HomeMy WebLinkAbout17262 ORD - 09/23/1982AN ORDINANCE
AUTHORIZING THE EXECUTION OF A THREE YEAR MINERAL LEASE
FOR THE 0.91 ACRE McBRIDE LANE WASTEWATER LIFT STATION,
5.0 ACRES IN THE COASTAL STATES REFINERY, AND A 0.158
ACRE VACANT LOT ON DONA STREET WITH SEXTON OIL AND
MINERALS CORPORATION; 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 a three
year mineral lease for the 0.91 acre McBride Lane Wastewater Lift Station,
5.0 acres in the Coastal States Refinery, and a 0.158 acre vacant lot on Dona
Street with Sexton Oil and Minerals Corporation for a cash bonus of $312.51,
an annual delay rental of $60.68, and a 20 percent royalty, all as more fully
set forth in the lease agreement, a substantial copy of which is attached
hereto and made a part hereof, marked Exhibit "A."
SECTION 2. That upon written request of the Mayor or five Council
members, copy attached, to find and declare an emergency due to the need of
executing the aforesaid date mineral lease so that exploration may start at
the earliest possible date, such finding of an emergency is made and declared
requiring suspension of the Charter rule as to consideration and voting upon
ordinances or resolutions at three regular meetings so that this resolution
is passed and shall take effect upon first reading as an emergency this the
..23Alday of September, 1982.
ATTEST:
y Secretary
APPROVED:22.43AV OF SEPTEMBER, 1982
J. BRUCE AYCOCK, CITY ATTORNEY
stant City Attorney
1
MAY
17262
THE ITY OF CORPUS CHRISTI, TEXAS
SEP 2 8 1984
*Cal !WED
OIL AND GAS LEASE
AGREEMENT, made and entered into the 22nd day of September, 1982, by and be-
tween the City of Corpus Christi whose post office address is Box 9277, Corpus
Christi, Texas 78408, hereinafter called Lessor (whether one or more), and Sexton
Oil and Minerals Corporation, hereinafter called Lessee, whose address is 1040
First City Bank Tower, Corpus Christi, Texas 78477.
1. WITNESSETH: That the said Lessors, for and in consideration of Three
Hundred Twelve and 51/100 Dollars ($312.51) cash in hand paid, 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 for, and producing
oil and gas, subject to limitations contained herein, all that certain tract of
land situated in the County of Nueces, State of Texas, described as follows, to
wit:
1. 0.91 acres of land, more or less, as described in Volume
873, Page 140, of the Deed Records of Nueces County, Texas,
dated November 25, 1959. Said land being a portion of a
5.8 acre tract, known as the Kaler Tract, lying West of the
City of Corpus Christi, Texas, out of the original grant
to Enrique Villareal and being also a portion of the Ehler
21.78 acre tract.
II. 5.00 acres, more or less, out of the 89.45 acre tract of
land as described in Volume 1116 at Page 112 of the Deed
Records of Nueces County, Texas, dated August 10, 1964.
III. 0.158 acres, more or less, being Lot 26, Block 2, Dona
Park Addition, as described in Volume 1753, Page 755, of
the Deed Records of Nueces County, Texas.
2. For the purpose of determining the amount of any money payment here-
under, said land shall be considered to comprise 6.068 mineral acres, even though
it actually comprises more or less, subject to paragraph 10.
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 subject
to termination provisions and 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, a one-fifth (20)1) of
that produced and saved from the net city land, the same to be delivered at the
wells or to the credit of Lessor into the pipeline to which the wells may be con-
nected; (b) on gas, oil, or other substance from a well defined by the Texas Rail-
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road Commission as a gas well, produced from the net city land and sold or used
off the premises, the market value at the well of a one-fifth (201) of the gas
or oil so sold or used. Lessor reserves the right at his option, to at any time
take his share of the oil, oil well gas, gas well gas, and associated liquids,
in kind, all delivered at the wellhead.
5. If production of oil and/or gas is not obtained on said land on or be-
fore the 22nd day of September, 1983, this lease shall terminate as to both par-
ties, unless Lessee on or before that date shall pay or tender by the check or
draft of Lessee, and delivered or mailed to Petroleum Superintendent, P. 0. Box
9277, Corpus Christi, Texas 78408, the sum of $10.00 per acre, which shall oper-
ate as rental and cover the privilege of deferring the production of oil and/or
gas for twelve (12) months, from said date. In like manner, and upon like pay-
ments 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 according to
its terms and shall not be allocated as mere delay rental for any period. The
term "production of oil and/or gas" means production of oil and/or gas in paying
quantities.
6. During the primary term, any portion of or all the 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.
7. Lessee is hereby given the right and power to unitize or combine the
land covered by this lease or any portion thereof, subject to compliance with
the requirements for City Drilling Blocks, for gas or oil with any other land,
lease, or leases located adjacent to or contiguous with, when in Lessee's judg-
ment 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 360 acres in size. If production is found on the -
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 speci-
fied, 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
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unit or his royalty interest therein bears to the total acreage so pooled in
the particular unit involved.
8. If at the expiration of the primary term, oil and/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 they 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.
9. 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 as-
signs, but no change or divisions in ownership of the land or royalties, however,
accomplished, shall operate to enlarge the obligation 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.
10. Lessor does not warrant the title to said land and it is agreed that
if Lessor owns an interest in said land more or less than the entire fee simple
estate, then the royalties to be paid Lessor shall be increased or reduced pro-
portionally.
11. Upon expiration or termination of this lease, or portion thereof, Lessee
shall provide Lessor a written release of all Lessee's rights or interest in the
minerals so expiring or terminating.
12. Nothing in the lease granted the Lessee will serve as the right to lay
pipelines or operate drilling rigs from the surface of the above described land.
13. The Lessee will be responsible for damages resulting from the Lessee's
acts, negligence, and/or wrongful conduct of operations. Nothing in the lease
granted the Lessee is intended to absolve the Lessee of this legal obligation.
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 or gas therefrom by reason of strike, by operation of force
najeure 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 therewith; 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 pro-
ducing 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.
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 1982
CITY OF CORPUS CHRISTI, TEXAS
BY:
Edward A. Martin LESSOR
City Manager
BY:
CITY ATTORNEY LESSEE
THE STATE OF TEXAS X
COUNTY OF NUECES X
BEFORE ME, the undersigned authority, on this day personally appeared
Edward A. Martin, 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 acknowledge to me that he executed the same for the purposes and consider-
ation therein expressed, and in the capacity therein stated and as the act and
deed of said City.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the day of
1982.
Notary Public, Nueces County, Texas
THE STATE OF TEXAS X
COUNTY X
BEFORE ME, the undersigned authority, on this day personally appeared
of Sexton Oil and Minerals Corporation, known to me
to be the person whose name is subscribed to the foregoing instrument, and ac-
knowledged to be 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
1982.
Notary Public
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Corpus Christi, T:/as
caiday of
1982
TO THE MEMBERS OF THE CITY COUNCIL
Corpus Christi, Texas
For the reasons set forth in the emergency clause of the foregoing ordinance or resolution,
an emergency exists requiring suspension of the Charter rule as to consideration and voting
upon ordinances or resolutions at three regular meetings; 1/we, therefore, request that you
suspend said Charter rule and pass this ordinance or resolution finally on the date it is
introduced, or at the present meeting of the City Council.
Respectfully,.
Council Members
The above ordinance was
Luther Jones
Betty N. Turner
Jack K. Dumphy
Bob Gulley
Herbert L. Hawkins, Jr.
Dr. Charles W. Kennedy
Cliff Zarsky
Respectfully,
MAYOR
THE CIT OF CORPUS CHRISTI, TEXAS
passed by the following vote:
17262