Ord. 0568 07-10-89ORDINANCE NO. 568
AN ORDINANCE AUTHORIZING THE EXECUTION OF AN AGREEMENT,
A FACSIMILE OF SAME BEING ANNEXED HERETO, INCORPORATED
HEREIN FOR ALL PURPOSES DESIGNATED EXHIBIT "A" BY AND
BETWEEN SANTA FE ENERGY COMPANY AND THE CITY OF
PEARLAND, TEXAS.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PEARLAND:
SECTION 1. That the facsimile of agreement, annexed hereto,
incorporated herein for all purposes, designated Exhibit "A", by and
between Santa Fe Energy Company and the City of Pearland, Texas, for
an Oil, Gas and Mineral Lease on property owned by the City of
Pearland is hereby authorized and approved.
SECTION -2. The City Council finds that such agreement is
reasonable.
SECTION 3. The Mayor and the City Secretary of the City of
Pearland, Texas, are hereby authorized and directed to execute for and
on behalf of the City the annexed agreement documents, and counter-
parts thereof.
PASSED and APPROVED on FIRST READING this the
9-)d
ATTEST:
City Secretary
, A. D., 1989.
ayor
day of
1
PASSED and APPROVED on SECOND and FINAL READING this the
/12 day of , A. D., 1989.
ATTEST:
City S cretary
APPROVED AS TO FORM:
ity Attorney
2
EXHIBIT "A"
**
• Producers 88 (7.69)—Paid Up
With 640 Acres Pooling Provision
POUND PRINTING & STATIONERY COMPANY
89702 9 7 0 424 2 2325 FANNIN, HOUSTON, TEXAS 7NO2, M3)659-3159
22261 OIL, GAS ANDMINERAL LEASE qq
THIS AGREEMENT made this 13th 'Aril ..1l9 between
_ The City of Pearland2_a Municipal Corporation
0 Box 2068 Pearland Texas 77588
lessor (whether one or more), whose address ie:.._:..__'_.,,,, 1 ,
_ __.... _.___.._._.—..__........_in
,pd anta.._Fe_EnergyComDany,1616 S.VosszSt^400,Houston2Texas 77057-2698
lessee. WITN IIaz, receipt
I. Lessor. in consideration of....
Ten and other valuable considerations
of which is hereby acknowledged, and of the covenants and agreements of lessee hereinafter contained, does hereby grant, lease and let unto lessee
the land covered hereby for the .�crur s and�w�ith th the right of exploring, drilling, mining and operatingfor, producing and owning oil, gas,
' NA`ME Kam`• X13GX�Fxi>7G i �XrdE3f(l61 L together with the right to make surveyon said land, lay DiDe lines,
establish and utilize facilities for surface or subsurface disposal of salt water, construct roads and bridges, dig canals, build tanks, power stations,
telephone lines. employee houses and other structures on•said land. necessary or useful in lessee's operations in exploring, drilling for, producing,
treating, storing and transporting minerals produced from the land covered hereby or any other land adjacent thereto. The land covered hereby,
herein called "said land", 1, located in the County of Brazoria State of Texas and is described as follows:
20.0 acres of land, more or less, being all of Lots 60 and 76 of Division L
of the E. Little Survey, A-320, Brazoria County, Texas and being the same
land described in an Oil, Gas and Mineral Lease dated May 19, 1977 from
The City of Pearland to Lenoir Josey, Inc., and recorded in Volume 1346, Page
9 of the Deed Records of Brazoria County, Texas.
This lease also covers and includes, in addition to that above described, all land. ;f any, contiguous or adjacent to or adjoining the land above
described and (a) owned or claimed by lessor by limitation, prescription. possession. reversion or unrecorded instrument or (b) as to which lessor
has a preference right of acquisition. Lessor agrees to execute any supplemental instrument requested by lessee for a more complete or accurate
description of said land. For the purpose of determining the amount of any bonus or other payment hereunder. said land shall be deemed to contain
20. 0 acres, whether actually containing more or less, and the above recital of acreage in any tract shall be deemed to be the true
acreage thereof. Lessor accents the bonus as lump sum consideration for this lease and all rights and options hereunder.
(3) three
2. Unless sooner terminated or longer kept in force under other provisions hereof, this lease shall remain in force for a term of g) years
from the date hereof, hereinafter called "primary term", and as long thereafter as operations, as hereinafter defined, are conducted uponpen said land
with no cessation for more than ninety (90) consecutive days.
1/5 3 As royalty. lessee covenants and agrees: (a) To deliver to the coedit of lessor, in the pipe line to which lessee may connect its wells, the
equal enstiweh part of all oil produced and saved by lessee from said land, or from time to time, at the option of lessee. to pay lessor the
average posted market price or such aswelt part of such oil at the wells as of the day it is run to the 1{5 in either case, to bearpipe ns orgasstorage tanks, s, casinghead
iaa pro -
a) tenon
t the cost of treating oil to render it marketabled pipe line o; d the
pay mouth
lessor on gas and ea 2) whened used pro-
1/5 emcee from said land i wsen sold manutacture lessee g�:� of the amounts, the
by lessee. .tthe
at coon h of the well. ie (2) be
ressre oft boasaid land or m o paygesson110other gasoline or othermiproducts, eke market ililed, by lean a mouth a the welh of enth eithe of such gas 1/5
1�5 and casinghead gas: (c) Tt s lessor on al minerals mined and marketed or utilized royalty lessee from said Iona, one -tenth either in kind or
value pt ate web mane Tat tare's election, exceptmethat on thereafter,rhur tee and anyyrkell the shall be one dollar' (61.00) hsaidper long ton. If, at
the expiration has been othe primary capable term pr dt ing Limo or t, ellsre le -in. on sale land oral , n lands wets which Inaf rc aas poough
operso[ nsa ei g c ed of produlandcing oil or gas, and all wellsen wren are aaid thereafter this leasetleaseshall, n may beelcos continuein in forceino
though
operations were being versant and said for so long as saidilleare shut-in,ce.and omathis mcontinuedcapableofforce u if from u saidid
had occurred. Lessee covenants suchhd agrees to use reasonable no be
lig to produce, ll or r market the minerals well of beingle produced
wells but in the exercise, separator.oa d le se tank. andll not be obregd re i to sll tle labor olitior other that well fpoitier and unacceptableccepats
faaee. 1a at
Dow lines, ooand lease ratiok. and wall not be rm. requiredto settle labor troubleor to market gas upon terms s,and
to .
lessee I time there any time or times after the expiration tion of the primary beforethe term. all such wells are shut-in for a periodlessee of ll pay orconsecutive.y ch and during
ovchare no sum equal on said dollar
then at foror
of landdiot of sold eel he day period. esseeshshall pay or tenent, or check or draft
of lesseee. as dre, h anniversaryveto one ere p ($ion) ford •ni acre day then covered hereby. anniversaryLarthis ilease isse like continuedtnforceeess at y
before
the end of each f hipa g the expiration of said •ninety period if upon such the ies who being met solely by reason of the provisions of this paragraph. Each such payment or tender shall be made to parties at the time of payment would be entitled to
receive the royalties which would be paid under this lease if the wells were producing, and may be deposited in the
—_.__—Bank
at or its successors. which shall continue as the depositories. regardless of changes in the own-
ership of shut-in royalty. If at any time that lessee pays or tenders shut-in royalty, two or more parties are, or claim to be, entitled to receive same,
lessee may, in lieu of any other method of payment herein provided. pay or tender such shut-in royalty, in the manner above specified. either jointly
to such patties or separately to each in accordance with their respective ownerships thereof. as lessee may elect. Any payment hereunder may be made
by check or draft of lessee deposited in the mail or delivered to the party entitled to receive payment or to a depository bank provided for above on or
before the last date for payment. Nothing herein shall impair lessee's right to release as provided in paragraph 6 hereof. In the event of assignment
of this lease in whole or in part. liability for payment hereunder shall rest exclusively on the then owner or owners of this lease, severally as to acreage
owned by each.
4. Lessee ;s hereby granted the right, at its option. to pool or unitize any land covered by this lease with any other land covered by this lease,
and/or with any other land, lease, or leases, as to any or all minerals or horizons, so as to establish units containing not more than es surface acres, 40
320 plus 10% acreage tolerance; provided however units may be established as to any one or more horizons. Or existing units may be enlarged as to any
one or more horizons, so as to contain not more than a surface acres plus 10% acreage tolerance, if limited to one or more of the following: (I)
gas, other than casinghead gas, (2) liquid hydrocarbons (condensate) which are not liquids in the subsurface reservoir, (3) minerals produced from
wells classified as gas wells by the conservation agency having jurisdiction. If larger units than any of those herein permitted, either at the time
established. or after enlargement, are required under any governmental rule or order, for the drilling or operation of a well at a regular location.
or for obtaining maximum allowable from any well to be drilled. drilling. or already drilled, any such unit may be established or enlarged
to conform to the size required by such governmental order or rule. Lessee shall exercise said option as to each desired unit by executing an instru-
ment identifying such unit and filing it for record in the public office in which this lease ;s recorded. Each of said options may be exercised by
lessee at any time and from time to time while this lease is in force. and whether before or after production has been established either on said
land, or on the portion of said land included in the unit. or on other land unitized therewith. A unit established hereunder shall be valid and effec-
tive for all purposes of this lease even though there may be mineral, royalty. or leasehold interests in lands within the unit which are not effectively
pooled or unitized. Any operations conducted on any part of such unitized land shall be considered, for all Purposes, except the payment of royalty.
operations conducted upon said land under this lease. There shall be allocated to the land covered by this lease within each such unit (or to each
separate tract within the unit if this lease covers separate tracts within the unit) that proportion of the total production of unitized minerals from
the unit, after deducting any used in lease or unit operations. which the number of surface acres in such land (or in each such separate tract) cov-
ered by this lease within the unit bears to the total number of•surface acres in the unit, and the production so allocated shall be considered for all
purposes. including payment or delivery of royalty, overriding royalty and any other Payments out of production, to be the entire production of
unitized minerals from the land to which allocated in the same manner as though produced therefrom under the terms of this lease. The owner of the
reversionary estate of any term royalty or mineral estate agrees that the accrual of royalties pursuant to this paragraph or of shut-in royalties from
a well on the unit shall satisfy any limitation of term requiring production of oil or gas. The formation of any unit hereunder which includes land not
covered by this lease shall not have the effect of exchanging or transferring any interest under this lease (including, without limitation, any shut-
in royalty which may become payable under this lease) between parties owning interests in land covered by this lease and parties owning Interests In
land not covered by this lease. Neither shall it impair the right of lessee to release as provided in paragraph 6 hereof, except that lessee may not so
release as to lands within a unit while there are operations thereon for unitized minerals unless all pooled leases are released as to lands within the
unit. At any time while this lease ;s in force lessee may dissolve any unit established hereunder by filing for record In the public office where this lease
is recorded a declaration to that effect. if at that time no operations are being conducted thereon for unitized minerals. Subject to the provisions of
this paragraph 4. a unit once established hereunder shall remain in force so long as any lease subject thereto shall remain in force. If this lease now
or hereafter covers separate tracts. no pooling or unitization of royalty interests as between any such separate tracts is intended or shall be implied
or result merely from the inclusion of such separate tracts within this lease but lessee shall nevertheless have the right to pool or unitize as provided
in this paragraph 4 with consequent allocation of production as herein provided, As used In this Paragraph 4. the words "separate tract" mean any
traet with royalty ownership differing. now or hereafter, either ae to parties or amounts, from that as to any other part of the leased premises.
6, Lessee may at any time and from time to time execute and deliver to lessor or file for record a release or releases of this lease as to any part or
all of said land or of any mineral or horizon thereunder. and thereby be relieved of all obligations as to the released acreage or Interest.
6. Whenever used in this lease the word "operations" shall mean operations for and any of the following: drilling, testing. completing, reworking,
recompleting. deepening, plugging back or repairing of a well in search for or In an endeavor to obtain production of oil, gas, sulphur or other min-
erals, excavating a mine, production of oil, gas, sulphur or other mineral. whether or not in paying quantities.
1. Lessee shall have the use, free from royalty, of water. other than from lessor's water wells, and of oil and gas produced from said land in
all operstlons hereunder. Lessee shall have the right at any time to remove all machinery and fixtures placed on said land. Including the right to
draw and remove casing. No well shall be drilled nearer than 200 feet to the house or barn now on said land without the consent of the lessor. Leann shall pay for damages caused by its operatlona to growing crops and timber on said land.
and minerals associated with oil and gas,
**
897.02 425
8. The rights, and estate of any party hereto may be assigned from time to time in whole or in part and as to any mineral or horizon. AB of
the covenants. obligations, and considerations of this lease shall extend to and be binding upon the parties hereto, their heirs. successors. assigns.
and successive assigns. No change or division in the ownership of said land. royalties, or other moneys. or any part thereof. howsoever effected, shall
increase the obligations or diminish the rights of lessee. including, but not limited to, the location and drilling of wells and the measurement of pro-
duction. Notwithstanding any other actual or constructive knowledge or notice thereof of or to lessee. its successors or assigns, no change or division
in the ownership of said land or of the royalties, or other moneys, or the right to receive the seine, howsoever effected. shall be binding upon the then
record owner of this lease until thirty (30) days after there has been furnished to such record owner at his or its principal place of business by
lessor or lessor's heirs. successors. or assigns, notice of such change or division, supported by either originals or duly certified copies of the Instruments
which have been properly filed for record and which evidence such change or division. and of such court records and proceedings, transcripts. or other
documents as shall be necessary in the opinion of such record owner to establish the validity of such change or division. If any such change in owner-
ship occurs by reason of the death of the owner. lessee may. nevertheless pay or tender such royalties. or other moneys. or part thereof. to the credit
of the decedent in a depository bank provided for above.
9. In the event lessor considers that lessee has not complied with all its obligations hereunder. both express and implied. lessor shall notify
lessee in writing, setting out specifically in what respects lessee has breached this contract. Lessee shall then have sixty (60) days after receipt of
said notice within which to meet or commence to meet all or any Dart of the breaches alleged by lessor. The service of said notice shall be precedent
to the bringing of any action by lessor on said lease for any cause, and no such action shall be brought until the lapse of sixty (60) days after ser-
vice of such notice on lessee. Neither the service of said notice nor the doing of any acts by lessee aimed to meet all or any of the alleged breaches
shall be deemed an admission or presumption that lessee has failed to perform all its obligations hereunder. If this lease la cancelled for any cause.
it shall nevertheless remain in force and effect as to (1) sufficient acreage around each well as to which there are operations to constitute a drilling
or maximum allowable unit under applicable governmental regulatons, (but in no event less than forty acres), such acreage to be designated by
lessee as nearly as practicable in the form of a square centered at the well. or in such shape as then existing spacing rules require: and (2) any
part of said land included in a pooled unit on which there are operations. Lessee shall also have such easements on said land as are necessary to
operations on the acreage so retained.
10. Lessor hereby warrants and agrees to defend title to said land against the claims of all persons whomsoever. Lessor's rights and interests
hereunder shall be charged primarily with any mortgages, taxes or other liens. or interest and other charges on said land. but lessor agree that lessee
shall have the right at any time to pay or reduce same for lessor, either before or after maturity, and be subrogated to the rights of the holder thereof
and to deduct amounts so paid from royalties or other payments payable or which may become payable to lessor and/or assigns under this lease. If
this lease covers a less interest in the oil, gas. sulphur, or other minerals in all or any part of said land than the entire and undivided fee simple
estate (whether lessor's interest is herein specified or not). or no interest therein. then the royalties and other moneys accruing from any part as
to which this lease covers less than such full interest. shall be paid only in the proportion which the interest therein. if any, covered by this lease.
bean to the whole and undivided fee simple estate therein. All royalty interest covered by this lease (whether or not owned by lessor) shall be paid out
of the royalty herein provided. This lease shall be binding upon each party who executes it without regard to whether it is executed by all those
named herein as lessor.
11. If, while this lease is in force, at. or after the expiration of the primary term hereof, it is not being continued in force by reason of the
shut-in well provisions of paragraph 3 hereof. and lessee is not conducting operations on said land by reason of (1) any law, order, rule or regu-
lation, (whether or not subsequently determined to be invalid) or (2) any other cause. whether similar or dissimilar,. (except financial) beyond the
reasonable control of lessee. the primary term hereof shall be extended until the first anniversary date hereof occurring ninety (90) or more days
following the removal of such delaying cause, and this lease may he extended thereafter by operations as if such delay had not occurred.
•
12. Notwithstanding anything herein contained to the contrary, the Lessee agrees
that if any portion of the land covered by this lease is to be placed in a unit,
then all of the above described acreage will be included in such unit.
13. Notwithstanding any other provisions herein contained to the contrary, neither
lessee, nor its assigns shall have to right to use any part of the surface of the
aforedescribed lands for exploring for, drilling for, operating for or producing
any oil, gas or other minerals from the said land, nor shall they have the right
to place or erect upon said land any structure of any kind, and all development
and production shall be from wellheads located off of the surface of the herein
described and leased land.
14. Lessor hereby agrees not to enter this 20 acre tract or parcel of land for any
purpose.
Wigned for identification
coven unaer my band and seal of oifice ter Say of
My Commission Expires
STATE OF
COUNTY OF
Before me, the undersigned authority, on this day personally appeared
and husband and wife. known to me to be the persons whose names are
subscribed to the foregoing instrument. and acknowledged to me that they executed the same as their fres act and deed for the purpose and
consideration therein expressed. 19
Given under my hand and seal of office this day of
My Commission Expires
, l9
Notary Public in and for to Stale of Tern
Notary Printed Name
0
HUSBAND AND WIFE ACICNOWLEDGMENT—TEXAS OR NEW MEx1CO
Notary Public in and for the Stan of Tess
rk of the County Court N”nel .....,
ivy toot this lndnnMnt won
'uses and ae of IhtO°FICA.:.&.a
cw hereon by n
FFit.ED
AUG 14
tou
sAeznAg
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gf�e1 ;y"
Ceupw Clax of 'r t:n. Ct.�'.
R RECORD
07 A!i '89
i
tfiest
^l:v
This instrument was filed for
s
q
a
Notary's Pdmd Nunn
econds of this office.
A 0
89702 426
.
IN WITNESS WHEREOF, this instrumentt is executed onn the date first above written.
THE CITY OF PEARND BY:
„0 — MAYOR
STATE OF
COUNTY OF Brazoria
Before me. the undersigned authority, on this day personally appeared
Texas
Tax ID# 74-6028909
INDIVIDUAL ACKNOWLEDGMENT —TEXAS OR NEW MEXICO
Tom Reid
known to me to be the person_wbose name. --is (are) subscribed to the foregoing instrument, and acknowledged to me the. Tom Reid
—
Ole same se Ir't♦ act and deed for the purposesandand consideration therein expressed.
tit �rvMbWder{}esood vmien-pi o£f a thry day of 1
,uI^WlfeN 9 OIRES
tolgla,la. SA.
STATE OF
COUNTY OF
Before me, the undersigned authority. on this day personally appeared
Zt-
Notary Public -. .for the Suaof ,q
Pa bVaugh
Notary's Ponied Name
22261
7.00 C-
.Gu 1.
rr
INDIVIDUAL ACKNOWLEDGMENT —TEXAS OR NEW MEXICO 7 •0:. D< T .
• 000 6162 01A 6/1A/6S
known to me to be the person_whose name —Is (are) subscribed to the foregoing instrument. and acknowledged to me tha'
executed the same as free act and deed for the purposes and consideration therein expressed.
Given under my band and seal of office thi. day of 19
My Commission Expires
STATE OF
COUNTY OF
Before me, the undersigned authority. on this day personally appeared
Notary Public in and for the Swe of Texas
Notary's Pooled Nam:
HUSBAND AND WIFE ACKNOWLEDGMENT —TEXAS OR NEW MEXICD
and husband and wife, known to me to be the persons whose names are
subscribed to the foregoing instrument. and acknowledged to me that they executed the same as their free act and deed for the purpoees and
consideration therein expressed.
Given under my band and seal of office this day of 19
My Commission Expires
N
CV
a
'b
Notary Public in and for the Sme of Texas
D rrk of the Coumy Coo, P r,<tr.: r :-
C nniPvtnm tnis inntrurrsnt we+fif. c: ! _
.-n VrAwresnd Fz of i,TQ°FIGA� cC:
3mood ntreon lit
Santa Fe Energy Company
1616 South Voss Road Suite 400
Houston, Texas 77057-2698
713/783-9561
TWX 910 881-2501
Telecopier 713/977-9775
August 23, 1989
The City of Pearland
P. 0. Box 2068
Pearland, Texas 77588
Re: 0i1, Gas and Mineral Lease dated
April 13, 1989 between The City of
Pearland, as Lessor and Santa Fe
Energy Company, as Lessee
Razor Prospect
Brazoria County, Texas
SFE Lease #22061
Gentlemen:
Pursuant to your request, enclosed is a recorded copy of the captioned
lease for your information and files.
Yours very truly,
Mary Be Peters
MBP/etp
Enclosure
A Santa Fe Southern Pacific Company