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Home My WebLink About16404 ORD - 07/22/1981ls:07/22/81;lst AN ORDINANCE AUTHORIZING EXECUTION OF A THREE-YEAR MINERAL LEASE FOR THE 69.682 ACRE SCOGIN TRACT AT THE INTERNATIONAL AIRPORT TO MURPHY H. BAXTER FOR A CASH BONUS OF $7,107.57, AN ANNUAL DELAY RENTAL OF $696.82, AND A 23% ROYALTY, AS MORE FULLY SET FORTH IN THE LEASE AGREEMENT, A SUBSTAN- TIAL COPY BEING ATTACHED HERETO AND MADE A PART HEREOF, MARKED EXHIBIT "A"; AND DECLARING AN EMERGENCY. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the City Manager be authorized to execute an oil and gas lease for a three-year term on 69.682 acres, located at the Inter- national Airport, being the Scogin Tract, for a cash bonus of $7,107.57, a 23% royalty and an annual delay rental of $696.82, to Murphy H. Baxter, all as more fully set forth in the lease agreement, a substantial copy of which is -attached heretoandmade a part hereof, marked Exhibit "A". SECTION 2. --The necessity toauthorizeexecution of the aforesaid lease agreement at the earliest practicable date creates an imperative public necessity requiring the suspension of the Charter rule that no ordinance or resolution shall be passed finally on the date of its introduction but that such -ordinance or resolution shall be read at three several meetings of the City Council, and the Mayor or Council members, having declared that such necessity exists, having requested the suspension of the Charter rule and that this ordinance be passed finally on the date of its introduction and take effect and be in full force and effect from and after its passage, IT IS ACCORDINGLY SO ORDAINED, this the2-2--day of July, 1981. ATTEST: ter. Secretary APPROVED: .. yDAY OF JULY, 1981: J. BRUCE CO K CITY ATTORNEY By Assistant Cid; „Ptorney 16404 CITY i CORPUS CHRISTI, TEXAS SEP 2 71984' • OIL AND GAS LEASE THIS AGREEMENT, made and entered into the 22nd day of July, 1981, by and between the City of Corpus Christi (hereinafter "Lessor"), whose post office address is Box 9277, Corpus Christi, Texas 78408, and Murphy H. Baxter (herein- after "Lessee"), whose address is Two Allen Center Suite -2950, Houston, Texas 77002. WITNESSETH: 1. _That -the said Lessor, for and in consideration of Seven Thousand ..One Hundred Seven and 57/100 Dollars ($7,107.57) 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 purpose and with -the exclusive right of exploring, drilling - and operating for, producing and owning oil and gas, and of laying pipelines -and of building_ -tanks, telephone -lines, power- stations and other structures _thereon .to, produce, save,_ -treat -and take care of said products, and housing its... employees, subject to limitations contained herein, all that certain tract of land situated in the county of Nueces, state of Texas, described as follows: (Tract A) Beginning at.a point in the East line of the J. L. Scogin property, being a part of Survey 315 in Nueces County,'Texas, _at.a point 180.0 feet South of the South line of State Highway No. 44, said point also being in the West line'of a tract of land purchased by the City of Corpus Christi from Rand Morgan --and recorded in the Deed Records of Nueces_County, Texas; ' Thence South 1° 42' East, along the East line'of the Scogin property and -the West line -of the City of Corpus Christi property, a distance of 3763.17 feet, to a point for corner; ' ` Thence North -45° 00' West, 1176.26 feet, to a point for corner in the West line of said Scogin property and the East line of a tract of land owned by Carter, Ocker and Till; Thence North 10 42' West, along the West line of the Scogin property, a distance of 2906.18 feet to a point for corner 180.0 feet South of the South line of State Highway No. 44; Thence North 88° 14' East, along a line parallel with and 180.0 feet..South of the South line of State Highway No. 44 a distance of 806.7 feet to the place of beginning, and containing 61.755 acres of land. Ex 1,1;1 'Fr, (Tract B) Beginning at the most Southerly corner of the Tract'A described above, said corner being in the East line of the Scogin property at a point 3943.17 feet South of the South line of State Highway No. 44; Thence North 45° West along the Southwest line of the above described tract a distance of 1176.26 feet to a point in the West line of the Scogin property; Thence South 1° 42' East along the West•line of the Scogin property 856.05 feet, to a point for corner; Thence North 88° 18' East, at right angles to the last described line, a distance of 806.70 feet to the place of beginning and containing 7.927 acres of land, and which 7.927 acre tract is immediately adjacent, abutting, and contiguous . to the Southwesternmost boundary line of Tract A above des- cribed by metes and bounds. 2. For the purpose of determining the amount of any money payment here- under, said land shall be considered to comprise 69.682 mineral acres, (hereinafter _"filet City Lands"), even though it actually comprises more or -le -ss, subject to paragraph 9. 3. It -is agreed that this lease shall remain in force for a term of three (3) years from this date, said term -being hereinafter called "Primary Term",; and as long thereafter as either oil or gas is produced from said land by Lessee,T -subject to termination provisions as hereinafter provided. 4. The royalties to be paid Lessor are (a) on oil or oil well gas from a well defined by Texas Railroad Commission as an oil well, twenty-three percent (23%) of that produced -and saved from the Net City Lands, 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 the Net City Lands and sold or used off the premises, the market value at the well of twenty-three percent (23%) of the gas or oil so sold or used. Lessor reserves the right, at its option, to at any time take its share of the oil, oil well gas, gas well gas and asso- ciated liquids in kind, all -delivered at the wellhead. 5. If production of oil or gas is not obtained on said land on or be- fore the 22nd day of July, 1982, this lease shall terminate as to both parties, unless Lessee on or before that date shall pay or tender by the check or draft of Lessee, and delivered or mailed to Lessor in care of Petroleum Superintendent, P. 0. Box 9277, Corpus Christi, Texas 78408, $10.00 per Net City Lands acre, which shall operate as rental and cover the privilege of deferring the - 2 - production of oil or gas for twelve (12) months from said date. In like manner, and upon like payments or tenders annually, the commencement of such production ' may be further deferred for like periods of the same number of months successively during the Primary Term. The cash bonus is to be considered for this Lease accord- ing to its terms, and shall not be allocated as mere delay rental for any period. The term "production of oil or gas" means production of oil or gas in paying quan- tities. During the Primary Term, any portion of or all the Net City Lands herein- above described as subject to this Lease shall be held under this Lease only by the payment of delay rentals or royalty payments provided, however, that upon the expiration of the Primary Term, said Lease will terminate, save as to the number of acres allocated by.the Railroad Commission of Texas for each well from which oil or gas in paying quantities is being produced. —'— 6. Lessee is hereby given the right and power to unitize 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 contiguous with, when in Lessee's judgment i t- ' is necessary or advisable to do so in order to properly develop and operate said.' - premises, upon notifying Lessor, provided that no unit for gas so created shall exceed 360 acres or be less than 320 acres in size. If production is foundonthe- -pooled acreage, it shall be treated as if production is had from this lease, as to. the land so pooled, whether the well or wells be - located on the premises covered by this lease or not. In lieu of the royalties elsewhere herein specified, Lessor - shall receive on production from a unit_so pooled onlysuchportion of -the royalty stipulated herein as the amount of his acreage placed in the unit or his royalty interest therein bears to the total acreage so pooled in the particular unit in- volved. 7. If at the expiration of the Primary Term, oil or gas is not being produced on said lands or on lands pooled herewith, but Lessee is then engaged in drilling or reworking operations therein, the Lease shall remain in force sixty (60) consecutive days, and if such operations result in the production in paying quantities of oil or gas, then said lease will terminate, save as to the number of acres allocated by the Railroad Commission of Texas for such well or wells. 8. 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 - 3 - 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 the royalty hereunder, Lessee may with- hold payment thereof unless and until furnished with a recordable instrument exe- cuted by all such parties designating an agent to receive payment for all. 9. Lessor does not warrant the title to said Net City Lands,- and it is agreed that if Lessor owns an interest in said Net City Lands more or less --than the entire fee simple estate, -then the royalties to paid Lessor shall be increased or reduced -proportionally. 10. Upon expiration or termination of this Lease, or portion thereof, Lessee shall provide Lessor a -written releaseofall Lessee'_s_rights or interest in -:the minerals so expiring or terminating. 11. There shall be no drilling in violation of Federal Aviation Admin--- _istration Regulations or Corpus Christi Airport Zoning Regulations. - 12. Lessee shall provide compensation for damage to surface, crops and -• improvements which may be caused -by -mineral exploration or operations. 13. -The Lessee will be responsible for damages resulting from the Lessee's acts, negligence, or wrongful conduct of operations. Nothing in the Lease granted the Lessee is intended to absolve the Lessee of this_ legal_obliga- tion. -- 14. 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 orr gas therefrom by reason of strike, by operation of force majeure or by any Federal or State law, then while 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 there- with; and this Lease shall be -extended while and so long as Lessee is prevented by any such cause from conducting 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. -4- IN WITNESS WHEREOF, this instrument is executed in duplicate as of the date first above written. ATTEST: • CITY OF CORPUS CHRISTI, TEXAS BY: City Secretary R. Marvin Townsend City Manager LESSOR APPROVED AS TO LEGAL FORM: APPROVED: day of , 1981 BY: Department Head _City Attorney LESSEE THE STATE OR_TEXAS COUNTY OF'NUECES x x 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 tome 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. ---GLVEN_UNDER MY HAND AND SEAL OF OFFICE, this the day of , 1981. - Notary Public THE STATE OF TEXAS x COUNTY OF X BEFORE ME, the undersigned authority, on this day personally appeared MURPHY H. BAXTER, 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 as his free act and deed. GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day of ,-1981. Notary Public Corpus Christi, Te 22— day of TO THE MEMBERS OF THE CITY COUNCIL Corpus Christi, Texas For the reasons set forth in the emergency clause of the foregoing ordinance, a public emergency and imperative necessity exist for the suspension of the Charter rule or requirement that no ordinance or resolution shall be passed finally on the date it is introduced, but that such ordinance or resolution shall be read at three meetings of the City Council; I/we, therefore, request that you suspend said Charter rule or requirement and pass this ordinance finally on the date it is introduced, or at the present meeting of the City Council. Respectfully, Respectfully, Council Members ��// MAYIf The Cit' of Corpus Christi, Texas The Charter rule was suspended by the following vote: Luther Jones Betty N. Turner Jack K. Dumphy Bob Gulley Herbert L. Hawkins, Jr. Dr. Charles W. Kennedy Cliff Zarsky The above ordinance was passed by Luther Jones Betty N. Turner Jack K. Dumphy Bob Gulley Herbert L. Hawkins, Jr. Dr. Charles W. Kennedy Cliff Zarsky the following vote: 16404