HomeMy WebLinkAboutContract 35907 CITY SECRETARY,
NO
MEMORANDUM OF OIL AND GAS LEASE
STATE OF TEXAS §
§ KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF TARRANT §
BE IT REMEMBERED that on theay of 2007,a Paid Up
Oil and Gas Lease was made and entered into by and between the CITY O ORT WORTH,a
home rule municipal corporation of the State of Texas, c/o Director, Department of
Engineering, 1000 Throckmorton Street, Fort Worth, Texas 76102, hereinafter called
"(LESSOR)"; and CHESAPEAKE EXPLORATION, L.L.C., successor by merger to
Chesapeake Exploration Limited Partnership, P.O. Box 18496, Oklahoma City, Oklahoma
73154,hereinafter called("LESSEE"),where LESSOR hereby grants,leases and lets exclusively
to LESSEE for the purpose of exploring for, developing, producing and marketing oil and gas,
together with any liquid or gaseous substances produced in association therewith, from the
following described land situated in Tarrant County,Texas,to-wit:
SEE EXHIBIT"A"ATTACHED HERETO AND MADE A PART HEREOF
Subject to the other provisions therein contained, said lease provides for a primary term
of two (2) years, from the date thereof, and as long thereafter as oil or gas or other substances
covered therein are produced in paying quantities from the leased premises or from lands pooled
therewith,or this lease is otherwise maintained in effect pursuant to the provisions therein.
An Executed copy of said Oil and Gas Lease is in the possession of LESSEE at its
address indicated above.
Executed this the blldhay of 07.
LESSOR: LESSEE:
CITY OF FORT WORTH CHESAPEAKE EXPLORATION,L.L.C.,
successor by merger to Chesapeake
Explor tion Limit Ptnership
By: Marc A.Ott By:Cli erritt
Title:Assistant City Manager Awistant City Manaqgg:Land anager C�
ATTEST:
LJP0A
City Secretary
APPROVED AS TO FORM AND LEGALITY:
Assistant City Attrneyy
Date: �o07
contract Authorization
Date
Uy-
ACKNOWLEDGEMENTS
THE STATE OF TEXAS §
COUNTY OF '14 rrahT §
BEFORE ME, > e?Tj )ah the undersigned notary public, on
this day personally appeared Mare,A.P-rT known to me to be the person whose
name is subscribed to the foregoing instrument and, that (s)he has executed the same for the
purposes and consideration therein expressed. --nq
GIVEN under my hand and seal of office this day of�C
2007.
Notary Public,St to of Texas
My Commission Expires:
Commission Number: G)D1oR36$1
H-TT!E LANE
MY COMMISSION EiPIPFS
Juy 26,201 t
STATE OF OKLAHOMA
COUNTY OF OKLAHOMA §
This instrument was acknowledged before me this of Cj11 ,2007,
by Cliff J. Merritt as Land Manager of Chesapeake Exploration,L.L.C.on beIialf of said
corporation.
No ary Public,State of Oklahoma
Xi.
My Commission Expires: wo+ooagos`
Commission Number:
bnnnu.Do
2
EXHIBIT"A"
A 16.52 acre tract of land being out of, and a part of the W.H. Little Survey, Abstract Number 945 as
described by metes and bounds as follows:
Beginning at a point in the north line of the W.H.Little Survey south 89 degrees 44 minutes east 354 feet
from its northwest corner, said point being the northeast corner of Block A of the partition of the T.G.
Gilmore Estate.Thence southeasterly,along the east line of said Block A and of strip 6 of the Partition of
the T.G. Gilmore Estate, to a point in the east line of said strip, 188.6 feet from its north corner, from
which an iron bears north 68 degrees west 90.5 feet. Thence south 68 degrees east 450.8 feet to an iron.
Thence south 86.5 degrees east 24.3 feet to a point in the southeast line of said tract conveyed by City of
North Fort Worth to City of Fort Worth,being the northwest line of a tract conveyed to Tarrant County
by a deed of record in Volume 229, Page 619 of the Tarrant County Deed Records. Thence north 33
degrees 49 minutes east,with said line,550 feet to the southeast corner of said City of Fort Worth tract,a
point in the middle of the Trinity River. Thence up said river,with its meanders,to the northeast corner
of said City of North Fort Worth tract in the north line of said Little Survey. Thence, along said line,
north 89 degrees 44 minutes west to the place of beginning and estimated to contain 16.52 acres.
A 0.218 acre tract of land being out of, and a part of the W.H. Little Survey, Abstract Number 945 as
described by metes and bounds as follows:
Beginning at the north corner of Strip 6. Thence south 15 degrees 57 minutes east, along the northeast
line of said strip 188.6 feet. Thence north 68 degrees west 90.5 feet to an iron. Thence north 20 degrees
07 minutes west 68.5 feet to a point in the northwest line of said strip. Thence,along said line,north 33
degrees 48 minutes east 100 feet to the place of beginning.
A 4.00 acre tract of land being out of, and a part of the W.H. Little Survey, Abstract Number 945 as
described by metes and bounds as follows:
Beginning at the southeast corner of said Block A. Thence,along the southeast line of Block A,south 33
degrees 48 minutes west 100 feet to a point from which an iron bears south 20 degrees 07 minutes east
68.5 feet. Thence north 20 degrees 07 minutes west 758.9 feet. Thence north 13 degrees 34 minutes west
685.2 feet to a point in the north lines of said block A. Thence, along said line, south 89 degrees 44
minutes east 153.2 feet to the northeast corner of said Block A. Thence along the east line of said Block
A to the place of beginning.
3
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 7/10/2007
DATE: Tuesday, July 10, 2007
LOG NAME: 30LITTLEGILMORE REFERENCE NO.: **L-14343
SUBJECT:
Approve Acceptance of Lease Agreement with Chesapeake Exploration Limited Partnership for
Natural Gas Drilling under 20.738 acres, more or less, of City-Owned Properties Located in Tarrant
County, Texas, known as "W. H. Little Survey & T. C. Gilmore Estates Addition — 20.738 Acres"
RECOMMENDATION:
It is recommended that the City Council approve the acceptance of a lease agreement for natural gas
drilling under 20.738 acres, more or less, of City-owned properties located in Tarrant County known as "W.
H. Little Survey & T. C. Gilmore Estates Addition — 20.738 Acres" to Chesapeake Exploration Limited
Partnership for a two-year term.
DISCUSSION:
On May 17, 2005, (M&C G-14798) Fort Worth City Council authorized City staff to advertise a request for
proposals from private companies to drill for natural gas under 3,651 estimated mineral acres of City-
owned properties including 500 acres of miscellaneous parcels and right of way. The W. H. Little Survey &
T. C. Gilmore Estates Addition — 20.738 Acres lease is located west of 1-35 between Cold Springs Road
and the Trinity River just south of Northside Drive. Acceptance of this lease agreement will reduce the
approved 500 miscellaneous mineral acres of City-owned parcels by 20.738 mineral acres more or less.
A request for bid proposals (RFP) for "W. H. Little Survey & T. C. Gilmore Estates Addition —20.738 Acres"
was advertised for three consecutive weeks in the Commercial Recorder, published on May 10, May 17
and May 24, 2007.
The following sealed bid for the gas lease was received and opened on May 31, 2007.
Bidder Lease Bonus/Acre Total Lease Bonus % Royalty
Chesapeake Exploration Limited Partnership $6,675.00 $138,426.15 25
The bid received was evaluated by staff and the City's mineral asset management consultant, JPMorgan
Chase. In addition to the lease bonus rate and royalties paid to the City, the bidder's drilling plan,
reputation, financial status, project team and compliance history were also evaluated.
In accordance with the Alternative Assets Agency Account Agreement between JPMorgan Chase and the
City (City Secretary Contract 29698), JPMorgan Chase will serve as the depository of the lease bonus
revenue until the City requests wire transfer of the funds. The net transfer to the City less administrative
and legal fees is estimated to be $131,504.84, more or less.
The City has established a Minority Women Business Enterprise (M/WBE) participation goal of 3 percent
on City-owned property of 40 acres or more without an investment goal. On leases of City-owned property
of 700 acres or more, the City has established an option of either a 3 percent M/WBE goal or the inclusion
Logname: 30LITTLEGILMORE Pagel of 2
1
of an MNVBE investor. This lease is less than 40 acres therefore no M/VVBE participation goal is required.
It is anticipated that the lease bonus and royalty proceeds will be deposited in the Capital Projects Reserve
Fund.
The Property is located in COUNCIL DISTRICT 2, Mapsco 63 P.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Engineering Department is responsible for the collection of funds due
the City under this agreement.
TO Fund/Account/Centers FROM Fund/Account/Centers
GC10 446100 013010001000 $131.504.84
Submitted for City Manager's Office by. Marc A. Ott (8476)
Originating_Department Head: A. Douglas Rademaker (6157)
Additional Information Contact: Jean Petr(8367)
Lom me: 30LITTLEGILMORE PaaP 7 ^f