HomeMy WebLinkAboutContract 37577 CITY SECRETARY
31,512
^ONTRACT NO.
MEMORANDUM OF OIL AND GAS LEASE
STATE OF TEXAS §
§ KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF TARRANT § i{}
BE IT REMEMBERED that on the lak- day of - , 2008, a Paid Up
Oil and Gas Lease was made and entered into by and between the LITY OF FORT 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., an Oklahoma limited liability
corporation, 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 J;Mday of , 2008.
LESSOR: LESSEE:
CITY OF FORT WORTH CHESAPEAKE EXPLORATION, L.L.C.,
An Oklahoma limited liability corporation
By: 5Xthd9 to gQSTa_ By: Cliff I.Merritt
Title: Assistant City Manager Its: Land Manager
ATTEST: L-!
' contt Authorizatioa
City Secretary ��� �C�
fat@
APPROVED AS TO FORM AND LEGALITY:
By: � � -
Assistant City Att rney
Date: U
OFFICIAL,RECORD
CITY SECRETARY
1 FT.WORTH,TX
ACKNOWLEDGEMENTS
THE STATE OF TEXAS §
COUNTY OF �— §
BEFORE ME, B the undersigned notary public, on
this day personally appeared nown to me to be the person whose
name is subscribed to the foregoing instrument and acknowledged, that (s)he has executed the
same for the purposes and consideration therein expressed.
�t
GIVEN under my hand and seal of office this day of ,
2008.
Notary Public, State of Texas
My Commission Expires: -0011
Commission Number: DO ..—,
`�
HEETME LANE
F' MY COMMISSION EXPIRES
July 26,2011
STATE OF OKLAHOMA §
COUNTY OF OKLAHOMA §
This instrument was acknowledged before me this of U , 2008,
by Cliff J. Merritt as Land Manager of Chesapeake Exploration, L.L.C. on behalf of said
corporation.
e
Nota ublic, State of Oklahoma
#07004805
My Commission Expires: =u6EXP.05115111 gE
Commission Number:
OFFICIAL RECORD
CITY SECRETARY
2 FT WORTH, TX
EXHIBIT"A"
(Worth Heights Park)
Lots 20, 21, 22, and 23, Block 30, Worth Heights Addition, an addition to the City of Fort Worth, Texas,
according to Plat recorded in Volume 204-A, Page 150 of the Plat Records,Tarrant County, Texas.
OFFICIAL RECORD
CITY SECRETARY
3 FT.WORTH,TX
Pagel of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 7/29/2008
DATE: Tuesday, July 29, 2008
LOG NAME: 30WORTH HEIGHTS REFERENCE NO.: L-14615
SUBJECT:
Authorize Execution of a Lease Agreement with Chesapeake Exploration, LLC, with a Bonus
Amount of $6,600.08 and a Twenty-Five Percent Royalty for Natural Gas Drilling under Worth
Heights Park Located at 3812 South Jones Street
RECOMMENDATION:
It is recommended that the City Council authorize execution of a lease agreement with Chesapeake
Exploration, LLC, with a bonus of $6,600.08 and a twenty-five percent royalty for natural gas drilling
under .057392 acres, more or less, of City-owned properties located in Tarrant County, Texas, known as
Worth Heights Park located at 3812 South Jones Street, for a two-year primary term.
DISCUSSION:
On February 26, 2008, (M&C L-14479) Fort Worth City Council authorized the conversion of dedicated
parkland known as Worth Heights Park for the purpose of subsurface drilling and extraction of natural gas.
On February 19, 2008, (M&C L-14472) Fort Worth City Council authorized City staff to advertise a request
for proposals from private companies to drill for natural gas under 5,422 estimated mineral acres of City-
owned properties, including 500 acres of miscellaneous parcels and right-of-way. Worth Heights Park is
located at 3812 South Jones Street. Acceptance of this lease agreement will reduce the approved 500
miscellaneous mineral acres of City-owned parcels by 0.57392 net mineral acres, more or less.
A request for bid proposals (RFP) for Worth Heights Park was advertised for three consecutive weeks in
the Fort Worth Star-Telegram, published on April 4, April 10, and April 17, 2008.
The following sealed bids for the gas lease were received and opened on April 24, 2008:
Bidder Lease Bonus/Acre Total Lease Bonus Percent Royalty
Chesapeake Exploration, LLC $11,500.00 $6,600.08 25
XTO Energy, Inc. $10,521.00 $6,038.21 25
The bids received were 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 First Amendment to City Secretary Contract No. 29698, Alternative Assets Agency
Account Agreement with JPMorgan Chase and the City, 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 from
JPMorgan Chase is estimated to be $6,270.07, more or less.
http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 9/12/2008
Page 2 of 2
The City has established a Minority Women Business Enterprise (M/WBE) participation goal of three
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 three percent M/WBE goal or
the inclusion of an M/WBE investor. This lease is less than 40 acres therefore no MNVBE participation goal
is required.
Revenues received from this lease will be administered in accordance with the current City Council Policy
on Gas Well Revenues.
The Property is located in COUNCIL DISTRICT 9, Mapsco 91 E.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Engineering Department is responsible for the collection and deposit
of funds from this agreement.
TO Fund/Account/Centers FROM Fund/Account/Centers
C282 446100 801929990100 $6,600.08 C282 VARIOUS 801929990100 $330.01
Submitted for City Manager's Office by: Fernando Costa (8476)
Originating Department Head: A. Douglas Rademaker (6157)
Additional Information Contact: Jean Petr (8367)
http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 9/12/2008