HomeMy WebLinkAboutContract 33837 CITY SECRET,'J9y
CONTRACT NO.
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL
PERSON, YOU MAY REMOVE OR STRIKE ANY OF THE FOLLOWING
INFORMATION FROM THIS INSTRUMENT BEFORE IT IS FILED FOR RECORD IN
THE PUBLIC RECORDS: YOUR SOCIAL SECURITY NUMBER OR YOUR
DRIVER'S LICENSE NUMBER.
UNIT DESIGNATION AND AGREEMENT
DALE OPERATING COMPANY DUCK HEAD GAS UNIT
STATE OF TEXAS §
COUNTY OF TARRANT §
WHEREAS,Dale Resources,L.L.C. and Endeavor Energy Resources, L.P.,(hereinafter
collectively called"Lease Owner")are the present owners and holders of the oil,gas and mineral
leases,together with any and all corrections and amendments thereto,identified and described on
Exhibit"A" attached hereto and made a part hereof(as so corrected and amended, collectively
"Said Leases" or individually "Said Lease"), insofar as Said Leases cover the lands and depths
included within the hereinafter described unit;and
WHEREAS, each of Said Leases provide that the Lease Owner shall have the right and
power to designate, pool or combine, as to the gas and condensate therein and thereunder, the
lands covered thereby,or portions thereof,with other land,lease or leases in the vicinity thereof,
in order to form a gas unit or units,provided that the Lease Owner shall execute an instrument in
writing identifying and describing such lands;and
WHEREAS, certain of Said Leases provide that the formation of such unit or units is
subject to the prior written consent of Lessors of Said Leases;
WHEREAS, in the judgment of Lease Owner,it is necessary and advisable to designate
Said Leases and to pool and combine Said Leases as to said lands and depths in order to properly
develop and operate the premises for the production of gas, and in order to promote the
conservation of gas in,under and that may be produced therefrom;and
WHEREAS, the undersigned Lessors of Said Leases (collectively "Lessors" or
individually "Lessor") desire to execute this Unit Designation and Agreement ("this
Agreement") consenting to the formation of such unit and the pooling and combination of said
lands and depths and agreeing to the terms and provisions set forth herein;
NOW,THEREFORE,the Lease Owner and the Lessors do hereby designate,pool and
combine Said Leases into a unit designated as the Duck Head Gas Unit, containing 295.8 acres,
more or less,("this Unit")being,and including,all of the lands described in Exhibit"B"attached
hereto and made a part hereof,insofar and only insofar as said lands cover those depths from 100
feet above the top of the Barnett Shale formation which occurs at a stratigraphic equivalent of a
log depth of 7030 feet, down to and including the base of the Barnett Shale formation which
occurs at the stratigraphic equivalent of a log depth of 7374 feet as shown on that certain Array
Induction SP Log dated March 21,2005 from the Dale Operating Company,Brentwood Well 41
located 195 FNL and 404 FWL of the J. Blackwell Survey A-148 (API NO. 42-439-30916),
Tarrant County,Texas, a portion of which log is reproduced in Exhibit"C"attached hereto and
made a part hereof, for the purpose of developing and operating said lands and depths and said
leases for the production, storage,processing,and marketing of gas and condensate and gas and
condensate rights. It is the intent to designate and pool all leases and lands owned by Lease
Owner, insofar as, the same cover said lands and depths, regardless of whether said leases are
listed on Exhibit"A,"and said leases and any corrections thereof or amendments thereto,and the
term"Said Leases,"as used herein,shall be deemed to include said leases.
This Agreement shall not exhaust the rights of Lease Owner, its successors and assigns,
to form any other unit(s)covering Said Leases,or any portions thereof,or covering any depths or
production formation not affected herein and which may underlie the unit.
�s
For the purpose of calculating gas royalty payable under Said Leases, there shall be
allocated to each tract committed to and covered by this Unit as to said depths that prorata
portion of the gas and condensate so produced from this Unit which the number of surface acres
covered by the tract bears to the total number of surface acres included in this Unit.
Notwithstanding anything to the contrary contained herein or in Said Leases, if, at any
time or from time to time,any of Said Leases terminate,either in its entirety or in part as to any
lands or depths, or the Lease Owner is required by the terms of Said Lease to release all or a
portion of the lands or depths covered thereby,then the lands or depths as to which Said Lease so
terminated or which were so released shall be automatically released from,and shall no longer be
included in or covered by this Unit. In such event, gas and condensate shall thereafter be
allocated hereunder only to those lands and depths which remain in this Unit after giving effect
to the preceding sentence (the "Remaining Premises"). In such event, the Lease Owner is
hereby given the power and authority to file in the Real Property Records of the county in which
such lands are located a recordable instrument amending this Unit to designate and describe the
Remaining Premises and/or the Lands or Depths so released from this Unit.
Lease Owner agrees that it will not modify this Agreement without the prior written
approval of the undersigned Lessors.
Notwithstanding anything to the contrary contained herein,this Unit may be dissolved by
the Lease Owner, its successors or assigns, by instrument filed for record in the appropriate
records of Tarrant County,Texas,at any time after the cessation of production on,or attributable
to,this Unit.
Lessors hereby consent, ratify and adopt this Unit and the terms of this Agreement and
hereby agree that this Unit is validly formed and designated and shall be treated as a pooled unit
for the purposes of Said Leases, notwithstanding anything contained in Said Leases to the
contrary. To the extent that the size, configuration or composition of this Unit, or any of the
terms of this Agreement,conflicts,or is inconsistent with any of the terms of any Said Lease,this
Agreement, and the size, configuration and composition of this Unit and the terms of this
Agreement shall prevail and control,and Said Leases shall deemed to be amended hereby.
This Agreement may be executed in multiple counterparts, each of which when so
executed shall be deemed an original and all of which shall constitute one and the same Agreement.
Each of the undersigned agree that for recording purposes, their respective signature pages and
acknowledgments may be removed from their respective counterpart, and attached to a single
counterpart of this Agreement.
IN WITNESS WHEREOF, this Agreement has been executed as of the date of the
acknowledgements below but made effective as of the 11`x'day of July,2006.
LEASE OWNER:
DALE RESOURCES,L.L.C.
Ann F.Vandenberg
Vice President
ACKNOWLEDGMENT
STATE OF TEXAS
COUNTY OF ',')a Lt0,6
This instrument was acknowledged before me on I—VW,
2006 by Ann F.Vandenberg,Vice-President of Dale Resources,L.L.C., a Texas-limited liability
company,on behalf of said company.
[SEAL]
Nh4y Public,State of Texas
�:..y w JOHN NEWMAN
Notary Public,state of Texas
til i My Commission Expires
.it•r� September 10,2006
LEASE OWNER:
ENDEAVOR ENERGY RESOURCES,
L.P.
By:
Title: beA.
ACKNOWLEDGMENT
STATE OF TEXAS
COUNTY OF Y l i IX► �
This in trument was acknawledved before me on au,Ly
2006 by , tTltle),of EndeavorrEEnergy Resources,
L.P.,a partnership,on behalf of said partnership.
[SEAL]
- --- --- - - - - - - -
e NCTRRY Pl1BLIO Notary Public,State of Texas
STATE OF TEXAS
"'4 ov E`er My Comm.'cxphs 07-LI
LESSOR:
CITY OF FORT WORTH
By: fn ,
Its: Marc A.ot,,
M.IStant pj,�
'Y Vidnager
ATTEST L-Al
Contract A'thorizatjon
City S4cretary-)
Date
APPROVED AS TO FORM AND LEGALITY:
E�
Assistant City, ttorney
STATE OF TEXAS
COUNTY OF rgZr—
This instrument was acknowledged before me on
2006 by ',Wa,%e-A. for the City of Fort
Worth,Texas.
[SEAL]
Notary Public,State of Texas
LESSOR:
RIVERBEND INVESTMENT,LTD.
By: RBE Investment Corp.,General Partner
By:
Title:
STATE OF TEXAS
COUNTY OF
This instrument was acknowledged before me on the day of
, 2006, by (Name), (Title) of
RBE Investment Corp., General Partner of Riverbend Investment, Ltd., a limited
partnership,on behalf of said partnership.
[SEAL]
Notary Public,State of Texas
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EXHIBIT`B"
DUCKHEAD GAS UNIT
BEING a tract of land situated in the W. Morris Survey Abstract No. 1053,the J.C.Davis Survey,
Abstract No. 423, the Wm. Masters Survey, Abstract No. 1048, and the John Sansom Survey,
Abstract No. 1387 in the City of Fort Worth,Tarrant County,Texas,and being a part or all of those
tracts of land described in deeds to West Fork Partners,L.P.,recorded in Doc.No.D200158485,to
Squaretop Partners,recorded in Doc.No.D200045357,to Michael McGuffin,recorded in Doc.No.
D204195651, to Mallard Cove, L.P., recorded in Doc. No. D201167101, the City of Fort Worth,
recorded in Doc. No. D203060189, and to Riverbend Investments, Ltd., recorded in Volume
13681, Page 387, all Deed Records of Tarrant County, Texas, and being more particularly
described by metes and bounds as follows:
BEGINNING at a 1/2 inch iron rod found in the southwest comer of said McGuffin tract and
southeast comer of said Mallard Cove,L.P.tract,said point being on the north right-of-way line of
Randol Mill Road(variable width right-of-way);
THENCE North 00 degrees 28 minutes 50 seconds West, departing said north right-of-way line
and along the west line of said McGuffin Tract and the east line of the corrected plat of Mallard
Cove an addition to the City of Fort Worth, recorded in Doc. No. D202363429, a distance of
1,191.46 feet to a point for corner;
THENCE South 89 degrees 26 minutes 11 seconds West, departing said west line and along the
north line of said Mallard Cove addition,a distance of 111.76 feet to a point for corner;
THENCE North 00 degrees 33 minutes 49 seconds West, continuing along said north line, a
distance of 25.00 feet to a point for corner;
THENCE South 89 degrees 26 minutes I I seconds West, continuing along said north line, a
distance of 772.00 feet to a point for corner;
THENCE South 00 degrees 33 minutes 49 seconds East, continuing along said north line, a
distance of 30.00 feet to a point for corner;
THENCE South 89 degrees 26 minutes 11 seconds West, continuing along said north line, a
distance of 110.00 feet to the northwest corner of said addition and being on the west line of said
Mallard Cove,L.P.tract;
THENCE North 00 degrees 33 minutes 49 seconds West,along said west line,a distance of 852.20
feet to a 1/2 inch iron rod found for corner, said point being on the south line of said City of Fort
Worth tract;
THENCE North 89 degrees 51 minutes 39 seconds West, along said south line, a distance of
271.18 feet to a 5/8 inch iron rod found for corner;
THENCE North 01 degree 15 minutes 24 seconds West, along the west line of said City of Fort
Worth tract,a distance of 1,067.51 feet to a 5/8 inch iron rod found for corner;
THENCE South 88 degrees 44 minutes 36 seconds West, continuing along said west line, a
distance of 379.93 feet to a point for corner;
THENCE North 48 degrees 22 minutes 12 seconds East,continuing along said west line,a distance
of 325.64 feet to a point for corner, said point being on the northerly south line of said West Fork
Partners,L.P.tract;
THENCE North 70 degrees 57 minutes 12 seconds West,along said south line,a distance of 46.99
feet to a point for corner on the south bank of the West Fork of the Trinity River;
THENCE along said south bank the following calls:
North 48 degrees 55 minutes 19 seconds East,a distance of 238.76 feet to a point for comer;
North 21 degrees 33 minutes 38 seconds East,a distance of 188.75 feet to a point for corner;
North 10 degrees 43 minutes 20 seconds East,a distance of 204.65 feet to a point for corner;
North 04 degrees 08 minutes 11 seconds West,a distance of 221.28 feet to a point for corner;
North 26 degrees 02 minutes 29 seconds West,a distance of 15 1.10 feet to a point for corner;
North 43 degrees 47 minutes 16 seconds West,a distance of 225.90 feet to a point for corner;
North 68 degrees 27 minutes 40 seconds West,a distance of 287.62 feet to a point for corner;
North 84 degrees 02 minutes 50 seconds West,a distance of 372.12 feet to a point for corner;
North 16 degrees 42 minutes 50 seconds West,a distance of 135.48 feet to a point for corner;
North 68 degrees 39 minutes 18 seconds East,a distance of 396.64 feet to a point for comer;
North 19 degrees 38 minutes 23 seconds East,a distance of 257.40 feet to a point for comer;
North 38 degrees 07 minutes 10 seconds East,a distance of 143.54 feet to a point for comer;
North 84 degrees 50 minutes 38 seconds East,a distance of 111.08 feet to a point for corner;
THENCE North 73 degrees 14 minutes 52 seconds East, departing said south bank, a distance of
174.32 feet to a point for corner in the centerline of said West Fork of the Trinity River;
THENCE South 50 degrees 17 minutes 00 seconds East,along said centerline,a distance of 494.03
feet to a point for corner on the south line of said Riverbend Investments,Ltd.tract;
THENCE North 89 degrees 34 minutes 33 seconds East,departing said centerline of the West Fork
and along said south line,a distance of 243.23 feet to a point for corner;
THENCE South 32 degrees 53 minutes 26 seconds West, continuing along said south line, a
distance of 142.58 feet to a point for corner;
THENCE South 54 degrees 34 minutes 33 seconds East, departing said south line, and over and
across said Riverbend Investments tract, said West Fork of the Trinity River and said West Fork
Partners,L.P.tract, a distance of 2,493.15 feet to a point for corner of the north bank of said West
Fork of the Trinity River;
THENCE North 87 degrees 54 minutes 44 seconds East, along said north bank, a distance of
435.19 feet to a point for corner;
THENCE South 01 degree 56 minutes 20 seconds East, departing said north bank, a distance of
104.98 feet to a point for corner in the centerline of said West Fork of the Trinity River;
THENCE North 80 degrees 29 minutes 29 seconds East,along said centerline,a distance of 288.27
feet to a point for corner:
THENCE South 77 degrees 50 minutes 56 seconds East, continuing along said centerline, a
distance of 331.14 feet to a point for corner;
THENCE South 00 degrees 30 minutes 26 seconds East, departing said centerline, passing at a
calculated distance of 78.03 feet the northeast corner of said West Fork Partners, L.P.tract on the
south bank of said West Fork, and continuing along the west line of said West Fork Partners, L.P.
and Squaretop Partners tracts, in all a total distance of 3,358.10 feet to a point for corner on said
north line of Randol Mill Road;
THENCE Westerly along said north line the following calls:
2
North 77 degrees 14 minutes 18 seconds West,a distance of 127.18 feet to a point for corner;
North 72 degrees 51 minutes 51 seconds West a distance of 1,236.18 feet to a point on a
circular curve to the left with a radius of 509.11 feet and a chord bearing North 89 degrees 34
minutes 38 seconds West,a distance of 292.82 feet;
Westerly along said curve to the left, through a central angle of 33 degrees 25 minutes 33
seconds,an arc distance of 297.01 feet to a point for corner;
South 73 degrees 42 minutes 34 seconds West,a distance of 33.15 feet to a point on a circular
curve to the left with a radius of 773.95 feet and a chord bearing South 68 degrees 24 minutes
00 seconds West,a distance of 143.23 feet;
Westerly along said curve to the left, through a central angle of 10 degrees 37 minutes 08
seconds,an are distance of 143.44 feet to a point for corner;
South 63 degrees 05 minutes 24 seconds West,a distance of 189.80 feet to the beginning of a
non-tangent circular curve to the right with a radius of 856.04 feet and a chord bearing South 76
degrees 07 minutes 38 seconds West,a distance of 440.91 feet;
Westerly along said curve to the right, through a central angle of 29 degrees 50 minutes 50
seconds, an arc distance of 445.94 feet to the POINT OF BEGINNING AND CONTAINING
12,880,711 square feet or 295.8 acres of land,more or less.
Basis of bearing is Texas State Plane Coordinate System, 1983 (1993), Central Zone 4202, based
upon GPS Measurements from triangulation station "Arlington RRP" National Geodetic Survey
(NGS)PID*AF9536 and"ZFW A"NGS PID *AA3134. Convergence angle at"Arlington RRP"
is+00 degrees 47 minutes 06.8 seconds as computed by Corpscon V4.11 Combined Scale Factor
(CFS)=1.00014166230,Surface Coordinates=Texas State Plane Coordinate X CSF.
Schlumberger
Date Operatlrrq Company,Inc.
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 11/29/2005
DATE: Tuesday, November 29, 2005
LOG NAME: 30MALLARDCOVE REFERENCE NO.: **C-21160
SUBJECT:
Approve Acceptance of Lease Agreement with Dale Resources, L.L.C. for Natural Gas Drilling
under 33.5 Mineral Acres, More or Less, of City-Owned Properties Located in Tarrant County,
Texas, Known as Mallard Cove Park
9
RECOMMENDATION:
It is recommended that the City Council approve the acceptance of a lease agreement for natural gas
drilling under 33.5 mineral acres, more or less, of city-owned properties located in Tarrant County known as
Mallard Cove Park with Dale Resources, LLC, for a two-year term.
DISCUSSION:
On September 6, 2005 (via M&C L-14129), City Council authorized the City Manager to convert the
dedicated parkland for subsurface drilling and extraction of natural gas in Mallard Cove Park.
On September 27, 2005 (via M&C G-14933), City Council authorized City staff to reject bids received prior
to park conversion and re-advertise a request for proposals from private companies to drill for natural gas
under city-owned property known as Mallard Cove Park. Mallard Cove Park lies along Randol Mill Road
east of 820 and is further described in Exhibit "A" (see Attachment). The total available acreage in Mallard
Cove Park is 103.9 acres with a 33.5 net mineral acre interest owned by the City of Fort Worth.
A Request for Bid proposals (RFP) was advertised for three consecutive weeks in the Commercial
Recorder published on October 6, 13 and 20, 2005.
The following sealed bid for the gas lease was received and opened on October 27, 2005.
Bidder Lease Bonus/Acre Total Lease Bonus % Royalty
Dale Resources, LLC $1,510.00 $50,585.00 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 $48,055.75, more or less.
It is anticipated that the lease bonus and royalty proceeds will be distributed according to the policy
Logname: 60SOUTHWEST Pagel of 2
adopted by City Council for gas revenues generated on park property.
The property is located in COUNCIL DISTRICT 4, Mapsco 66 G, L.
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
C188 446100 080188900030 $48,055.75
Submitted for City Manager's Office bk Marc Ott (8476)
Originating Department Head: A. Douglas Rademaker (6157)
Additional Information Contact: A. Douglas Rademaker (6157)
Logname: 60SOUTHWEST Page 2 of 2