HomeMy WebLinkAbout12436 ORD - 01/22/19750 JRR:VMR:1- 21- 75;1ST
TEXAS.
AN ORDINANCE
AUTHORIZING AND DIRECTING THE CITY MANAGER TO EXECUTE
A LEASE AGREEMENT BETWEEN THE CITY OF CORPUS CHRISTI
AND PETER - SALPETER ENERGY COMPANY, INC., OF CORPUS
CHRISTI FOR THE PURPOSE OF INVESTIGATING, EXPLORING
PROSPECTING, DRILLING AND MINING FOR AND PRODUCING OIL
AND GAS BENEATH THE SURFACE OF THAT TRACT OR PARCEL
OF LAND DESCRIBED AS 65.5 ACRES OF LAND BEING THE SAME
LAND DESCRIBED IN A CERTAIN DEED DATED AUGUST 14, 1934;
FROM ARTHUR C. JONES TO THE CITY OF CORPUS CHRISTI,
RECORDED IN VOLUME 105, AT PAGES 153 -154 OF THE DEED
RECORDS OF SAN PATRICIO COUNTY, TEXAS, OWNED BY THE
CITY OF CORPUS CHRISTI, ADJACENT TO LAKE CORPUS CHRISTI,
AND BEING FOR A PRIMARY TERM OF NINETY (90) DAYS,
COMMENCING WITH THE DATE OF EXECUTION OF THE SAID OIL
AND GAS LEASE, A COPY OF WHICH IS ATTACHED HERETO AND
MADE A PART HEREOF; AND DECLARING AN EMERGENCY.
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI,
SECTION 1. THAT THE CITY MANAGER BE AND HE IS HEREBY AUTHORIZED
AND DIRECTED, FOR AND ON BEHALF OF THE CITY OF CORPUS CHRISTI, TO EXECUTE
AN OIL AND GAS LEASE BETWEEN THE CITY OF CORPUS CHRISTI, AS LESSOR, AND
PETER - SALPETER ENERGY COMPANY, INC., OF CORPUS CHRISTI, AS LESSEE, FOR
THE PURPOSE OF INVESTIGATING, EXPLORING, PROSPECTING, DRILLING, MINING
AND OPERATING FOR AND PRODUCING GAS AND GASEOUS SUBSTANCES BENEATH THE
SURFACE OF THAT TRACT OR PARCEL OF LAND DESCRIBED AS FOLLOWS:
65.5 ACRES OF LAND BEING THE 1 SAME LAND DESCRIBED IN A
CERTAIN DEED DATED AUGUST 14, 1934, FROM ARTHUR C. JONES
TO THE CITY OF CORPUS CHRISTI, TEXAS, RECORDED IN VOL.
105, AT PAGES 153 -154, OF THE DEED RECORDS OF SAN PATRICIO
COUNTY, TEXAS,
SAID LEASE BEING FOR A PRIMARY TERM OF NINETY (90) DAYS, ON THE BASIS OF
A CASH BONUS OF $20.65 PER ACRE AND THE ROYALTY OF 3/16, COMMENCING WITH
THE DATE OF EXECUTION OF THE SAID OIL AND GAS LEASE, ALL AS MORE FULLY SET
FORTH IN THE LEASE, A COPY OF WHICH IS ATTACHED HERETO AND MADE A PART
HEREOF, MARKED EXHIBIT "A ".
SECTION 2. THE NECESSITY TO AUTHORIZE THE EXECUTION OF THE
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AFORESAID OIL AND GAS LEASE IN ORDER THAT PROPOSED OPERATIONS ON THE PARCEL
OR TRACT OF LAND DESCRIBED HEREINABOVE MAY BE COMMENCED WITHOUT DELAY CREATES
A PUBLIC EMERGENCY AND AN IMPERATIVE PUBLIC NECESSITY REQUIRING THE SUSPENSION
OF THE CHARTER RULE THAT NO ORDINANCE OR RESOLUTION SHALL EE PASSED FINALLY
ON THE DATE OF ITS INTRODUCTION BUT THAT SUCH ORDINANCE OR RESOLUTION SHALL
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BE READ AT THREE SEVERAL MEETINGS OF THE CITY COUNCIL, AND THE MAYOR
HAVING DECLARED SUCH EMERGENCY AND NECESSITY TO EXIST, AND HAVING
REQUESTED THE SUSPENSION OF THE CHARTER RULE AND THAT THIS ORDINANCE
TAKE EFFECT AND BE IN FULL FORCE AND EFFECT FROM AND AFTER ITS PASSAGE,
IT IS ACCORDINGLY SO ORDAINED, THIS THE
DaY of JANUARY, 1975•
ATTEST:
CITY SECRETARY
AP5gWED:
aO' DAY OF JANUARY, 197.5
ltql�-OQI�Aal
EXEC., ASST., CITY ATTORNEY
MAYOR
THE CITY OF CORPUS CHRISTI, T AS
OIL AND GAS LEASE
THE STATE OF TEXAS X
COUNTY OF NUECES X
DESCRIPTION: 65.5 acres of land being the same land described
in a certain Deed dated August 14, 1934, from Arthur C. Jones
to the City of Corpus Christi, Texas, recorded in Volume 105,
at pages 153 -154, of the Deed Records of San Patricio County,
Texas.
THIS AGREEMENT made this day of , 1975, between the
CITY OF CORPUS CHRISTI, TEXAS, Lessor, and Peter - Salpeter Energy Company_
Inc. Lessee,
W I T N E S S E T H
1. Lessor, in consideration of One Thousand Three Hundred Fifty
Two and 58/100 Dollars ($_1,352.58 ) (There shall be a
Cash Bonus Minimum of Twelve and 501100 Dollars ($12.50) per acre for a 90 -day
duration primary term,
from this date) in cash in hand paid and
other good and valuable consideration of the royalties herein provided, and the
agreements of Lessee herein contained, hereby GRANT, LEASES and LETS exclusively
unto Lessee the above described land for the purpose of investigating, exploring,
prospecting, drilling and mining for and producing oil and gas, subject to the
limitations contained herein.
2. Subject to other provisions, this lease shall expire at the termina-
tion of the primary term unless (a) drilling operations and subsequent oil and /or
gag production has commenced on this lease or (b) provided for in paragraph 4
hereunder. Drilling operations meaning the actual drilling into the surface and /or
in this case actual reentry operations into a formerly plugged and abandoned well.
3. The royalties to be paid Lessor aie (a) on oil, or oil well gas from
a well defined by Texas Railroad Commission as an oil well, no less than three -
sixteenths of eight - eighths (3 /16th of 8 /8ths) of that produced and saved from said
land, the same to be delivered at the wells or to the credit of Lessor into the
pipeline to which the wells may be connected; (b) on gas, oil, or other substance
from a well defined by the Texas Railroad Commission as a gas well, produced from
said land and sold or used off the premises, the market value at the well of no
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less than three - sixteenths of eight - eighths (3 /16ths of 8 /8ths) of the gas or oil
so sold or used. Lessor reserves the right, at his option, for any well with a
surface or bottom hole locgtion on herein described lease, to at any time take
his three - sixteenths (3 /16ths) of the gas well gas, and associated liquids, in
kind, all delivered at the wellhead. Lessor further reserves the right, at his
option, to take the remaining thirteen - sixteenths (13 /16ths) of the gas well gas,
and associated liquids at the wellhead, all at the competitive price for other
gas well gas produced and sold in the area, but the price of this gas not to
exceed $1.50 per mcf. Lessee shall have free use of oil and gas from said land,
for all operations hereunder, and the royalty on oil and gas shall be computed
after deducting any so used. Lessor is exempt as a matter of law from any and
all State of Texas severance taxes on oil and gas, and no dedueLluns shall bc
made for severance taxes in royalty settlements.
4. Lessee is hereby given the right anu power to pool or combine the
land covered by this lease or any portion thereof for gas or oil with any other
land, lease or leases located adjacent to or continguous with, when in Lessee's
judgment it is necessary or advisable to do so in order to properly develop and
operate said premises, and upon notifying Lessor, provided that no unit for gas
so created shall exceed 320 acres plus a tolerance of ten percent (10 %) in area
and no unit for oil shall exceed 40 acres plus a tolerance of ten percent (107)
in area. If production is found on the pooled acreage, it shall be treated as
if production is had from this lease but only as to lands covered hereby and
included in any pooled unit or units. In lieu of the royalties elsewhere herein
specified, Lessor shall receive on production from a unit so pooled only such
portion of the royalty stipulated herein as the amount of his acreage placed in
the unit of his royalty interest therein bears to the total acreage so pooled
in the particular unit involved, but in no event less than One Hundred Dollars
($100.00) per year. That unitization of any part of the mineral lease with other
minerals will only serve to hold, beyond the primary term, that portion unitized,
and the portion that is not in the unit released back to the Lessor upon expiration
of the primary term.
5. That any surface use of lease herein described be agreed to by the
Lower Nueces River Water Supply District.
6. If prior to discovery of oil or gas on said land Lessee should drill
a dry hole or holes on lands pooled herewith or if after discovery of oil or gas
the production thereof should cease from any cause, this lease shall not terminate
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if Lessee commences additional drilling or reworking operations within sixty (60)
days thereafter. if at the expiration of the primary term, oil, gas or other
mineral is not being produced on lands pooled herewith but Lessee is then engaged
in drilling or reworking operations thereon, the lease shall remain in force sixty
(60) consecutive days, and if they result in the production of oil or gas so long
thereafter as oil or gas is produced from said land. In the event a well or wells
producing oil or gas in paying quantities should be brought in on adjacent land
not pooled with the lands covered by this lease and within 467 feet or or draining
the leased premises, Lessee agrees to drill such offset wells as a reasonable
prudent operator would drill under the same or similar circumstances; provided,
however, that should Lessee be unable to obtain a surface location on other lands
leased herein, then Lessee shall be excused from any and all liability or obliga-
tion to drill such offset well, provided that within thirty (30) days thereafter
lessee seeks and obtains the written permission from the owners of the surface of
the lands leased herein for the purpose of drilling and producing such well.
7. The right of either party hereunder may be assigned in whole or in
part and the provisions hereof shall extend to the heirs, successors and assigns,
but no change or divisions in ownership of the land or royalties, however
accomplished, shall operate to enlarge the obligations or diminish the rights of
Lessee. No sale or assignment by Lessor shall be binding on Lessee until Lessee
shall be furnished with a certified copy of recorded instrument evidencing same.
If six or more parties become entitled to royalty hereunder, Lessee may withhold
payment thereof unless and until furnished with a recordable instrument executed
by all such parties designating an agent to receive payment for all.
8. Lessor hereby warrants and agrees to defend the title to said land
and agrees that Lessee at its option may discharge any tax, mortgage or other lien
upon said land and in event Lessee does so, it shall be subrogated to such lien
with the right to enforce same and apply royalties accruing hereunder toward
satisfying same. Without impairment of Lessee's rights under the warranty in
event of failure of title, it is agreed that if Lessor owns an interest in said
land less than the entire fee simple estate, then the royalties to be paid Lessor
shall be reduced proportionately.
9. Should Lessee be prevented from complying with any express or implied
covenant of this lease, from conducting drilling or reworking operations thereon
or from producing oil or gas therefrom by reason of strike, by operation of force
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majeure or by any Federal or State law or any order, rule or regulation of
governmental authority, then w:.ile so prevented through no fault of Lessee, Lessee's
obligation to comply with such covenant shall be suspended, and Lessee shall not
be liable in damages for failure to comply therewith; and this lease shall be
extended while and so long as Lessee is prevented by any such cause from conduct-
ing drilling or reworking operations on or from producing oil or gas from the
leased premises and the time while Lessee is so prevented shall not be counted
against Lessee, anything in this lease to the contrary notwithstanding.
10. That all operations on the herein described lease surface comply
with the requirements of the City of Corpus Christi's Land Drilling Ordinance
#8879 with the exception of drilling block density and unitization provisions.
This will include the requirement that a permit be obtained and that tha bonding
and insurance provisions be complied with.
IN WITNESS WHEREOF, this instrument is executed in duplicate on the
date first above written.
ATTEST:
City Secretary
APPROVED AS TO LEGAL FORM:
day of , 1975
City Attorney
CITY OF CORPUS CHRISTI
By:
R. Marvin Townsend
City Manager LESSOR
PETER- SALPETER ENERGY COMPANY, INC.
Ry:@ -Y� o� ( AL2 — Q-1�
LESSEE
Ronald L. Chachere, Its duly authorized
agent
THE STATE OF TEXAS X SORRELL, ANDERSON & SORRELL
COUNTY OF NUECES X 600 Petroleum Tower
Corpus Christi, Texas 78401
BEFORE ME, the undersigned authority, on this day personally appeared
R. MARVIN TOWNSEND, City Manager of the City of Corpus Christi, Texas, known to
me to be the person whose name is subscribed to the foregoing instrument and
acknowledged to me that he executed the same for the purposes and consideration
therein expressed, and in the capacity therein stated and as the act and deed
of said City.
GIVEN UNDER MY NAND AND SEAL OF OFFICE, this the day of ,
1975.
Notary Public, Nueces County, Texas
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Corpus Christi,'Texas
g.g_ day of
TO THE MEMBERS OF THE CITY COUNCIL
Corpus Chriati, Texas
For the reasons set forth in the emergency clause of the foregoing
ordinance, a public emergency and imperative necessity exist for the suspen-
sion of the Charter rule or requirement that no ordinance or resolution shall
be passed finally on the date it is introduced, and that such ordinance or
resolution shall be read at three meetings of the City Council; I, therefore,
request that you suspend said Charter rule or requirement and pass this ordi-
nance finally on the date it is introduced, or at the present meeting of the
City Council.
Respectfully
i
MAYOR
THE CITY OF CORPUS CHRISTI, TEXAS
The Charter rule was suspended by the following vote:
Jason Luby
James T. Acuff
Rev. Harold T. Branch
Thomas V. Gonzales
Ricardo Gonzalez
Gabe Lozano, Sr.
J. Howard Stark
The above ordinance was passed by the following vote:
Jason Luby
aes T. Acuff
Rev. Harold T. Branch
Thomas.V. Gonzales
Ricardo Gonzalez
Gabe Lozano, Sr.
J. Howard Stark