The URL can be used to link to this page

Browse Search

Home My WebLink About941191.tiff RESOLUTION RE: APPROVE TWO OIL AND GAS DIVISION ORDERS TO K. P. KAUFFMAN COMPANY, INC. FROM BASIN EXPLORATION, INC. AND AUTHORIZE CHAIRMAN TO SIGN 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, has received two Oil and Gas Division Orders to K. P. Kauffman Company, Inc., 1675 Broadway, Suite 1970, Denver, Colorado 80202, from Basin Exploration, Inc., and WHEREAS, said Division Orders cover land more particularly described as follows: Township 2 North, Range 67 West, 6th P.M. Section 26: NE'/ NE% (Unit B #1) and NW% NE% (Unit B #2) Weld County, Colorado Township 2 North, Range 67 West, 6th P.M. Section 26: SW% NE% (Unit C#1) and SE1% NE% (Unit C#2) Weld County, Colorado WHEREAS, Weld County is entitled to a one-eighth royalty interest on production, and WHEREAS, in order to receive said royalty interest, Weld County must execute said Division Orders, copies of which are attached hereto and incorporated herein by reference, and WHEREAS, said Division Orders have been reviewed by a member of the Weld County Attorney's staff and found to be in order, and WHEREAS,the Board deems it advisable to approve said Division Orders on the parcel of land described herein. NOW, THEREFORE, BE IT RESOLVED by the Board of County Commissioners of Weld County, Colorado, that the two Oil and Gas Division Orders to K. P. Kauffman Company, Inc. from Basin Exploration, Inc., on the hereinabove described parcels of land be, and hereby are, approved. BE IT FURTHER RESOLVED by the Board that the Chairman be, and hereby is, authorized to sign said Division Orders. 941191 LE0067 (?C : Katt'Pma, °' ; ) DIVISION ORDERS - S26, T2N, R67W PAGE 2 The above and foregoing Resolution was, on motion duly made and seconded, adopted by the following vote on the 5th day of December, A.D., 1994. BOARD OF COUNTY COMMISSIONERS ATTEST:�D��' WELD/COUNTY, COLORADO Weld County Clerk to the Board // W. H. Webster, Ch irman /BY:( .-t -t /17/0-t �-.a< . Deputy Clerk to the Board—__N Dale K. all, Pro-Tern APPROVED AS TO FORM: EXCUSED George E. Baxter r is L �� EXCUSED ounty Attorney Constance L. Harbert / /Barbara J. Kirkmeyer 941191 LE0067 AR2418831 DIVISION ORDER (COMBINED OIL AND GAS) TO: K. P. KAUFFMAN COMPANY, INC. ( "KPK" ) 1675 Broadway, Suite 1970 Denver, Colorado 80202 ATTN: Division Order Dept . Division Order No. KPK94-028 Date October 26 , 1994 The undersigned, and each of us, certify and guarantee that we are the legal owners of and hereby warrant the title to our respective interests in the proceeds derived from the sale of Oil and Gas (as more individually defined herein) produced and saved from the Weld County Unit B lease or unit located in the County or Parish of Weld, State of Colorado more particularly described as follows : Township 2 North, Range 67 West Weld County Unit B #1 Sec . 26 : NE/4NE/4 Weld County Unit B #2 Sec . 26 : NW/4NE/4 NET REVENUE WORKING CREDIT TO INTEREST INTEREST Weld County - Board of County Commissioners . 11773430 RI Lupton Meadows Ditch Co. . 00726570 RI Gerrity Oil & Gas Corp. . 27837500 WI . 325584795 WI K. P. Kauffman Co. , Inc . . 59662500 WI . 674415205 WI RI Effective 8 : 00 a.m. October 1 , 1994 , and until further notice, you are hereby authorized to take or retain possession of all Oil and Gas from said property (ies) on and after the effective day and to give credit as set forth above for all proceeds derived from the sale thereof from said property (ies) subject to the conditions, covenants and directions set out below: FIRST: It is understood that the Gas produced from the above- described property (ies) is being sold under that certain Gas Purchase and Processing Agreement dated November 8 , 1991 , between KPK as "Seller" and Associated Natural Gas Inc . as "Buyer" , and that all terms and covenants contained therein, and in any amendments , extensions, or renewals thereof shall govern and be binding upon the parties hereto in all respects which shall include , but not be restricted to, the price to be paid for said Gas and the time when such payments are to be made . As used in this Division Order, the term "Gas" shall be deemed to include casinghead gas , gasoline and all products which KPK may receive and/or recover by processing from Gas produced from wells on said property (ies) . SECOND: The word "Oil " as used herein shall include, but is not limited to, condensate and all marketable liquid hydrocarbons produced and saved hereunder, but excluding that recovered from processing of Gas . All Oil received and purchased hereunder shall be merchantable Oil and shall become the property of KPK as soon as the same is received into its custody or that of any carrier it designates . KPK shall not be expected to receive Oil in definite quantities, nor for fixed periods , nor to provide storage . - 1 - 2418831 B-1471 P-343 12/12/94 04:41P PG 1 OF 4 REC D0C Weld County CO Clerk & Recorder 0.00 941191 THIRD: The Oil received and purchased hereunder shall be delivered f .o.b. to any carrier KPK designates which gathers and receives said Oil and KPK agrees to pay for such Oil to the undersigned according to the division of interests herein specified at the price agreed upon between KPK and the lease operator. FOURTH: Quantities of Oil purchased hereunder shall be determined by the method of measurement and computation employed by KPK or KPK' s agent designated to receive such Oil including but not by way of limitation, the gauging of storage tanks using regularly compiled tank tables, the use of certified tank gauges, and the use of meters or any other reasonably accurate method of measurement and computation . KPK shall correct the volume and gravity to a temperature of 60' Fahrenheit and shall deduct from such corrected volume the full percentages of basic sediment , water and other impurities as shown by its test . KPK may refuse to receive any Oil it considers to be not merchantable . FIFTH: Payments are to be made monthly by checks of KPK for Oil and Gas to be delivered or mailed to the parties thereto entitled at the addresses above given, provided that if the amount due to any owner is less than Twenty-five and 00/100 Dollars ($25 . 00) per month, KPK at its option, may defer the making of such payment until such time as the aggregate amount due exceeds said sum. The undersigned authorize KPK to withhold from the proceeds of any and all Gas and Oil referred to herein, the amount of any tax placed thereon, or on the production thereof, including but not limited to any severance, production or occupation tax, by any governmental authority, local , state and/or federal , and to pay the same in our behalf with the proceeds so withheld. SIXTH : In the event of any adverse claim of title or in the event title shall not be satisfactory to KPK at any time during the term of this Division Order, each of the undersigned agrees to furnish complete abstracts of title and other evidence of title satisfactory to KPK and authorizes same to withhold payment without obligation to pay interest on the amount so withheld, until satisfactory indemnity shall be furnished to KPK. Each undersigned party as to the interest of such party hereunder respectively agrees, in the event suit is filed in any court affecting title to said Oil and/or Gas , either before or after severance, to indemnify and save harmless KPK against any and all liability for loss, cost , damage and expense which KPK may suffer or incur on account of receiving and paying said party the proceeds derived from the sale of said Oil and/or Gas . Where KPK, pursuant to the provisions hereof, withholds payment or any part thereof, each undersigned party from whom payment is withheld severally agrees to indemnify and hold KPK harmless of and from all liability for any tax, together with all interest and penalties incident thereto, imposed or assessed against or paid by them on account of the sum or sums so withheld from payment to said party and deduct all such taxes, interest and penalties so paid by them from any sums owing by them to said party. If suit is filed affecting the interest of the undersigned, written notice thereof shall be given KPK at the above address by the undersigned, together with a certified copy of the complaint or petition filed. If KPK is made a party to such proceedings , the undersigned agrees to indemnify same against any judgment rendered therein and to reimburse KPK for any costs , attorney' s fees or other expenses incurred in connection therewith. SEVENTH: The undersigned severally agree to notify KPK of any change of ownership and no transfer of interest shall be binding upon KPK until transfer order and the recorded instrument evidencing such transfer, or a certified copy thereof, shall be furnished to KPK. Transfer of interest shall be made effective 8 : 00 a.m. on the first day of the calendar month in which proper notice is received by KPK. KPK is hereby relieved of any - 2 - 2418S3] B-]4"-1 P-343 12/12/94 04:41P PG 2 OF 4 941191 responsibility for determining if and when any of the interests hereinabove set forth shall or should revert to or be owned by other parties as a result of the completion of discharge of money or other payments from said interests and the signers hereof whose interests are affected by such money or other payments, if any, agree to give KPK notice in writing by registered letter addressed to KPK at the above address, directed to the Division Order Department , when any such money or other payments have been completed or discharged, or when any division of interest other than that set forth above shall, for any reason, become effective and to furnish transfer order accordingly and that in the event such notice shall not be received, KPK shall be held harmless in the event of, and are hereby released from any and all damage or loss which might arise out of overpayment . Should adjustments be necessary, KPK shall have rights (but no duty) to set off any and all individual or joint liabilities the undersigned has with the same, including but not limited to proceeds from this and other lease interests owned by the undersigned. EIGHTH: If any portion of the proceeds derived from the sale of Gas is subject to refund under any order, rule or regulation of the Federal Energy Regulatory Commission or the provisions of the Natural Gas Act or Natural Gas Policy Act of 1978 , KPK may hold without interest the portion of the proceeds subject to refund unless indemnity satisfactory to KPK has been furnished, or until KPK' s refund obligation has been finally determined. If any portion of the proceeds derived from the sale of Gas is paid over by KPK under any order, rule or regulation of the Federal Energy Regulatory Commission or the provisions of the Natural Gas Act or Natural Gas Policy Act of 1978 , KPK is authorized to recover the amount of the refund applicable to the interest of each of the undersigned from future payments (Oil and Gas) or at KPK' s election, it may invoice the undersigned therefor, plus the legal rate of interest KPK is or may be required to pay in connection with undersigned' s portion of the refund. NINTH : If the undersigned is a working interest owner and/or operator, he or she guarantees and warrants that all Gas and Oil tendered hereunder has been or will be produced and delivered in compliance with all applicable federal , state and local laws, orders, rules and regulations . TENTH : This Division Order shall become valid and binding upon each and every owner above named upon execution hereof by such owner regardless of whether or not any of the other above-named owners have so signed. No termination of this Division Order shall be effective without giving thirty (30) days prior written notice . If the provisions of this Division Order are in conflict with the provisions of any oil and gas lease covering the above-described property ( ies) , the provisions of this Division Order shall prevail . Each undersigned owner ratifies and confirms his oil and gas lease as being in full force and effect as of the date hereof . In consideration of the purchase of Oil and Gas hereunder, consent is given KPK and any pipeline company which same may cause to connect with the wells and tanks on said land, to disconnect and remove such pipelines, in case of termination by either KPK or the undersigned of any purchases under this Division Order. In the event of conflict between the provisions of this Division Order and applicable law or regulations, the provisions of this Division Order shall be deemed modified so as to comply with such law or regulation . 2418831 B-1471 P-343 12/12/94 04:41P PG 3 OF 4 - 3 - 941191 zq c The undersigned expressly waive any claim against KPK for any and all amounts which may be due us from others for production prior to -{ the effective date hereof . Signatures of Owners Sign Below Taxpayer ID # Witnesses (Enter Mailing Address) Social Security # ATTESTD (®gyp{ F' 1 !J( ? ( 84-6000813 CL,ERK TO TH BOARD W. H. WEB T CHAIRMAN 12/ /94 BY:// ' C WELD COUNTY BOARD OF COMMISSIONERS DEPUTY RK OA D Address P.O. BOX 758 GREELEY, CO 80632 2418831 B-1471 P-343 12/12/94 04:41P PG 4 OF 4 - 4 - 941191 DIVISION ORDER *R2416830 (COMBINED OIL AND GAS) TO: K. P. KAUFFMAN COMPANY, INC. ( "KPK" ) 1675 Broadway, Suite 1970 Denver, Colorado 80202 ATTN: Division Order Dept . Division Order No . KPK94-027 Date October 26, 1994 The undersigned, and each of us, certify and guarantee that we are the legal owners of and hereby warrant the title to our respective interests in the proceeds derived from the sale of Oil and Gas (as more individually defined herein) produced and saved from the Weld County Unit C lease or unit located in the County or Parish of Weld, State of Colorado more particularly described as follows : Township 2 North, Range 67 West Weld County Unit C #1 Sec . 26 : SW/4NE/4 Weld County Unit C #2 Sec . 26 : SE/4NE/4 NET REVENUE WORKING CREDIT TO INTEREST INTEREST Weld County - Board of County Commissioners . 12500000 RI Gerrity Oil & Gas Corp. . 27837500 WI . 325584795 WI K. P. Kauffman Co . , Inc . . 59662500 WI . 674415205 WI RI Effective 8 : 00 a .m. October 1, 1994 , and until further notice, you are hereby authorized to take or retain possession of all Oil and Gas from said property (ies) on and after the effective day and to give credit as set forth above for all proceeds derived from the sale thereof from said property (ies) subject to the conditions, covenants and directions set out below: FIRST : It is understood that the Gas produced from the above- described property (ies) is being sold under that certain Gas Purchase and Processing Agreement dated November 8 , 1991 , between KPK as "Seller" and Associated Natural Gas Inc . as "Buyer" , and that all terms and covenants contained therein, and in any amendments, extensions , or renewals thereof shall govern and be binding upon the parties hereto in all respects which shall include, but not be restricted to, the price to be paid for said Gas and the time when such payments are to be made . As used in this Division Order, the term "Gas" shall be deemed to include casinghead gas , gasoline and all products which KPK may receive and/or recover by processing from Gas produced from wells on said property (ies) . SECOND : The word "Oil" as used herein shall include, but is not limited to, condensate and all marketable liquid hydrocarbons produced and saved hereunder, but excluding that recovered from processing of Gas . All Oil received and purchased hereunder shall be merchantable Oil and shall become the property of KPK as soon as the same is received into its custody or that of any carrier it designates . KPK shall not be expected to receive Oil in definite quantities , nor for fixed periods , nor to provide storage . - 1 - 2418830 8-14?1 P-342 12/12/94 04:41P PG 1 OF 4 REC DOC \ eld County CO Clerk & Recorder 0.00 ' -'- 9411 ` 1 THIRD: The Oil received and purchased hereunder shall be delivered f .o.b. to any carrier KPK designates which gathers and receives said Oil and KPK agrees to pay for such Oil to the undersigned according to the division of interests herein specified at the price agreed upon between KPK and the lease operator . FOURTH: Quantities of Oil purchased hereunder shall be determined by the method of measurement and computation employed by KPK or KPK' s agent designated to receive such Oil including but not by way of limitation, the gauging of storage tanks using regularly compiled tank tables , the use of certified tank gauges, and the use of meters or any other reasonably accurate method of measurement and computation. KPK shall correct the volume and gravity to a temperature of 60' Fahrenheit and shall deduct from such corrected volume the full percentages of basic sediment, water and other impurities as shown by its test . KPK may refuse to receive any Oil it considers to be not merchantable . FIFTH: Payments are to be made monthly by checks of KPK for Oil and Gas to be delivered or mailed to the parties thereto entitled at the addresses above given, provided that if the amount due to any owner is less than Twenty-five and 00/100 Dollars ($25 . 00) per month, KPK at its option, may defer the making of such payment until such time as the aggregate amount due exceeds said sum. The undersigned authorize KPK to withhold from the proceeds of any and all Gas and Oil referred to herein, the amount of any tax placed thereon, or on the production thereof , including but not limited to any severance, production or occupation tax, by any governmental authority, local , state and/or federal , and to pay the same in our behalf with the proceeds so withheld. SIXTH: In the event of any adverse claim of title or in the event title shall not be satisfactory to KPK at any time during the term of this Division Order, each of the undersigned agrees to furnish complete abstracts of title and other evidence of title satisfactory to KPK and authorizes same to withhold payment without obligation to pay interest on the amount so withheld, until satisfactory indemnity shall be furnished to KPK. Each undersigned party as to the interest of such party hereunder respectively agrees, in the event suit is filed in any court affecting title to said Oil and/or Gas, either before or after severance , to indemnify and save harmless KPK against any and all liability for loss, cost, damage and expense which KPK may suffer or incur on account of receiving and paying said party the proceeds derived from the sale of said Oil and/or Gas . Where KPK, pursuant to the provisions hereof , withholds payment or any part thereof , each undersigned party from whom payment is withheld severally agrees to indemnify and hold KPK harmless of and from all liability for any tax, together with all interest and penalties incident thereto, imposed or assessed against or paid by them on account of the sum or sums so withheld from payment to said party and deduct all such taxes, interest and penalties so paid by them from any sums owing by them to said party. If suit is filed affecting the interest of the undersigned, written notice thereof shall be given KPK at the above address by the undersigned, together with a certified copy of the complaint or petition filed. If KPK is made a party to such proceedings, the undersigned agrees to indemnify same against any judgment rendered therein and to reimburse KPK for any costs, attorney' s fees or other expenses incurred in connection therewith. SEVENTH: The undersigned severally agree to notify KPK of any change of ownership and no transfer of interest shall be binding upon KPK until transfer order and the recorded instrument evidencing such transfer, or a certified copy thereof , shall be furnished to KPK. Transfer of interest shall be made effective 8 : 00 a .m. on the first day of the calendar month in which proper notice is received by KPK. KPK is hereby relieved of any responsibility for determining if and when any of the interests - 2 - 241S330 9-14-1 P-342 12/1'/Q4 04:41P PG 2 OF 4 9.41191 hereinabove set forth shall or should revert to or be owned by other parties as a result of the completion of discharge of money or other payments from said interests and the signers hereof whose interests are affected by such money or other payments , if any, agree to give KPK notice in writing by registered letter addressed to KPK at the above address , directed to the Division Order Department , when any such money or other payments have been completed or discharged, or when any division of interest other than that set forth above shall , for any reason, become effective and to furnish transfer order accordingly and that in the event such notice shall not be received, KPK shall be held harmless in the event of , and are hereby released from any and all damage or loss which might arise out of overpayment . Should adjustments be necessary, KPK shall have rights (but no duty) to set off any and all individual or joint liabilities the undersigned has with the same, including but not limited to proceeds from this and other lease interests owned by the undersigned. EIGHTH : If any portion of the proceeds derived from the sale of Gas is subject to refund under any order, rule or regulation of the Federal Energy Regulatory Commission or the provisions of the Natural Gas Act or Natural Gas Policy Act of 1978 , KPK may hold without interest the portion of the proceeds subject to refund unless indemnity satisfactory to KPK has been furnished, or until KPK' s refund obligation has been finally determined. If any portion of the proceeds derived from the sale of Gas is paid over by KPK under any order, rule or regulation of the Federal Energy Regulatory Commission or the provisions of the Natural Gas Act or Natural Gas Policy Act of 1978 , KPK is authorized to recover the amount of the refund applicable to the interest of each of the undersigned from future payments (Oil and Gas) or at KPK' s election, it may invoice the undersigned therefor, plus the legal rate of interest KPK is or may be required to pay in connection with undersigned' s portion of the refund. NINTH : If the undersigned is a working interest owner and/or operator, he or she guarantees and warrants that all Gas and Oil tendered hereunder has been or will be produced and delivered in compliance with all applicable federal , state and local laws, orders , rules and regulations . TENTH: This Division Order shall become valid and binding upon each and every owner above named upon execution hereof by such owner regardless of whether or not any of the other above-named owners have so signed. No termination of this Division Order shall be effective without giving thirty (30) days prior written notice . If the provisions of this Division Order are in conflict with the provisions of any oil and gas lease covering the above-described property (ies) , the provisions of this Division Order shall prevail . Each undersigned owner ratifies and confirms his oil and gas lease as being in full force and effect as of the date hereof . In consideration of the purchase of Oil and Gas hereunder, consent is given KPK and any pipeline company which same may cause to connect with the wells and tanks on said land, to disconnect and remove such pipelines , in case of termination by either KPK or the undersigned of any purchases under this Division Order . In the event of conflict between the provisions of this Division Order and applicable law or regulations , the provisions of this Division Order shall be deemed modified so as to comply with such law or regulation. 2418s30 P-14- P-342 12/12/'44 04:411' PG 3 OF 4 - 3 - 941191 The undersigned expressly waive any claim against KPK for any and all amounts which may be due us from others for production prior to the effective date hereof . AJ Signatures of Owners Sign Below Taxpayer ID # Witnesses (Enter Mailing Address) Social Security # ATTEST (/ / A t 2 i ( Q fi 84-6000813 C 5.RK 0 0ARI) W. jI` WEBSTER, CHAIRMAN 12/07/94 BY: (1,4442, , WELD COUNTY BOARD OF COMMISSIONERS DEPUTY CLERK TO BO D Address P.O. BOX 758 GREELEY, CO 80632 2418830 B-1471 P-342 12/12/94 04:41P PG 4 OF 4 - 4 - 941191 K. P. KAUFFMAN COMPANY, INC. BANK WESTERN TOWER WORLD TRADE CENTER 1675 BROADWAY, SUITE 1970 DENVER,COLORADO 80202-4619 PETROLEUM MANAGEMENT TELEPHONE(303)825-4822 AND ACQUISITION5 FACSIMILE(303)825-4825 November 23, 1994 RE: Central Spindle Field Weld County, Colorado Dear Royalty Interest Owner: On October 1, 1994, K.P. Kauffman Company, Inc. ("KPK") successfully closed an agreement with Basin Exploration, Inc. ("Basin"), in which KPK acquired all of Basin's right, title and interest and became the operator of record in 103 wells of the Central Spindle Field, located in Weld County, Colorado. KPK further entered into a Ratification Agreement, dated October 1, 1994 with Associated Natural Gas, Inc. ("ANGI") for the gathering, processing and sale of Natural Gas and with Associated Transport & Trading Company ("ATTCO") for the transportation and sale of Crude Oil from the subject leases and wells. Under the Ratification Agreement, KPK and the royalty owners are subject to the original terms and conditions of the historical Gas Purchase and Processing Agreement on these properties governing the sale and marketing of natural gas and natural gas condensates. Crude oil will be sold under the same terms and conditions as historically achieved by Basin, which is presently at ATTCO's posted price plus $0.85 per barrel. KPK has obtained the highest market price available for sale of the natural gas and crude oil from the subject wells and/or batteries. As part of the ratification agreement, KPK entered into 100% division orders with ANGI and ATTCO, thereby assuming the responsibility for revenue distribution of oil and gas proceeds from the subject wells and/or batteries to the royalty owners. As a matter of corporate policy, KPK maintains separate fiduciary bank accounts for each well or battery that KPK operates. Accordingly, KPK has established a separate set of books and bank account for each well or battery in the Central Spindle Field. Proceeds from the sale of oil and gas from the 103 wells in the Central Spindle Field will be deposited by KPK into these separate accounts. KPK will audit the volume and amount of proceeds received from the sale 941191 K. P. KAUFFMAN COMPANY, INC. November 23, 1994 Page 2 of oil and gas, withhold and escrow, as required by Colorado State law, conservation, severance, and real property ad valorem taxes, and process and mail a combined oil and gas revenue distribution payment to each of the royalty owners in payment status on or before the 5th day of each month commencing December 1, 1994. KPK has completed reviewing title records including Division Order Title Opinions ("DOTO"), historical and current title information on the each of the subject properties and prepared new Division Orders for execution by each of the fractional interest owners. Enclosed please find two copies of the Division Order prepared pursuant to the DOTO's covering the well or battery. If you are in agreement with your interest as detailed on the Division Order, please sign the one copy of each Division Order, have your signature witnessed, and include your current mailing address and social security or federal identification number (revenues cannot be distributed without this information). Return the executed Division Order(s) to our office in the self addressed stamped envelope provided and retain one copy of each Division Order for your files. Upon receipt of the executed Division Order(s), any revenues now held in suspense will be unsuspended and disbursed during the next payment cycle, which is on or before the 5th of each month, commencing December 1, 1994, providing the accrued amount exceeds $25.00. Thereafter, revenue proceeds will be disbursed in the monthly payment cycle. If your monthly revenue proceeds are less than $25.00, they will be accrued until the amount reaches $25.00 or December of each year. In the event you do not agree with your interest as detailed on the Division Order, please provide KPK with documentation to support your opinion. After receipt and review of such information provided by you, KPK will notify you accordingly. As a matter of corporate background, KPK was originally formed on February 2, 1984, and incorporated in the State of California on June 5, 1984. On December 5, 1984, the corporation was granted a Certificate of Authority to operate in the State of Colorado and April 15, 1992 in the State of Wyoming. Kevin P. Kauffman is the sole shareholder of the corporation. The corporate headquarters is located at 1675 Broadway, Suite 1970, Denver, Colorado. KPK's corporate structure is comprised of five principal divisions; Exploration and Production, Crude Oil and Natural Gas Gathering, Water Hauling, Environmental Services, and Fiduciary Management. KPK is engaged in the business of exploring, developing, drilling, completing, acquiring and operating oil and gas wells and properties. 9411' t K. P. KAUFFMAN COMPANY, INC. November 23, 1994 Page 3 KPK owns and operates over 227 producing oil and gas and injector wells located in the Battleship Field and the Water Flood Unit in the North Park Basin-State of Colorado, the Johnstown, Hambert, Hudson, Wildhorse, Bombing Range, and Spindle Fields located in the Denver Julesberg Basin-State of Colorado, and the Mill-Gillette Field and Water Flood Unit located in the Powder River Basin-State of Wyoming. KPK operates and maintains each of its properties on a daily basis utilizing an internal staff of field personnel. KPK is deeply committed to maintaining the highest operational standards in the industry and to contributing in a positive manner to each community in which business is carried forth. It is our sincere pleasure to be of service to you. Should you have any questions regarding the foregoing, please contact Ronda Gallup, either by mail at the above address or by calling collect at (3 3) 825-4822. Very trul iaf: hi/c:.veofflc: Enclosures 941131. Hello