HomeMy WebLinkAboutContract 31677� i '�' 4;�C'�'Fir�K=� � �� lJ� (
��`�' � ' � �,�� ;�
ROAD REPAIR AGREEMENT ` ° _ _- _ - _ �
BETWEEN
THE CITY OF FORT WORTH
AND
DEVON ENERGY PRODUCTION COMPANY, L.P.
This Road Repair Agreement, (Agreement), is made and entered into on this the 31 day
of March , 20 O5, by and between the City of Fort Worth, Texas ("City"), a home rule
municipal corporation of the State of Texas, located within Tarrant, Denton, Wise Counties, Texas
(Hereinafter referred to as the "City") and Devon Energy Production Company, L.P. (Devon) ("Op�rator")
for the repair of certain streets and/or roadways within the City of Fort Worth, Texas as more fully
described herein.
WHEREAS, Operator is in the business of drilling gas wells and, in connection th�rewith,
shall be engaged in drilling and production activities on property known generally as
Rethia Seybold Lease and/or Unit , which abuts, is adjacent to, andlor is
accessed by roadways within the City of Fort Worth; and
WHEREAS, use of the roadways by the Operator for the purpose of performing the
activities described hereinabove may cause damage to the roadways; and
WHEREAS, the City and Operator, for the mutual consideration hereinafter stated, desire to
enter into this Agreement for Operator to repair said roadways for the dwation of the term of this
Agreement in consideration of Operator's use of said roadways for the purpose of the activities
described hereinabove;
IT IS NOW THEREFORE AGREED THAT:
ARTICLE 1.
REPAIR OBLIGATION
1. Operator shall repair damages caused by Operator or its contractors, subcontractors,
employees, and agents, excluding ordinary wear and tear, if any, to roadways that abut the above-
described property being used by Operator for the drilling and production of gas wells pursuant to a
Gas Well Permit issued to Operator. The repair obligation shall continue even if the Gas Well
Permit is amended to allow for the drilling of additional gas wells. This obligation shall continue
during the term of this Agreement, and Operator shall, prior to the termination of this Agreement,
as provided herein, repair such damages to such roadways, excluding ordinary wear and tear, if
any, to the condition in which such roadways existed prior to the execution of this Agr�ement,
Operator shall make a videotape of such roadways prior to the start of Operator drilIing and
operation of its gas wells and shall provide a copy of the videotape to the Director of
Transportation and Public Works. Operator shall notify the Director of Transportation and Public
Works when drilling or fracing operations aze complete so that the Director of Transportation and
Public Works can determine if repairs are required.
2. In connection with its obligation to repair said roadways, Operator sl�all use
materials of the same or better quality than those utilized to surface and/or repair the roadways
prior to execution of this Agreement and in accordance with the current standazds specifications of
the City. Deviation from the materials described herein shall not be permitted without the prior
written consent of the Director of Transportation and Public Works. Repairs shall be completed in
accordance with standard engineering practices acceptable to the City.
Operator shall repair the damage to the roadways at its sole cost and expense.
4. Durin� the term of this Agreement, Operator shall periodically inspect the roadways
during drilling, fracture stimulation or reworking of the gas well to determine whether or not any
damage has occurred as a result of Operator's activities. Immediately upon discovering the
existence of any such damage to the roadways, Operator shali undertake to repair and/or remedy
same. Upon discovery of damage by the Operator, the Operator will have 48 hours to contact the
Director of Transportation and Public Works to work out a scheduie of repairs. Repairs sh�ll take
place within 30 days or immediately if the damage affects the immediate health and safety of
individuals.
ARTICLE 2.
TERM OF AGREEMENT
This Agreement shall commence upon the date indicated above and shall continue in fuil
force and effect until Operator has completed and/or permanently discontinued the activities upon
the roadways, as described hereinabove.
ARTICLE 3.
INSURANCE AND INDEMNITY
The Operator shall provide or cause to be provided the insurance described below for
each well unless a Gas Well Permit has been issued wherein such insurance has been provided for
the issuance of the Gas Well Permit under the terms and conditions described in the Fort Worth
"Gas Drilling and Production" Ordinance and such insurance to continue until the well is
abandoned and the site restored.
In addition to the bond or letter of credit required pursuant to this Agreement and the Fort
Worth "Gas Drilling and Production" ordinance, the Operator shall carry a policy or poli�cies of
insurance issued by an insurance company or companies authorized to do business in Texas.� In the
event such insurance policy or policies are cancelled, the Gas Well Permit shall be suspen�ded on
such date of cancellation and the Operator's right to operate under such Gas Well Permit shall
immediately cease until the Operator files additional insurance as provided herein.
1. General Requirements applicable to all policies.
a. The City, its officials, employees, agents and officers shall be endorsed as an
"Additional Insured" to all policies except Employers Liability coverage under the
Operator's Workers Compensation policy.
b. All policies shall be written on an occurrence basis except for Environ�mental
Pollution Liability (Seepage and Pollution coverage) and Excess or Ui'nbrella
Liability, which may be on a claims-made basis.
Page 2
c. All policies shall be written by an insurer with an A-: VIII or better rating by the most
current version of the A. M. Best Key Rating Guide or with such other financially
sound insurance carriers acceptable to the City.
d. Deductibles sha11 be listed on the Certificate of Insurance and shall be on a"per
occurrence" basis unless otherwise stipulated herein.
e. Certificates of Insurance shall be delivered to the City of Fort Worth, Development
Department, 1000 Throckmorton Street, Fort worth, Texas 76102, evidencing all the
required coverages, including endorsements, prior to the issuance of a Gas Weli
Permit.
f. All policies shall be endorsed with a waiver of subrogation providing rights of
recovery in favor of the City.
g. Any failure on part of the City to request required insurance documentation shall not
constitute a waiver af the insurance requirement specified herein.
h. Each policy shall be endorsed to provide the City a minimum thirty-day notice of
cancellation, non-renewal, and/or material change in policy terms or coverage. A ten
days notice shall be acceptable in the event of non-payment of premium.
i. During the term af the Gas Well Permit, the Operator shall report, in a timely manner,
to the Gas Inspector any known loss occurrence which could give rise to a liability
claim or lawsuit or which could result in a property loss.
j. Upon request, certified copies of all insurance policies shall be furnished to the City.
2. Standard Commercial General Liability Policy.
This coverage must include premises, operations, blowout or explosion, products,
completed operations, sudden and accidental pollution, blanket contractual liability,
underground resources damage, broad form property damage, independent contractors
protective liability and personal injury. This coverage shall be a minimum Combined Single
Limit of $1,000,000 per occurrence for Bodily Injury and Property Damage.
�. Excess or Umbrella Liability
$ 5,000,000 Excess, if the Operator has a stand-alone Environmental Pollution
Liability (EPL) policy.
$ l 0,000,00Q Excess, if the Operator does not have a stand-alone EPL policy.
Coverage must include an endorsement for sudden or accidental
pollution. If Seepage and Pollution coverage is written on a"claims
made" basis, the Operator must maintain cantinuous coverage and
purchase Extended Coverage Period Insurance when necessary.
4. Workers Compensation and Employers Liability Insurance
a. Workers Compensation benefits shall be Texas Statutory Limits.
b. Employers Liability shall be a minimum of $500,000 per accident.
c. Such coverage shall include a waiver of subrogation in favor of the City and
provide coverage in accordance with applicable State and Federal laws.
5. Automobile Liability Insurance
a. Combined Single Limit of $1,000,000 per occurrence for Bodily Injury and
Property Damage.
b. Coverage must include ali owned, hired and not-owned automobiles.
Page 3
6. Certificates of Insurance
a. The company must be admitted or approved to do business in the State of Texas,
unless the coverage is written by a Surplus Lines insurer.
b. The insurance set forth by the insurance company must be underwritten on forms
that have been approved by the Texas State Boazd of Insurance or ISO, or an
equivalent policy form acceptable to the City.
c. Sets forth all endorsements and insurance coverage according to requirements and
instructions contained herein.
d. Shall specifically set forth the notice of cancellation, termination, or change in
coverage provisions to the City. All policies shall be endorsed to read "THIS
POLICY WILL NOT BE CANCELLED OR NON-RENEWED WITHOUT 30
DAYS ADVANCED WRITTEN NOTICE TO THE OWNER AND THE. CITY
EXCEPT WHEN THIS POLICY IS BEING CANCELLED FOR NONPAYMENT
OF PREMIUM, IN WHICH CASE 10 DAYS ADVANCE WRITTEN NOTICE IS
REQUIRED".
e. Original endorsements affecting coverage required by this section shall be furnished
with the certificates of insurance.
7. The cancellation of any insurance for the sole purpose of the repair of roadways will not
release the obligation of the Operator to meet all requirements of insurance and bonding
under the Fort Worth "Gas Drilling and Production" Ordinance.
8. Operator shall and hereby does indemnify, defend and save harmless the City, its officers,
agents and employees from all suits, actions or claims of any character, name and
description brought for or on account of any injuries or damages received as sustained by
any person, persons or property on account of the operations of the Operator, its agents,
employees, contractors or subcontractors; or on account of any negligent act of fault of the
Operator, its agents, employees, contractors or subcontractors in connection with the
obligations under this Road Repair Agreement; and shall pay any judgment, with costs,
which may be obtained against the City growing out of such injury or dannage.
ARTICLE 4.
PERFORMANCE BONDS
l. Operator shall provide a performance hond, unless a performance bond has been
provided for the issuance of a Gas Well Permit under the terms and conditions described in Fort
Worth "Gas Drilling and Production" ordinance, in an amount not less than the amount necessary
to repair the roadways, as determined by the City Director of Transportation and Public Works.
2. Prior to the beginning of any activity pursuant to the issuance of a Gas Well Permit,
unless a performance bond has been provided for the issuance of a Gas Well Permit under the
terms and conditions described in the Fort Worth "Gas Drilling and Production" Ordinance,
Operator shall provide the Gas Inspector with a security instrument in the form of a bond or an
irrevocable letter of credit as follows:
Page 4
a. Bond. A bond shall be executed by a reliable bonding or insurance institution
authorized to do business in Texas, acceptable to the City. The bond shall become effective
on or before the date the Gas Well Permit is issued and shall remain in force and effect for
at least a period of six (6) months after the expiration of the Gas Well Permit term or until
the well is plugged and abandoned and the site is restored, whichever occurs first. The
Operator shall be listed as principal and the instrument shall run to the City, as oblig�e, and
shall be conditioned that the Operator will comply with the terms and regulations of this
Ordinance and the City. The original bond shall be submitted to the Dire�tor of
Transportation and Public Works with a copy of the same provided to the City Selcretary
and the Gas Inspector.
b. Letter of Credit. A letter of credit shall be issued by a reliable bank authorized to do
business in Texas and shall become effective on or before the date the Gas Welt Permit is
issued. The letter of credit shall remain in force and effect for at least a period of six (6)
months after the expiration of the Gas Well Permit term. The City shail be authorized to
draw upon such letter of credit to recover any fines or penalties assessed under this
ordinance. Evidence of the execution of a letter of credit shall be submitted to the Director
of Transportation and Public Works submitting an original signed letter of credit from the
banking institution, with a copy of the same provided to the City Secretary and the Gas
Inspector. If the Letter of Credit is for a time period less than the life of the well as required
by Ordinance Number 14880, Devon agrees to either renew the Letter of Credit or
replace the Letter of Credit with a bond in the amount required by the City of Fort Worth
Ordinance Number 14880, on or before 45 days prior to the expiration date of the Letter of
Credit. If Devon fails to deliver to the City of Fort Worth either the renewal Letter
of Credit or replacement bond in the appropriate amount on or before 45 days prior to the
expiration date of the Letter of Credit, the City of Fort Worth may draw the entire face
amount of the attached Letter of Credit to be held by the City of Fort Worth as security for
Devon 's performance of its obligations under Ordinance Number 14880.
c. Whenever the Gas Inspector or the Director of Transportation and Public Works
Department finds that a default has occurred in the performance of any requirement or
condition imposed by this Agreement, a written notice shall be given to Operator. Such
notice shall specify the work to be done, the estimated cost and the period of time deemed
by the Gas Inspector or the Director of Transportation and Public works Department to be
reasonably necessary for the completion of such work. After receipt of such notice, the
Operator shall, within the time therein specified, either cause or require the work to be
per%rrned, or failing to do so, shall pay over to the City one hundred twenty-five percent
(125%) of the estimated cost of doing the work as set forth in the notice.
d. The City shall be authorized to draw against any irrevocable letter of credit or bond
to recover such amount due from Operator. Upon receipt of such monies, the City shall
proceed by such mode as deemed convenient to cause the required work to be performed
and completed, but no liability shall be incurred other than for the expenditure of said sum
in hand..
e. In the event Operator does not cause the work to be performed and fails or re�'uses to
pay over to the City the estimated cost of the work to be done as set forth in the notice, or
Page 5
the issuer of the security instrument refuses to honor any draft by the City against the
applicable inevocable letter of credit or bond the City may proceed to obtain compliance
and abate the default by way of civil action against Operator, or by criminal action against
the Operator, or by both such methods.
f. The cancellation of any bond or letter of credit for the sole purpose of the r�pair of
roadways will not release the obligation of the Operator to meet all requirem�nts of
insurance and bonding under the Fort Worth "Gas Drilling and Production" Ordinanoe. Any
bond required by the Fort Worth "Gas Drilling and Production" Ordinance shall stay in full
force and effect until the terms and conditions set out in the Ordinance are met.
3. If the cost of the completing the repair is an amount of $15,000 or l�ss, as
determined by the Director of Transportation and Public Works, cash in the amount neces�ary to
complete the repairs, as determined by the Director of Transportation and Public Works, �fiay be
deposited with a bank or escrow agent pursuant to an escrow agreement acceptable and approved
by the City ensuring completion of the repair.
ARTICLE 5
MISCELLANEOUS PROVISIONS
1. Operator understands and agrees that Operator, its employees, servants, agents, and
representatives shall at no time represent themselves to be employees, servants, agents, and/or
representatives of the City. The City shall not have any control over the means or methods by
which Operator shall perform its obligations hereunder. Operator shall furnish all equipment and
materials necessary to perform hereunder and shall at all times be acting as an independent
Operator.
2. By entering into this Agreement, the City does not waive, nor shall it be deemed to
waive, any immunity or defense that would otherwise be available to it against claims arising by
third parties.
3. This Agreement represents the entire agreement between 4perator and City for
repair of roadways and supersedes all prior negotiations, representations, and/or agreements, either
written or oral. This Agreement may be amended only by written instrument signed by the
governing body of the City or those authorized to sign on behalf of the City's governing body.
ARTICLE 6.
FORCE MAJEURE
Events of Force Majeure shall mean any contingency or cause beyond the reasonable
control of a party including, without limitation, acts of God or the public enemy, war, riot, civil
commotion, insurrection, government or de factu government action (unless caused by acts or
omissions of the party), fires, explosions, rain or other weather delays, floods, strikes, slowdowns
or work stoppages.
Page 6
ARTICLE 7.
ASSIGNABILITY/CONSENT
Except as otherwise provided herein, or except as may be hereafter determined by the
parties, no party to this Agreement may sell, assign, or transfer its interest in this Agreement, or any
of its right, duties, or obligations hereunder, without the prior written consent of the othe� party.
Whenever the consent or the approval of a party is required herein, such party shall not
unreasonably withhold, delay, or deny such consent or approval. Operator may assign this
Agreement to any successor entity to whom the applicable Gas Well Permit has been assigned upon
written notice to the City of said assignment.
ARTICLE 8.
NOTICE
Any notice given by one party to the other in connection with this Agreement shall be in
writing and shall be by personal delivery; sent by registered mail or certified mail; or by United
States Mail, retutn receipt requested, posta.ge prepaid; to:
CITY: Office of the City Manager
City of Fort Worth, Texas
1000 Throckmorton Street
Fort Worth, Texas 76102
OPERATOR Devon Energy Corporation
20 North Broadway
Oklahoma City, Oklahoma 73102-8260
with copy to:
Devon Energy Production Company, L.P.
408 Park West Court (Post Office Box 450)
Decatur, Texas 76234
Notice shall be deemed to have been received on the date of receipt as shown on the return receipt
or other written evidence of receipt.
ARTICLE 9.
MODIFICATION
No waiver or modification of this Agreement or of any covenant, condition, limitation
herein contained shall be valid unless in writing and duly executed by the party to be charged
therewith. No evidence of any waiver or modification shall be offered or received in evidence in
any proceeding arising between the parties hereto out of or affecting this Agreement, or the rights
or obligations of the parties hereunder, unless such waiver or modification is in writing, duly
executed. The parties further agree that the provisions of this Article will not be waived unless as
herein set forth.
ARTICLE 10.
SAV INGS/SEVERABILITY
In the event that any one or more of the provisions hereof contained in this Agreeme�t shall
for any reason be held to be invalid, illegal, or unenforceable in any respect, such inv�lidity,
illegality, or unenforceability shall not effect the other provisions, and the Agreement shall b�
Page 7
construed as if such invalid, illegal, or unenforceable provision had never been contained in
this Agreement.
ARTICLE 11.
GOVERNING LAW AND VENUE
This Agreement shall be construed under and governed by, and in accordance with the laws of the
State of Texas, and venue for any action azising under the terms and conditions of this Agreement
shall lie in the state courts located in Tarrant County, Texas or the United States District Court for
the Northern District of Texas, Fort Worth Division.
ARTICLE 12.
ENTIRE AGREEMENT
This Agreement and the exhibits attached hereto, constitute the entire agreement ampng the
parties hereto with respect to the subject matter hereof, and supersede any prior understandings or
written or oral agreements between the parties with respect to the subject matter of this Agreement.
No amendment, modification, cancellation or alteration of the terms of this Agreement shall be
binding on any party hereto unless the same is in writing, dated subsequent to the date hereof, and
is duly authorized and executed by the parties hereto.
ARTICLE 13.
WAIVER OF TERMS AND CONDITIONS
The failure of either party to enforce or insist upon compliance with any of the terms or
conditions of this Agreement shall not constitute a general waiver or relinquishment of any such
terms or conditions, but the same shall be and remain at all times in full force and effect.
ARTICLE l4.
CAPTIONS
The captions contained in this Agreement are for informational purposes oniy and shall not
in any way affect the substantive terms or conditions of this Agreement.
ARTICLE 15.
COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original, and constitute one and the same instrument.
Page 8
IN WITNESS WH REOF, the arties do hereby affix their signahues and enter into this
Agreement as of the % � day of 20 �c� .
ATTEST:
' �� � �� �
,
u �►,.
�'
- ��,
APPROVED AS TO FORM
AI�ID LEGALITY:
David Yett, City Attorney
__ ,
,^ %
�. + � i.
gy� ✓ � ` j ���`�����L�/��
't ��
/
STATE OF TEXAS &
COUNTY OF TARRANT
CITY OF FORT WORTH
By: � . e�o
harles Boswell, City Manager
, L.P.
Bradley A. Foster, Vice-President
Before me, the undersigned notary public, on this day personally appeared Charles Boswell,
the City Manager of the City of Fort Worth, Texas, known to me to be the person whose name is
subscribed to the foregoing instrument, and acknowledged to me that he/she executed the
instrument for the purposes and consideration therein expressed.
_;,;,
- - ��,.
Given under m}�i��hd and s��i�;b�office this ', day of ;,"- , 20 �
;�: ; - :_
= 2 �:;��;:,-`' � = i _s'
: �nT � '=� +Q _ _ �Y � �;S t .�
% °. �'� , ; - � " f �-__
�;; � RtiS..�� � Notary Public
�-;; ; . .
,, � _�2 0 ,��,
;, �,�;, c ,, .
STATE OF OKLAHOI�'A�,,;���,,�,,,.,,,,""' §
GOUNTYOF OKLAHOMA §
Before me, the undersigned authority, a Notary Public in and for the State of 1'e-�as, on this
day personally appeared � -- , known to me to be the person
whose name is subscribed to the foregoing instrument, and acknowledged to me that the same was
the act of - •(the corporation) and that he executed the same
as the act of said - � . , � � , � � - � (corporation) for the purposes and
consideration therein expressed and in the capacity therein stated.
Given under my hand and seal of office this -� day of , 20 ;`.
-------- ------------
� ,�p�A��.. MARSHA BARTLETT �
�: sEA� Oklahoma County �
;°:: ,., . Notary Public in znd for ;
; 'A�B��G` State of OVdahoma ;
� Commission # 02012697_ Expirgs 8/9/O6 �
Notary Public
Page 9
BLANKET DRILLING BOND
Bond No. 71 S 100753026-328
KNOW ALL MEN BY THESE PRESENTS:
That we, Devon Energy Operating Company, L.P. as Principal, and the Travelers Casualty and Surety
Company of America a corporation created, organized and existing under and by virtue of the laws of the
State of Connecticut, and duly licensed to transact a general Surety business, in the State of Texas, as
Surety are held and firmly bound to City of Fort Worth, Texas in the sum of One Hundred Fifty Thousand
Dollars and 00/l00 Dollars ($150,000.00) lawful money of the United States of America, to be paid to the
said City of Fort Worth, Texas for which payment, well and truly to be made, we bind ourselves, our heirs,
executors and successors, jointly and severally, fumly by these presents.
THE CONDITION OF THE ABOVE OBLIGATION IS SUCH, That
Whereas the principal has been granted a perznit to dtiil muItiple wells within the city limits of
Fort Worth, Texas.
Now therefore, the condition of this obligation is such.that if the principal shaIl faithfully compty
with all conditions of the City of Fort Worth Ordinance when drilling said wells then this
obligation to be void otherwise to remain in fu11 force and effect.
Provided further, that regardless of the number of years this bond shall continue or be conCinued in force
and of the number of premiums that shall be payable or paid, the Surety shall not be liable hereunder for a
larger amount in the aggregate, than the amount stated herein.
Provided further, that if the Surety shaIl so elect this bond may be cancelled by the Surety as to subsequent
�liability by giving thirty (30) days notice in writing to paid obligee.
SIGNED, SEALED AND DATED THIS 2nd DAY OF December, 2003.
WITNESS: v`—`—� ���
DEVON ENER Y OPERA.TING COMPANY, L.P.
By: �
Countersigned By:
Mrrr�% `
exas Res' ent Agent
TRAVELERS CASUALTY AND SURETY
CO NY OF AME
By:
Patsy A. ne, Atto -in-Fact �
'
Devon Energy Production Company, L.P.
408 Park West Ct. - P.O. Box 450
Decatur, Texas 76234
Tuesday, March 29, 2005
David Lunsford
Gas Well Inspector
1000 Throckmorton Street
Fort Worth, Texas 76102
Re: Road Repair Agreenzent
Old Denton Road
Rethia Seybold Lease/LTnit
Tarrant County, Texas
Mr. Lunsford:
Enclosed is a Road Repair Agreement ("Agreement"), covering the above referenced road and well,
which has been executed by Devon Energy Production Company, L.P. ("Devon"). In accordance
with said Agreement, also enclosed is the videotape of the current road condition of Old Denton
Road. Devon plans to use a portion of these city maintained roadways during the drilling and
completing of the Rethia Seybold #2H.
Devon submitted changes to the Agreement in an effort to clarify the intent of said Agreement. The
City of Fort Worth ("City") declined to accept any of the changes based on the fact that other Oil
and Gas Companies had signed the Agreement without change.
Devon's attorney has spoken with Sarah Fullenwieder to get a clarification of what time period
Devon would be responsible for road repairs. She has stated that the City's intent is that Devon
would be responsible for road repairs for activity during the drilling and completion operations for
the well covered by the Agreement. Devon will proceed under that understanding. Therefore, the
term of this Agreement shall be from the onset of drilling activities though the cessation of
completion activities for Rethia Seybold #ZH . The videotape included with this agreement shall
serve as documentation of the current road condition. Another videotape will be provided to the
City to document road conditions at the end of completion activities.
We appreciate your assistance with the permitting process. Please contact me at 940.627.3041
(extension 250) if you have any questions.
Regards,
DEVON ENERGY PRODUCTION COMPANY� L.P.
�
� ��F��_ N--
� `, i
r"�. .,�• _�-=m
�
�'.
Gilbert`A. Horton
Petroleum Landman