HomeMy WebLinkAbout950774.tiffAGREEMENT
(Oil, Gas and Associated Liquid Hydrocarbons)
THIS AGREEMENT is made and entered into this 13th day of April, 1993 among
UNION PACIFIC RESOURCES COMPANY ("UPRC") with an address for business of
P.O. Box 7, Fort Worth, Texas 76101, AMOCO PRODUCTION COMPANY ("Amoco")
with an address for business of P.O. Box 800, Denver, Colorado 80201, VESSELS OIL &
GAS COMPANY ("Vessels") with an address for business of Suite 2000 Prudential Plaza,
1050 Seventeenth Street, Denver, Colorado 80265 (all of which are hereinafter referred to
as the "Oil Companies") and GREEN MILL SPORTSMEN CLUB ("Club"), a Colorado
corporation, with an address for business of c/o Robert Engle, 2885 West 128th Avenue,
#1208, Denver, Colorado 80234.
RECITALS
A. Club has entered into a contract to purchase the surface estate for the N2SW„
Section 20, Township 1 North, Range 68 West, Weld County, Colorado, which is hereinafter
referred to as the "Property".
B. Club either has applied for or intends to apply for a use by special review to
have the Board of County Commissioners of Weld County approve the use of the Property
for a gun club with related facilities and structures.
C. A diagram of the facilities for the proposed gun club is attached to this
Agreement as Attachment 1.
D. Each of the Oil Companies has certain interests in the oil and gas estate that
underlies the Property, all as described in Recitals E and F.
E. UPRC or a sister company, Union Pacific Land Resources Corporation
("UPLRC"), is the owner of all of the mineral interests in the Property, including the oil and
gas estate. A portion of the mineral estate for the Property is subject to an oil and gas lease
which UPRC has granted to Amoco and which covers the NW,SW, and the S2NE,SW,.
F. Vessels has acquired an interest in the oil and gas estate for the Property
through UPRC in accordance with a Joint Operating Agreement dated July 14, 1980 ("JOA")
among Amoco, Vessels and Champlin Petroleum Company, predecessor in name to UPRC.
G. A gas well which has been completed in the J Sands formation is located in
the NW,SW, of the Property and is known as the Costigan E -Unit No. 1 well. Vessels
operates the well under the JOA.
H. Formations which are known to be productive in the area include the Dakota,
the J Sands, the Codell-Niobrara and the Sussex -Shannon.
I. Current Colorado Oil and Gas Conservation Commission ("Commission")
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Rules and Regulations would allow the owners of all of the oil and gas rights in the Property
to locate wells based on the spacing allowed by the Commission for the following formations:
Sussex -Shannon, Codell-Niobrara, J Sands, and Dakota.
J. This Agreement is contingent upon the Club securing all approvals that the
County or any other governmental entity might require to install a gun club on the Property
and the purchase by the Club of the surface estate.
K. The purpose of this Agreement is to locate drillsites for the development of
only the oil, gas and associated liquid hydrocarbons that underlie the Property; it does not
apply to the development or other disposition of the coal and minerals other than the oil,
gas and associated liquid hydrocarbons. The disposition of the minerals other than oil, gas
and associated liquid hydrocarbons is the subject of a separate agreement between UPLRC
and the Club.
NOW THEREFORE, in consideration of the covenants and the mutual promises set
forth herein, including those set forth in the Recitals, the parties agree as follows:
1. Drillsite Locations:
a. Future Locations: Each of the Oil Companies that has an interest in
a particular well that it could locate in either the center of a forty (40) acre parcel or in the
center of a one hundred sixty (160) acre parcel agrees to locate the drillsite for the
particular well at one of the two drillsite locations described on Attachment 1 as "Future
Drillsite'. Each drillsite location may be the location of one or more wells.
b. Existing Well: Each of the Oil Companies reserves all rights that it has
with regard to the existing well known as the Costigan E -Unit No. 1, including access and
all existing easements for pipelines. Each of the Oil Companies also agrees that if the
location of the Costigan E -Unit No.1 well is changed, such well shall be located on one of
the areas designated as a future drillsite on Attachment 1.
c. Drillsite Dimensions: The dimensions of the drillsite locations shall be
approximately 300' x 300' for the drillsite in approximately the E2N2SW, and 500' x 350' for
the one in the W2NZSW„ all as depicted on Attachment 1.
2. Access and Pipeline Easements: Access to drillsites and easements for
pipelines shall be at mutually acceptable locations which are convenient to the Oil
Companies. The Club shall keep any access which is jointly used by both the Oil Companies
and the Club in good condition and repair; provided, however, any Oil Company that
damages any access road agrees to promptly repair damages which it causes which is a direct
result of the use of the road by the Oil Company. Neither the Oil Companies on the one
hand nor the Club on the other shall unreasonably interfere with the use by the other party
of any access road.
The applicable Oil Company or Oil Companies and the Club may agree to
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change the access to the existing well; provided, however, the Club shall bear all expenses
to create a different access to the existing well and the Club shall in no event deny access
to existing or proposed wells by any Oil Company at any time during a transition from the
existing access to the new access.
Roads for access shall be approximately forty (40) feet in width during
construction and reduced to thirty (30) feet in width thereafter. Pipeline easements shall be
approximately forty (40) feet in width during operations to install and repair the pipelines
and reduced to twenty (20) feet in width after pipeline installation.
The Club shall be responsible at its sole expense to install and maintain any
gate to the entrance of its facilities which it desires; provided, however, any such gate shall
be a size which would allow for the passage of oil and gas drilling and completion rigs. The
Oil Companies will consult with the Club with respect to the width and design of any gate
to be installed. The Club shall allow the Oil Companies access through the gate at all times.
3. Operations: The parties intend to work collaboratively to assure the safe and
compatible operation of the gun club and oil and gas exploration and production. Toward
that end and subject to any emergency condition or other extraordinary well operations that
might occur or be required with respect to oil and gas operations (such emergency or
extraordinary well operations in all events taking precedence) the parties intend to conduct
their respective operations together as follows:
a. Emergency or extraordinary well operations include, but are not limited
to, well control problems such as blowouts, fishing jobs, leaking, formation stimulation,
fracing and recompletions.
b. The Club shall post a sign at its facility that gives notice to its members
and their invitees that oil and gas operations take place from time to time on the Property.
c. The Club shall install a sign at the gate which on one side reads "Gun
Club Operations on Premises" and on the other "Oil Field Operations/Gun Club Temporarily
Closed."
(1) In the event that an oil field employee comes onto the premises
first, he shall post the sign that reflects that the area is temporarily closed for oil field
operations and remove the sign when he leaves;
(2) In the event that a Club member comes onto the premises first,
he shall post the sign that reflects Gun Club operations and the sign shall be removed when
all members leave. Any oil field employee who comes onto the property thereafter shall
notify a designated Club member to cease Club operations while oil field operations take
place.
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d. Except in cases of emergency and extraordinary well operations, the Oil
Companies shall use best efforts to perform drill site service operations during week days
and not on weekends.
e. The Club shall include in its book of rules and regulations a rule that
Club members and their invitees are to temporarily cease shooting during the period of time
that the drillsites are being serviced after they have been informed by an oil field employee
that he desires to service a drillsite or drillsites.
f. At any time that an oil and gas operator desires to bring a drilling rig
or any type of maintenance or service rig onto the Property, the operator shall provide
notice to the Club at least fourteen days in advance in order to schedule such operations to
be as compatible as possible with the operations of the Club. In special circumstances, the
Club may request that the Oil Companies provide it with 21 days notice of such operations
and the Oil Companies shall use their best efforts to comply with the request.
g. Subject to emergencies and extraordinary well operations, the Oil
Companies shall perform no drilling or reworking operations for the period of time between
August 15 and November 15.
4. Fencing: In the event that the Club at any time elects to erect a fence or
fences around all or any part of the gun club facilities that encloses an oil and gas well or
drillsite location, the Club shall provide access to the Oil Companies for oil and gas
operations through the fence or fences.
5. Surface Damages: As consideration for the inconvenience to the Oil
Companies of giving up the right to drill a well in locations selected by them and allowed
by the Commission, the Club waives any right it has to surface damages for each well to be
drilled in the future on the Property; provided, however, the waiver by the Club is subject
to paragraph 2 and applies only to the area that is included in the two drillsite locations
designated as such on Attachment 1 and any rights -of -way related to oil and gas operations.
6. Surface Owner's Consent: The Club shall not withhold surface owner's
consent to the exercise by any Oil Company of its rights to the oil and gas estate. The Club
shall provide to an Oil Company all approvals as a surface owner that are required to drill
a well because of any law or rule or regulation, including any local ordinance and those of
the Colorado Oil and Gas Conservation Commission; provided, however, nothing herein
shall be deemed to require the Club to grant surface owner's consent or provide surface
owner's approval for the drilling of any well beyond the limits of the areas designated as
future drill sites on Attachment 1 and such access and easements for pipelines to which the
parties mutually agree.
7. Notice of Proceedings: In the event and at the time that the Club wishes to
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annex the Property to any municipality, the Club shall give thirty days advance written notice
to the Oil Companies, and the parties shall negotiate in good faith with regard to any
compensation which the Club would pay the Oil Companies because of the effect that such
an annexation might have on oil and gas operations; provided, however, the provisions of
this paragraph shall not apply if the Property is forcibly annexed to a municipality without
the Club petitioning for such annexation.
8. Indemnities: Each of the Oil Companies on the one hand and the Club on
the other hand shall defend, indemnify and hold harmless the other from any and all liability,
loss, damages, claims, demands, causes of action, levies, judgments and costs and expenses,
(including reasonable attorney's fees) for injuries to persons and damages to property which
is caused by its own negligence or willful misconduct or for claims for which it is strictly
liable and which arise from its respective operations on the Property.
9. Successors and Assigns: This Agreement and all of the terms included in it
shall be binding upon the successors and assigns of all of the parties and the benefits of this
Agreement shall inure to their successors and assigns.
10. Covenants Run With the Land: This Agreement and all of the covenants in
it shall be covenants running with the land and shall be binding on all parties who succeed
to any interest which any of the parties has in the Property.
11. Individual Liability of Oil Companies: The liability of each of the Oil
Companies to perform any obligation pursuant to this Agreement shall be several and
individual only and not joint and collective, including but not limited to the indemnities in
paragraph 8.
12. Termination: This Agreement shall terminate at the earlier event either that
1) the Club does not diligently pursue a use by special review with the County; or 2) the
County does not grant the Club a use by special review within 4 months from the date of
this Agreement; provided, however, that in the event that the Club at the end of four
months is continuing to diligently pursue both approval for a special use permit and the
financing referred to in the Agreement of Sale between the Club and Union Pacific Land
Resources Corporation ("UPLRC") dated April 12, 1993, the parties, in the event that
UPLRC agrees to an extension with respect to the surface estate, shall extend the term of
the Agreement for another four months.
13. Recording: Any party may record this Agreement with the Clerk and
Recorder of Weld County at any time after it is executed by all of the parties.
14. Assignment: The Club shall not assign this Agreement without the prior
written consent of the Oil Companies, which consent shall not be unreasonably withheld.
15. Incorporation of Attachment: Attachment 1 is incorporated into this
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Agreement by this reference.
16. Governing Law: This Agreement shall be construed according to the laws of
the State of Colorado, regardless of any conflict of law provisions which may apply. Any and
all actions at law or in equity which may be brought by any of the parties to enforce or
interpret this Agreement shall be brought only in the District Court in Weld County,
Colorado.
17. Severability: In the event that any provision of this Agreement is determined
by a court to be invalid, the remainder of this Agreement shall not be affected thereby and
shall remain in force.
18. Legal Fees: If any legal action or other proceeding is brought for the
enforcement of this Agreement or because of an alleged dispute, misrepresentation or
breach in connection with any of the provisions of this Agreement, the successful or
prevailing party shall be entitled to recover reasonable attorney's fees and other costs
incurred in the action or proceeding, in addition to any other relief to which it may be
entitled.
19. Paragraph Headings: The headings of paragraphs in this Agreement are for
convenience of reference only and are not to be considered a part of it. They shall not limit
or otherwise affect any of the terms included herein.
20. Modification of the Agreement: Neither this Agreement nor any provisions
in it may be changed, waived, discharged or terminated orally, but only by instrument in
writing signed by the party against which enforcement of the change, waiver, discharge or
termination is sought.
21. Rules of Construction: The judicial rules of construction (i) requiring or
allowing an instrument to be construed to the detriment of or against the interests of the
maker thereof; and (ii) requiring or allowing an indemnification provision to be construed
to the detriment or against the interests of the party being indemnified shall not apply to this
Agreement.
22. Notices: Any notice or communication required or permitted by this
Agreement shall be given in writing either by (a) personal delivery; (b) expedited delivery
service with proof of delivery; (c) United States Mail, postage prepaid, or registered or
certified mail with return receipt requested; or (d) prepaid telecopy or fax, the receipt of
which shall be acknowledged, addressed as follows:
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TO UPRC:
WITH A COPY TO:
TO AMOCO:
TO VESSELS:
TO THE CLUB:
WITH A COPY TO:
Ann Brady
Union Pacific Resources Company
801 Cherry Street, MS 1100
P.O. Box 7
Fort Worth, Texas 76102
Molly Sommerville, Esq.
Burns, Figa & Will, P.C.
One DTC Building
5251 DTC Parkway, Penthouse Three
Englewood, Colorado 80111
David Brody, Esq.
Amoco Production Company
1670 Broadway, Suite 984
P.O. Box 800
Denver, Colorado 80201
Andy Boden
Vessels Oil & Gas Company
Prudential Plaza
1050 Seventeenth Street, Suite 2000
Denver, Colorado 80265
Robert Engle
2885 West 128th Avenue, #1208
Denver, Colorado 80234
David Pehr, Esq.
8787 Turnpike Drive, #280
Westminster, Colorado 80030
Or to such other addresses or to the attention of such other persons as a party may
designate in writing. Notice shall be deemed to have been given either at the time of
personal delivery or, in the case of delivery service, mail or telefax, at the date of receipt.
23. Counterpart Execution: This Agreement may be executed in counterparts,
each of which shall be deemed to be an original.
24. Entire Agreement: This Agreement sets forth the entire understanding among
the parties and supersedes any previous communications, representations or agreements,
whether oral or written. No change of any of the terms or conditions herein shall be valid
or binding on any party unless in writing and signed by an authorized representative of each
party.
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IN WITNESS WHEREOF, the undersigned parties have executed this Agreement
as designated on their respective signature pages. Each party and the individual executing
this Agreement represents and warrants that the individual executing this Agreement has
been duly authorized to enter into this Agreement and to bind the party on behalf of which
such individual is executing.
UNION PACIFIC RESOURCES COMPANY
By:
Date: Title:
AMOCO PRODUCTION COMPANY
By:
Date:. Title:
VESSELS OIL & GAS COMPANY
By:
Date: Title:
GREEN MILL SPORTSMEN CLUB
By:
Date: Title:
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STATE OF TEXAS
COUNTY OF TARRANT
) ss.
The foregoing Agreement was acknowledged before me this _ day of
1993, by as of
UNION PACIFIC RESOURCES COMPANY.
[SEAL]
Witness my hand and official seal.
Address:
My Commission Expires:
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
Notary
The foregoing Agreement was acknowledged before me this _ day of
, 1993, by as of
AMOCO PRODUCTION COMPANY.
[SEAL]
Witness my hand and official seal.
Address:
My Commission Expires:
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Notary
950774
STATE OF COLORADO )
) ss.
CITY AND COUNTY OF DENVER )
The foregoing Agreement was acknowledged before me this _ day of
1993, by as of
VESSELS OIL & GAS COMPANY.
Witness my hand and official seal.
Notary
[SEAL]
Address:
My Commission Expires:
STATE OF COLORADO
) ss.
COUNTY OF
The foregoing Agreement was acknowledged before me this _ day of
, 1993, by as of
GREEN MILL SPORTSMEN CLUB.
Witness my hand and official seal.
Notary
[SEAL]
Address:
My Commission Expires:
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