailing said notice, Lessee shall correct such failure or default, no cancellation will be made. Iffy such (Revised 5(91) 6 32©&2; B 1349 'REC 02302015 09/01/92 12 :36 $0 .00 10/012 F 1494 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO is:lure or default is not corrected within thirty (30) days after the mailing of such notice, and if lessee does not request a hearing on such notice within thirty (30) days, this less, will terminate and be canceled �ry opera:L,a of this paragraph without further action by Lessor, or further notice to Lessee. 24. flfli$_OR - If Lessee fails to make discovery of oil sad gas, or either of them, in paying quantities during the priori term hereof, or during drilling operations commenced during the primary term hereof, Lessee may fake written application to Lessor for an extension of this lease. The granting of such extension shall be at the sole option o£ Lessor, according to the following conditions: L. No lease tea 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 ($10.00) per acre. C. The Lessee must pay to the Lessor the sum of One Dollar (31.00) per acre leased as delayed rental for the term of the extension. D. That the royalty will remain the name. 25. BOLD BARl4E$S - Lessee shall indemnify Lessor against all liability end 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. CONDE4iATlON - If the leased land shall be taken in say condemnation proceeding, this lease shall - automatically terminate as of the data 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 =Xi `,= 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 par teas in the StiTI. s�7i paragraph herein. If only a portion of the leased land is :east by condemnation, Lessor may, at its option, terminate this lease or terminate only that portion of the lease Co 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 wbatacever. - 2B. ARcaL':.lct . ;ease- shall not ,.o - dirtur` o lent slr.r . - .. _, are c L._._, remove or -+ prehistoric or historic resat tee o1 .—y kind on weld County lands as provided by yaw. These resources include, but are not limited to, all er_i:acts of stone, wood or metal, pictographs, structures, and bones. A discovery of anything of prehi.;tcric 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. (Revised 5/91) 7 B 1349 REC 02302015 09/01/92 12 :36 $0.00 11/012 A o F 1495 MARY ANN FEUERSTEIN CLERK & RECORDER WELD CO, CO 94 ''025 Pit 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 MW 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 hes in its files. There shall be no obligation on Lessor's part to purchase new or supplemental or ether 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 tine during the term of the lease. IN WITLESS VE RMF, Lessor has hereunto signed and caused its mace to be signed by the HOARD OF COMM CRtII3SIONERS OF TEE COUNTY OF VELD, with the seal of the office affixed, and Lessee has signed this agreement, the day and year first above written. BOARD OF COUNTY COf115SIONERS ArrEsr: „ / Maji WED Weld Canty Clatl to .Board/ ,�A'�•'-.'.-�°'✓!: fyLN/J p A Deputy Clerk o tLe Board 04)%). I.FssL: Skaq Ellt ises, Inc. By: L. E Skaer, Vice Presid STATE OF COI 111 át: secrtary� / !J' Denver ) as ) 03UN f OF MX The foregoing instrument was acknowledged before me this 18th day of August , 1992 by L. E. Skaer, Vice President .of Skaer Enterprises, Inc. Witness my band and official seal. • My Commission Expires: 'P11-19q1,1 Notary Public Thki • (Revised 5/91) S B 1349 7 02302015 09/01/92 12 :3` $0 .00 12/012 F 1496 MaRY ANN FEUERSTEIN CLERK & ..-,CORDER WELD CO,f0cn,7 5 THOMAS C. POULSON P.O.Box 200162 C`' `Denver, Colorado 80220 (303) 861-8500 !. . .r.. lei I January 2, 199,n, Clerk to the Board Weld County Commissioners P.O. Box 758 Greeley, Colorado 80632 Re : Nomination of lands for Oil and Gas Lease Bid Weld County, Colorado Dear Clerk to the Board : On behalf of Skaer Enterprises , Inc . , I would like to nominate the mineral rights Weld County owns within and around the Town of New Raymer , located in Township 7 North, Range 58 West, 6th P.M. To prevent an error in this request I have enclosed a copy of the exhibit from the last lease entered into by Weld County which describes these lands. Should you have any questions please contact me at either the office number above or at (303) 320-1071. Res �tf . Y. homas C. Poulson Contract Landman/Skaer Enterprises , Inc. TCP:df 92®, 25 . - • ti • 4 s'7 1793918 1` .4, Original Town of Raymer '. Block 7 Lots 3, 4, 5, 6 g4-• ='• Block 8 Lots 5 and 6 Block 9 Lots 1 - 5 Block 10 Lots 3 and 4 ,•:,�;I,��1 Addingtons Addition to the Town of Raymer Block 1 Lots 4 - 9, 14, 15, 18 -1441C 1 i Block 2 Lot 5 1 Block 5 all i7 Jl� /q/ �/ Block 6 EIS 2 .f Block 7 Wh ! Block 9 N> and SEh ! Block 10 all Beginning 60'North of northeast - {�`' • corner of Lot 12 Block 1, North 37', ,` x.. southwesterly along Railway street r -w, 120.3', East 114.4' to beginning ? ' - . tt Baldwin and Whittiers Addition to the Town of Raymer Block 1 Lots 3 - 6 Block 2 Lots 15 -18 --- .r- Block 3 Lots 1 - 12, 16 - 18 Block 4 all Block 5 Lots 1 - 3, Block 6 Lots 1, 2, 4 - 6, 10, 13 - 18 Block 7 Lots 7, 9, 10, 14 - 18 .. Block 10 Lots 10 - 14, 18, 19 Lor 6 Block 11 Lots 3 - 6, 12 - 23 Block 12 Lots 2Sy, 3, 58+, 6 Block 13 Lots 1 - 5 ., Peckhams Addition to the Town of Raymer Block 1 Lots 7 - 12 {` - - Block 4 Lots 7 - 12 Block 5 Lots 7 - 12 . v _•. . Block 8 Lots 7, 8, 10, 11 Block 9 Lots 6 - 9 Block 12 Lots 7, 8Sy, 10, 11.81/4 ..: ._i Block 13 Lots 6 - 12 . Block 14 Lots 1 - 19 Block 15 Lots 1 - 12 - Block 16 Lots 7 - 12 Block 17 Lots 1 - 12 Block 18 Lots 1 - 3, 7 - 12 B&,`ck 19 Lots 1 - 12 Bl. - 20 Lots 13, 14 . _._.,...._.._:.,: Blocw `1 Lots 7 - 12 Block <.i Lot 1 - Block 24 Lots 3 - 12 Block 25 Lots l artd 2 - Block 26 Lots 1 - 12 Block 27 Lots 1, 2, 7 - 12 • Block 28 Lots 3 - 12 • Block 29 Lots 1, 2 Block- 30 Lots 1 - 3 • �,Ar"J J_v sort 872 1793918 f . 'ht 5.3 € . r Range 58 Township 7 Section 3 NWk ; 4 s, 11 +r7 All that part NWk South of Railroad right-of-way I' S. S'}SEiNWk North of Railroad right-of-way 44' South 30 acres NEkNW4 except beginning 690' South of northeast corner of Y '4' NWk, West 400', South 112' , East 400' , North 112' to beginning ' NOSE}NWk •41 f N4N4NEkNW4 oxcept 3 acres on East end Part NE4NW4 beginning at point 392.4' West of northeast corner. South 328.7' , East 392.4'. Nprth 328.7; West 392.4' to beginning I'Va:w ::,x.,` ice' Aga- z , .1: 1. Range 5s Township Towship 7 Section 3 NEk v •I Part S§NEk beginning 799.2' East and 330' North of center of Section 3, <r:-. • ,j �\ I East 390' , North 55', West 390', South 55' to beginning 1.44 r 11r!k, That part NEk beginning at center of Section 3, East 799.2', North N rill' , at right angles to public highway southwesterly along highway to "-'.'; North and South centerline of Sec to beginning - ;: 1 //Beginning 799.2' East and 495' North of center of Section 3, East 390', ,." , 1,r / North 55', West 390' , South 55' to beginning -- '� l4 That part NEk beginning 550' North and 1,189' East of center of • liteiC•3 1.0/ Section 3, North 116', southwesterly parallel to the C1160 railroad {g / right-of-way 115.9', Westerly 37', South 110', East 150' to beginning ,:".,4 Yy. F . Beginning 799.2' East and 440' North of center of Section 3, East 390', + i* North 55', West 390' , South 55' to beginning - wY :`. Ir .I rJ1'i : ' h ti-i-1 t ,y 1 S 1{-. : 1 , • .. : w ; i THOMAS C. POULSON P.O. Box 200162 1• - o!o; 1\I Denver, Colorado 80220 (303) 861.8500 r r May 1, 1992 Weld County Commissioners P. O. Box 758 Greeley, Colorado 80632 Re : Oil and Gas Leasing Weld County, Colorado Dear County Commissioners : About a year ago I requested a tract of land be put up for bid at the Weld Oil and Gas Lease auction. As of yesterday no date had been set for the auction. My client, Skaer Enterprises, Inc. , is particularly interested in leasing a tract of land for the purpose of exploration. This tract is located within and around the Town of New Raymer . The county owns the majority of the minerals in this area . We have spent considerable time and money putting together this very detail project and would like to drill the initial well as soon as possible. Also, it is my understanding that there has been no other inquiries on this tract and therefore we would like to ask if we could lease these lands outside the form of the auction to expedite ' s process. You immediate attention to this m r woul e appreciated . Re y,7" omas C. Poulson Contract Landman/Ska r Enterprises , Inc . TCP/tp 3+002° SECTION 3, TOWNSHIP 7N, RANGE 58W Original Town of Raymer Block 7 Lots 3, 4, 5, 6 Block 8 Lots 5 and 6 Block 9 Lots 1 - 5 Block 10 Lots 3 and 4 Addingtons Addition to the Town of Raymer Block 1 Lots 4 - 9, 14, 15, 18 Block 2 Lot 5 Block 5 All Block 6 E₹ Block 7 WI Block 9 N1 and SE; Block 10 All Beginning 60' North of northeast corner of Lot 12 Block 1, North 37' , southwesterly along Railway Street 120.3' , East 114.4' to beginning Baldwin and Whittiers Addition to the Town of Raymer Block 1 Lots 3 - 6 Block 2 Lots 15 -18 Block 3 Lots 1 - 12, 16 - 18 Block 4 All Block 5 Lots 1 - 3, 5 Block 6 Lots 1, 2, 4 - 6, 10, 13 - 18 Block 7 Lots 7, 9, 10, 14 - 18 Block 10 Lots 10 - 14, 18, 19 Block 11 Lots 3 - 6, 12 - 23 Block 12 Lots 2S1, 3, 5Si, 6 Block 13 Lots 1 - 5 Peckhams Addition to the Town of Raymer Block 1 Lots 7 - 12 Block 4 Lots 7 - 12 Block 5 Lots 7 - 12 Block 8 Lots 7, 8, 10, 11 Block 9 Lots 6 - 9 Block 12 Lots 7, 8S₹, 10, 11Si Block 13 Lots 6 - 12 Block 14 Lots 1 - 19 Block 15 Lots 1 - 12 Block 16 Lots 7 - 12 Block 17 Lots 1 - 12 Block 18 Lots 1 - 3, 7 - 12 Block 19 Lots 1 - 12 Block 20 Lots 13 and 14 Block 21 Lots 7 - 12 Block 23 Lot 1 Block 24 Lots 3 - 12 Block 25 Lots 1 and 2 Block 26 Lots 1 - 12 Block 27 Lots 1, 2, 7 - 12 Block 28 Lots 3 - 12 Block 29 Lots 1 and 2 Block 30 Lots 1 - 3 920 Range 58 Township 7 Section 3NWa All that part NW* South of Railroad right-of-way S?SEINW'-,-, North of Railroad right-of-way South 30 acres NE*NWe except beginning 690' South of northeast corner of NWt,West 400' , South 112' , East 400' , North 112' to beginning N1SE,'-,NW* NIN'-,NEINW4 except 3 acres on East end Part NE*NW; beginning at point 392.4' West of northeast corner, South 328.7' , East 392.4' , North 328.7' ,West 392.4' to beginning Range 58 Township 7 Secion 3 NE; Part S;NEe beginning 799.2' East and 330' North of center of Section 3, East 390' , North 55' , West 390' , South 55' to beginning That part NE* beginning at center of Section 3, East 799.2' , North at right angles to public highway southwesterly along highway to North and South centerline of Sec to beginning Beginning 799.2' East and 495' North of center of Section 3, East 390' , North 55' , West 390' , South 55' to beginning That part NE,' beginning 550' North and 1, 189' East of center of Section 3, North 116' , southwesterly parallel to the CB&Q railroad right-of-way 115.9' , westerly 37' , South 110' , East 150' to beginning Beginning 799.2' East and 440' North of center of Section 3, East 390' , North 55' , West 390' , South 55' , to beginning tirlf 25 Hello