HomeMy WebLinkAboutContract 37610 SECRETARY
CONTV `CT NO 13](2La
MEMORANDUM OF OIL AND GAS LEASE
STATE OF TEXAS §
§ KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF TARRANT § y,
BE IT REMEMBERED that on the flay of 2008, a Paid Up
e CITY OF FO
Oil and Gas Lease was made and entered into by and betweenRT 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 f-kday of , 2008.
tj
LESSOR: LESSEE:
CITY OF FORT WORTH CHESAPEAKE EXPLORATION, L.L.C.,
An Oklahoma limited liability corporation
By: F"s r n �{ �, [d o STA By: ClifferAtt
Title: Assistant City Manager Its: Landtanager
ATTEST: L,
contract Authorizatioa
Olid. City ecretary 's k:
Date
APPROVED AS TO FORM AND LEGALITY:
Assistant City Atto ey
Date:
OFFICIAL RECORD
CITY SECRETARY
FT.WORTH,TX
1 � .
ACKNOWLEDGEMENTS
THE STATE OF TEXAS §
COUNTY OF ��¢ivt�� §
BEFORE ME, e , ,e o � the undersigned notary public, on
this day personally appeared ?- � , known 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.
GIVEN under my hand and seal of office this /J' day of ,
2008.
r @` HE i TIE LAwE
e ` MY COwMi 9 SS!ON EXPIRES
JOY 26,2011
otary Pu hc—, tate of lexas
My Commission Expires:
Commission Number: oa G ?359/7
STATE OF OKLAHOMA §
COUNTY OF OKLAHOMA §
This instrument was acknowledged before me this of ' 2008,
by Cliff J. Merritt as Land Manager of Chesapeake Exploration, L.L.C. on behalf ZTf said
corporation.
°JPEN••-E.f l0N' Notary Pu lic, State of Oklahoma
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#07004808
My Commission Expires:=u,=:EXP.06N5t1ir 3`
Commission Number: =9TF
OFFICIAL.RECORD
CITY SECRETARY
2 FT.WORTH, TX
EXHIBIT"A"
(Rodeo Park)
15.354 acres, more or less, being the East one half of Lot 6,the West one half of Lot 7, Lots(s)
8,9,10,11,14R,A of Block 46; Lots 4,5,6,7,8,9,10,14,15,16,17,18,19,20 and 21 of Block 45; Lots
1,2,3,4,5,17,18,19,20,21,22,23 and 24 of Block 44; Lots 1,2,3,4,5,20,21,22,23 and 24 of Block 43; Lots
1,2,22,23 and 24 of Block 42; All lots in Block 39; Lots 3,4,5,6,7,8,9,10,11,12,13,14,15,16,17,18,19 and
20 of Block 38, of the M.G. Ellis Addition, an addition to the City of Fort Worth, Tarrant County, Texas,
thereof recorded in Volume 63, Page 19 of the plat records,Tarrant County, Texas.
3
Pagel of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 5/20/2008
DATE: Tuesday, May 20, 2008
LOG NAME: 30RODEOPARK REFERENCE NO.: L-14559
SUBJECT:
Authorize Execution of Lease Agreement with Chesapeake Exploration, L.L.C., with a
Bonus Amount of $257,563.25 and a 25 Percent Royalty for Natural Gas Drilling Under Rodeo Park,
Located at 2605 North Houston Street
RECOMMENDATION:
It is recommended that the City Council authorize execution of a lease agreement with a bonus of
$257,563.35 and a 25 percent royalty for natural gas drilling under 15.354 acres, more or less, of City-
owned properties located at 2605 North Houston Street in Tarrant County, Texas, in what is known as
Rodeo Park to Chesapeake Exploration, L.L.C., for a two-year primary term.
DISCUSSION:
On January 15, 2008, (M&C L-14461) Fort Worth City Council authorized the conversion of dedicated
parkland known as Rodeo 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 Rodeo Park. Rodeo Park is located at 2605 North Houston Street.
A request for bid proposals (RFP) for Rodeo Park was advertised for three consecutive weeks in the Fort
Worth Star-Telegram, published on January 31, February 7, and 14, 2008.
The following sealed bids for the gas lease were received and opened on February 21, 2008:
Bidder Lease Bonus/Acre Total Lease Bonus Royalty
Chesapeake Exploration, LLC $16,775.00 $257,563.35 25 Percent
XTO Energy, Inc. $13,911.00 $213,589.50 25 Percent
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 bidders' 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 less
administrative and legal fees is estimated to be $252,412.08, 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
http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 9/18/2008
Page 2 of 2
of 700 acres or more, the City has established an option of either a 3 percent M/WBE goal or the inclusion
of an M/WBE investor. This lease is less than 40 acres therefore no M/WBE 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 2, Mapsco 62F and 62G.
FISCAL INFORMATION/CERTIFICATION:
The Finance Director certifies that the Engineering Department is responsible for the collection and deposit
of funds due the City under this agreement. The Parks and Community Services Department will be
responsible for further distribution of the funds deposited according to the current financial policy.
TO Fund/AccounVCenters FROM Fund/AccounVCenters
C282 446100 801929990100 $252,412.08
Submitted for City Manager's Office by: Fernando Costa (8476)
Originating Department Head: A. Douglas Rademaker (6157)
Additional Information Contact: Jean Petr (8367)
hnp://apps.cfwnet.org/council_packet/Reports/mc_print.asp 9/18/2008