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HomeMy WebLinkAbout04395 ORD - 11/18/1955A=: 10/5/55 AN ORD I idANCE AUTHORIZING AND DIRECTING THE CITY MANAGER FOR AND ON BEHALF OF THE CITY OF CORPUS CHRISTI TO ENTER INTO AN 01L AND GAS LEASE WITH MAPLE WILSON FOR THE LEASING ON A ONE— EIGHTH (1/6) ROYALTY AND CASH BONUS BASIS ON THOSE CERTAIN LANDS OPINED BY THE CITY OF CORPUS CHRISTI, NUECES COUNTY TE ?AS WHICH THE CITY OWNS ONLY AN UNDIVIDED ONE — HALF 1 2 MINERAL INTEREST, DESCRIBED AS LOTS 9 AND 10, SECTION 21 OF THE FLOUR BLUFF AND ENCINAL FARM AND GARDEN TRACTS, CONTAINING FORTY 0 ACRES OF LAND, IN ACCORDANCE 'JITH THE TEMOS AND CONDITIONS OF SAID LEASE, A COPY OF WHICH 13 ATTACHED HERETO AND MADE A PART HEREOF. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. THAT THE CITY NIANAG Et, BE AND HE IS HEREBY AUTHORIZED AND 0 RECTED FOP, AfdD ON BEHALF OF THE CITY OF CORPUS CHRISTI TO ENTER IPITO AN OIL AND GAS LEASE WITH MAPLE ViILSON FOR THE LEASING ON A ONE— EIGHTH (1/2) ROYALTY AND CASH BONUS BASIS ON THOSE CERTAIN LANDS OWNED BY THE CITY OF CORPUS CHRISTI, NUECES COUNTY, TEXAS, WHICH THE CITY OWNS ONLY AN UNDIVIDED ONE —HALF (1/2) MINERAL INTEREST, DESCRIBED AS LOTS 9 AND 10, SECTION 21, OF THE FLOUR BLUFF AND ENCINAL FARM AND GARDEN TRACTS, CONTAINING FORTY (40) ACRES OF LAND, IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF SAID LEASE, A COPY OF WHICH IS ATTACHED HERETO AND MADE A PART HEREOF. 43g5 OIL AED GAS LEASE THIS AGREEMENT, Fade and entered into the day of , 1955. by and betweenTHE CITY of CORPUS CNRl9TI, TEXAS, CORPORATION, A MUNICIPAL it hereinafter called lessor, and MAPLE WILSON, OF LUBBOCK, TEXAS hereinafter called lessee: ni I _. A; G .S S E_ V: That the said lessor, for and in consideration of "'en and Ito /100 Dollars 010.00 and other good and valuable corsideration, cash in hand paid, the receipt of which is hereby acknowledged, and of the covenants and agreements hereinafter contained on the part of lessee to be paid, kept and performed, has granted, demised, leased and let, and by these presents does grant, lease and let unto the said lessee for the sole and only purpose of exploring, drilling, mining, and operating, for oil and gas and of laying pipe lines and of building tanks, power stations and structures thereon necessary to produce, save and take care of said products, but only one house for housing its em- ployees, all that certain tract of land situated in the county of NUECES , State of Texas, described as d follows, to -wit: LOTS Nos. MINE (9) AND TEN (10), SECTION ND. TWENTY -ONE (21) OF THE FLOUR BLUFF AND ENCINAL FARM AND GARDEN TRACTS OF NUECES COUNTY, TEXAS, AS SHOWN BY NAP OR PLAT OF SAID SUBDIVISION OF RECORD IN VOLUME A, PAGE 43, OF THE MAP RECORDS OF NUECES COUNTY TEXAS, TO WHICH REFERENCE 13 HERE MADE, CONTAINING FORTY (4+0) ACRES OF LAND. It is agreed that this lease shall remain in force for a term of five (5) years from this date, said term being here- inafter called "Primary Term" amd as long thereafter as oil or gas, or either of them is produced from said land by the lessee, In commercailly paying quantities. In consideration of the premises the said Lessee covenants and agrees: The royalties reserved by Lessor and to be paid by Lessee to Lessor, free from all costs to Lessor, manufacturing or otherwise, except for Lessors share of severance, ad valorem, and other taxes normally charged to Lessor's interest, are: (a) ors oil, one - eighth (1 /8th) of that produced and saved from said land, the same to be delivered, at the option of Lessor, at the wells, or to the credit of Lessor into the pipe line to wrath, the wells may be connected; and (b) on gas, including casinghead gas or other gaseous substance, produced from said land and sold or used off the premises, or sold. at the wells, (and except for the gasoline, condensate, or other products ex- wracted or manufactured therefrom, which items are covered by (c) hereof), the royalty shall be one - eighth (1 /8th) of the amount realized from such sale or one - eighth (1 /8th) of the market price thereof, whichever is higher; and (a) one - eighth (1 /8th) of the net amount of gasoline, condensate;, or other products extracted or manufactured, from natural or casinghead gas or other gaseous substance produced from said land; and, at the option of Lessor, Lessee agrees to take or purchase all of the same at the market price. Lessee shall be under the express duty of removing from the gas produced, including casinghead gas or other gaseous sub- stance, the liquid hydrocarbon content (whether in gaseous, spray, liquid or other form), so far as is practicable, by separators, dehydrators, or other standard process presently, or in the future, In use by the industry in general, and in such manner as a normal prudent operator would do under the same or similar circumstances; I:essee, for the benefit of the Lessor, shall exercise such reason- able diligence to procure a market for the production of any g?$ well as a reasonably prudent operator would do under the same or similar circumstances; and (d) on all other minerals mined or market- ed, one - eighth (1 /8th) either in kind or value at the well or mine, 2 at Lessor's election, While there is a Gas well on this lease, but gas is not being sold or used, Lessee may pay as royalty at monthly intervals a sum, equal to one - twelfth (1/12) of the amount of the annual rental payable in lieu of drilling operations dur- ing primary term on the number of acres subject to this lease at thetime such payment is made, and 11' such payment is made, or tendered, it will be consld.ered, that r;as is being produced from I;is lease in paying au utities. Lessee shall have free use of oil, ;a s, coal and neater from said lard, except water from Lessor's wells, for all operat.icn!� here,=der, and the royalty on oil, gas end coal shall be computed ,after deducting, any so used. Lessor shall have the privilege at his risk and expense of using , as from any gas well on said land for stoves and inside lights in the principal dwelling thereor_ out of any surplus gas not needed for operations hereunder. if no well be commenced on or before the day of 1956, this lease shall termLrzate as to both parties, unless the Lessee ors or before that ;fate shall pay or tender to the Lessor, or to the Lessor's credit ir. the Corpus Christi National Bank at corpus ;hrlstl, Texas, or its successors, or in the rank at jor its successors, which shall continue as the depository, regardless of changes in the ownership of said land, the suu of Forty and ho /100 ( ,140.00) Dollars, which shall operate as rental and cover the privilege of deferring the commencement of a well for twelve months, from said date. In like manner and upon like payments or tenders the commencement of a well may be further deferred for like periods of the same number of months sucessively, but only only during the primary term. And it is understood and agreed that the consideration first recited herein, the down payment, covers not only the privilege granted to the date when said first rental Is payable as aforesaid, but also the Lessee's option of extending that period as aforesaid, and any and all other rights conferred. - 3 - Should the first well drilled on the above described land be a dry hale, then and in that event, if s second well Is not cor.menced on said land within: twelve (12) months, there- after, this lease shall terminate as to both parties, unless the Lessee on or before the expiration of said twelve (12) months shall resume the payment of rentals in the same manner as hereinbefore arovided. And it is agreed that upon the re- sumptlon of the payment of rentals, as 'before provided, that the last preceding paragraph hereof, shall continue in force just as though there had been no interruption in the rental payments. If, at the expiration of the primary term of this lease, oil or gas is not being produced on the leased premises, but Lessee is then enga ed in drilling for oil or gas, then this lease shall continue in force so long as drilling operations are being continuously prosecuted on the leased premises; a..d drilling operations shall be considered to be continuously prosecuted if not more than sixty (64) days shall elapse between the 3o- iplation or abandonment of one well and the beginning, of operations for the drilling of a subsequent well. if oil or gas shall be discovered and produced from any such well or wells drilled or being drilled at or after the expiration of the primary term of this lease, this lease shall continue in force so long as oil or gas shall be produced from the leased premises. It is specially agreed that in the event that oil or gas is being; produced or is obtained from said premises after the expiration of the primary term hereof and said production shall for any reason cease or terminate, Lessee shall have the right at any time within ninety (90) days from the cessation of such pro- duction to resume drilling operations in the effort to make said leased premises again produce oil or gas, in which event this lease shall remain in force so long assuch operations are continu- ously prosecuted, as defined in the preceding paragraph, and if - 4 - the;i result in production of oil or gas, so long thereafter as oil or Eas Is produced from the premises. If said Lessor owns a less interest in the above described lard than the entire and undivided fee simple estate or no interest therein, then the royalties and rentals herein, provided for shall be paid the said Lessor only in proportion which Leseor's interest, if any, bears to the whole and undivided fee. Lessee shall have the right to use, free of cost, gas, oil and water produced on said land for all operations thereon, ex- cent from water wells of Lessor. When requested by Lessor, Lessee shall biry pipe line below plow depth. No well shrill be drilled nearer than two hundred (200) feet to the house or barn now on said premises without the written consent of the Lessor. Lessee shrill }pay for damaEes caused by all operations to crowi:� crops o,l ssid land. Lessee shell have the right at any time tc remove all machinery and fixtures placed on said premises, incluain_ the right to draw and remove casing. if the estate of either party hereto is the privilete of assinnenZ in whole or in pars; Is expressly allowed, the covenants hereof shall extend to their heirs, executors, administrators, successors, or assigns, but no chance 1. the ow ershlp of the land or assignment of rentals or royalties shall be binding on the Lessee until after the Lessee has been ftrnished with a written transfer or assignment, or a, certified copy thereof. and It is hereby agreed that in the event this lease shall be assigned as to a part or as to parts of the above describe- ed lands and assigns or assignees of such part or parts shall fall or make default in the payment of the proportionate part of the rents due from him or them, such default shall not operate to defeat or affect this lease so far as it covers a part or parts of said land upon which the said Lessee or any assip,�ees thereof shall make due paymezlt of said rental. Lessee shall have the exclusive right to build, operate and maintain pits, reservoirs, pickup stations and. plants for the pur- - 5 - pose of picking; up and conserving the waste oil that flows down the creeks, ravines and across the land embraced in this lease, whether said oil is produced from land covered by this lease or other lands, and .Lessor shall be entitled to receive the royalty hereinbefore reserved on all such oil so saved. In case of cancellation or terminatlim of this lease for any cause, Lessee shall have the right to retain under the terms hereof (20) acres of land around each oil or gas well producing, being worked on or drilling hereunder (as long as such operations are continued in good faith) such tract to be designated by Lessee in as near a square form as practicable. In the event Lessor considers that Lessee has not complied with all its obligations hereunder, both express and implied, before production has been secured or after production has been secured, Iessor shall notify Lessee in writing, setting out specifically in what respects Lessee has breached this contract. Lessee shall thenhave s ?xty (60) days after receipt of said notice within which to meet or commence to meet all or any part 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 service of such notice on Lessee. neither the service of said notice nor the doing of any acts by Lessee aimed to meet all of any of the alleged breaches shall be deemed anadmission or presumption that Lessee has failed to per- form all its obligations hereunder. Lessee shall pay Lessor for all reasonable damages to Lessor's present and future crops and the surface caused, directly or inn directly, by Lesseets operations. Lessee agrees to haul off and away from the leased premises drilling muds and the drilling residue and all $ebris connected with the drilling or operation of the wells and premises as promptly as caA be reasonably done after drilling of each and every well on the herein described land - 6 - and to promptly level the land and restore the same to the high state of cultivation that the same was in prior to the drilling; of any well as far as is practicable. Lessee will at all times conduct his operations in such manner as to aid In the preservation of the surface farming use and value of this land commensurate with the best standards of the industry. In laying pipe lines Lessee shall. perform the ditching opera- tions in such manner that upon the recovering of the ditches that the top soil will be replaced at the top surface of the ground, level with the ground., as far as practicable. Ubon the termination, abandonment, or release of the land covered by this lease, or any part thereof, Lessee shall remove an7' remaining equipment, debris and rubbish and completely clean up all drilling sites, to restore the same in as good farmin, cond tion as it was before the Commencement of the drillin, operations. 'she conditions and provisions of this particular paragraph shall apply, for the benefit of the Lessor, notwit7- StaUdin any other provisions to the contrary elsewhere pro- vided ii., this lease. Lessor hereby warrants and agrees to defend the title to the lard herein described and agrees that the Lessee shall have the right at any time to redeem for Lessor by payment any mortgages, taxes or other liens or interest and other charges on the above described lands in the event of default of payment by Lessor and be subrogated to the rights of the holder thereof and to deduct so paid from rentals or other payments due or which may became due under this lease. All express or implied covenants of this lease shall be subject to all Federal and. State laws, Executive orders, rules cr regulations and this lease shall not be terminated, in whole or in part, nor Lessee held liable in damages for failure to comply therewith, if compliance is prevented by, or if such failure is the result of, any such law, order, rule or regulation. - 7 - LESSON HEREBY ACKNOWLEDGES THAT HE HAS RECEIVED FROM LESSEE FOR HIS OWN USE AND REFERENCE A TRUE AND CORRECT COPY OF THIS LEASE. IN TESTIMONY WHEREOF, WF SIGN, THIS THE DAY OF 1955- THE CITY OF CORPUS CHRISTI, TEXAS BY CITY MANAGER ATTEST; LESSOR CITY SECRETARY APPROVED AS TO LEGAL FORM OCTOBER , lvj5: CITY ATTORNEY APLE �,h LSON LESSEE _8_ THAT THE FOREGOING ORDINANCE �W/AfS READ FOR Fil T TIME AND PASSED TO ITS SECOND READING ON THIS THE rff. AY OF r Ci i 9 1955, BY THE FOLLOWING VOTE: FARRELL D. SMITH MINOR CULL) W. J. ROBERTS B. E. BIGLER T MANUEL P. MALDONADO THAT THE FOREGOING ORDINANCE WAS READ FOR THE SECOND TIME AND PASSED TO ITS THIRD READING ON THIS tHE DAY OF , 1955, BY THE FOLLOWING VOTE: FARRELL D. SMITH MINOR CULLI W. J. ROBERTS B. E. BIGLER MANUEL P. MALDONADO TT THAT THE FOREGOING ORDINANCE WAS READ FOR THE THIRD TIME AND PASSED FINALLY ON THIS THE DAY OF , 1955, BY THE FOLLOWING VOTE: FARRELL D. SMITH MINOR CULL] W. J. ROBERTS B. E. BIGLER MANUEL P. MALDONADO PASSED AND APPROVED, THIS THE DAY of MAYOR THE CITY OF CORPUS CHRISTI, TEXAS ATTEST: CITY SECRETARY APPROVED AS TO LEGAL FORM: CITY ATTORNEY 1955• THAT THE FOREGOING ORDINANCE WAS READ FOR T E FIRST TIME AND PASSED TO ITS SECOND READING ON THIS THE (:Y�, DAY OF 1955, BY THE FOLLOWING VOTE: THAT THE FOREGOING ORDINANCE WAS READ FOR THE /S F,�OND TIME AND PASSED TO ITS THIRD READING ON THIS THE �D AY OF /, ` / , 1955, BY THE FOLLOWING VOTE: FARRELL D. SMITH (iVjf� MINOR CULLI W. J. ROFiERTS B. E. BILLER: MANUEL P. MALDONADO THAT THE FOREGOING ORDINANCE WAS READ FOR THE 'THIRD TIME AND PASSED FINALLY ON THIS THE �955� L BY THE FOLLOWING VOTE., FARRELL D. SMITH MINOR CULLI W. J. ROBERTS B. E. BIGLER L/i.(.1,G'�!✓� MANUEL P. MALDONADO - '"Ci�{,(�° °' PASSED AND APPROVED, THIS 'rHE DAY OF ?955• l MAYOR - THE CITY OF CORPUS CHRISTI, TEXAS ATTEST: i,Cam / CITY SECRETARY J APPROVED AS TO�EGAL FORM: CITY ATTORNtl / U 4395 FARRELL D. SMITH l MINOR CULLI W. J. ROBERTS B. E. BIGLER t , MANUEL P. MALDONADO THAT THE FOREGOING ORDINANCE WAS READ FOR THE /S F,�OND TIME AND PASSED TO ITS THIRD READING ON THIS THE �D AY OF /, ` / , 1955, BY THE FOLLOWING VOTE: FARRELL D. SMITH (iVjf� MINOR CULLI W. J. ROFiERTS B. E. BILLER: MANUEL P. MALDONADO THAT THE FOREGOING ORDINANCE WAS READ FOR THE 'THIRD TIME AND PASSED FINALLY ON THIS THE �955� L BY THE FOLLOWING VOTE., FARRELL D. SMITH MINOR CULLI W. J. ROBERTS B. E. BIGLER L/i.(.1,G'�!✓� MANUEL P. MALDONADO - '"Ci�{,(�° °' PASSED AND APPROVED, THIS 'rHE DAY OF ?955• l MAYOR - THE CITY OF CORPUS CHRISTI, TEXAS ATTEST: i,Cam / CITY SECRETARY J APPROVED AS TO�EGAL FORM: CITY ATTORNtl / U 4395