HomeMy WebLinkAboutContract 36721 (2) CITY SECRETARY�y,,����77�
CONTRACT NO. ��I
NOTICE OF CONFIDENTIALITY RIGHTS: IF YOU ARE A NATURAL PERSON,
YOU MAY REMOVE OR STRIKE ANY OR ALL OF THE FOLLOWING
INFORMATION FROM ANY INSTRUMENT THAT TRANSFERS AN INTEREST IN
REAL PROPERTY BEFORE IT IS FILED FOR RECORD IN THE PUBLIC RECORDS:
YOUR SOCIAL SECURITY NUMBER OR YOUR DRIVER'S LICENSE NUMBER.
MEMORANDUM OF OIL AND GAS LEASE AND SURFACE USE AGREEMENT
THE STATE OF TEXAS §
COUNTY OF TARRANT §
THIS MEMORANDUM OF OIL AND GAS LEASE AND SURFACE USE AGREEMENT
("Memorandum") is made and entered into as of the date herein specified by and between CITY OF
FORT WORTH, a home rule municipal corporation of the State of Texas located within Tarrant,
Denton, and Wise Counties, Texas, (hereinafter referred to as "Lessor"), whose address is 1000
Throckmorton Street, Fort Worth, Texas 76102, and XTO Energy Inc., (hereinafter referred to as
"Lessee"),whose address is 810 Houston Street,Fort Worth,Texas 76102.
WITNESSETH:
WHEREAS, Lessor and Lessee executed an Oil and Gas Lease (the "Lease") effective as the
later of(i)the date of the notarial acknowledgment of the Lessor's execution,or(ii)the approval
of the Lease by the FAA,whereby:
(a) Lessor has granted, leased, and let exclusively unto Lessee for the sole purpose of
investigating, exploring, drilling, operating, and producing oil and/or gas from the land leased
thereunder, together with any liquid or gaseous substances produced in association with oil and
gas,the following described land situated in the City of Fort Worth, Texas described in Exhibit
"A"attached hereto(the "leased premises"),subject to the other provisions therein contained, for
a term of one (1)year from the later of(i)the date of the notarial acknowledgment of Lessor's
execution of the Lease,or(ii)the approval of this Lease by the FAA(hereinafter called"primary
term") and so long thereafter as oil, gas or other minerals granted therein are produced from the
leased premises or lands pooled therewith, in paying quantities, or operations are in progress
thereon as therein provided,and the royalties are paid as provided therein.
(b) Exhibit"B" attached to and made a part of the Lease contains surface provisions
and operations restrictions as therein provided and a Site Survey attached to Exhibit "B"
indicating the wells sites, fracture pit location and well access roads which may be installed and
used by the Lessee.
(c) In Article 1.13 of Exhibit`B"of the Lease, Lessor has granted to Lessee the right
to drill,operate and produce one or more directional or horizontal wells with surface locations on
the Operations Sites as defined in Exhibit "B" of the Lease, to other lands not covered by the
Lease and not pooled with any lands covered by the Lease, in order to produce or develop
minerals not covered by the Lease or lands pooled therewith("Off-Site Wells"). In connection
therewith, Lessor granted unto Lessee, its successors and assigns, a surface and subsurface
easement and right-of-way to provide Lessee ingress to and egress from,and the right to use and
occupy, the surface of the Operations Sites for Off-Site Wells subject to Paragraph Nos. 12, 13
(provided that Lessee's right to remove all property and fixtures associated with rights granted
under article I.13 shall occur within six months after the expiration of the Lease or six months
after the expiration of the rights granted under this Article 1.13,whichever is later), 14, 15, 16,
17, 19,20 and 21 of the Lease, and a non-exclusive subsurface easement for a well bore or well
bores to drill across, through and under the Operations Sites and leased premises. Lessor has
reserved unto itself and its successors and assigns the right to utilize, and the right to grant third
parties the right to utilize, similar subsurface easement rights as therein granted to Lessee,
provided the utilization of any such rights by Lessor and its successors, assigns and third party
grantees shall not interfere with Lessee's exercise and safe operation of its rights as therein
provided. Lessee's easement and right-of-way granted therein shall include the ri t to use all
roads now or hereafter located on the leased premises that will allow Lessee ingress 01,
�,
from the Operations Sites for all surface and subsurface operations as may be e � iv �
03-07- �N
desirable for the operation and production of the Off-Site Wells, including, without limitation,
drilling, testing, equipping, producing, completing, operating, deepening, reworking, plugging
back,laying pipelines,plugging and abandoning,and performing all other associated surface and
subsurface operations.
If the Lease terminates as to the leased premises, or any portion, thereof, the surface and
subsurface easement and right-of-way granted to Lessee shall, nevertheless, survive such
termination, and Lessee shall continue to have the right to use the Operations Sites and
subsurface of the leased premises to drill, test, equip, produce, complete, operate, deepen,
rework,plug back, lay pipelines,plug and abandon,and perform all other associated surface and
subsurface operations as may be necessary or desirable for the operation and production of the
Off-Site Wells, for so long as Lessee produces oil or gas from the Off-Site Wells or maintains a
lease on which an Off-Site Well has been drilled by payment of shut-in royalties, operations or
as otherwise provided therein, and Lessee shall continue to have the right of ingress and egress
over,under and across the leased premises to the Operations Sites for the above-stated purposes.
WHEREAS, it is the desire of the undersigned parties to give public notice of the
existence of the Lease.
NOW, THEREFORE, for$10.00 and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Lessor and Lessee hereby acknowledge the
execution and delivery of the Lease. This Memorandum shall not be deemed to enlarge,restrict
or change the rights of any party to the Lease, but is for the purpose of giving record notice of
the existence of the Lease. In the event of any inconsistency between the terms of the Lease and
any provision of this Memorandum,the Lease will control.
EXECUTED AND EFFECTIVE as of the later of(i)the date of the notarial acknowledgment
of the Lessor's execution,or(ii)the approval of this Lease by the FAA.
LESSOR:
CITY OF FORT WORTH
I C.L_
Fernando Costa,Acting
Assistant City Manager
ATI -- -- --- Contra t Au horizetion�
City Secretary Date
APPROVED AS TO FORM AND LEGALITY:
Assistant City ttorney
Date: 3—
LESSEE:
XTO ENERGY INC.
Edwin S.Ryan,Jr.
Senior Vice President—Land Administration
Date: Z�Z7A 8
2I ��dP1
THE STATE OF TEXAS §
COUNTY OF I a tt cz § ]]��--��
BEFORE ME,the undersigned,a Notary Public,on this day personally appeared .1A6 LGCCLIEr Assistant City
Manager for City of Fort Worth,known to me to be the person whose name is subscribed to the foregoing instrument and cknowledged,that
(s)he has executed the same for the purposes and consideration therein express.
GIVEI UND R MY HAND AND SEAL OF OFFICE this day ofCk L1 Y�L 2008.
[SEAL]
Notary Public in and for the
State of Texas
My Commission Expires:
Print Name of Notary Public Here
.r■
HETTIE LANE
i x MYOOMMISSIONkKPIREB
THE STATE OF TEXAS I - §
COUNTY OF lQy�O�YIT §
BEFORE ME,the undersigned,a Notary Public,on this day personally appeared Edwin S.Ryan,Jr,Senior Vice President-Land
Administration of XTO Energy Inc.,a Delaware corporation,known to me to be the person whose name is subscribed to the foregoing instrument
and acknowledged,that(s)be has executed the same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this-;aL day of_ ��.r� ,2008.
[SEAL] / ,n j � � ,
�It'•t\1E/�M y"`�'4otary Public in and for the
State of Texas
My Commission Expires:
Print Name of Notary Public Here
LCARLA J.DANcELS, Pb14rY�srsrE OF sexasxpumm.e.c•OBft<I2077
3
EXHIBIT"A"
Attached hereto and made a part here f that certain Memorandum of Oil and Gas Lease and
Surface Use Agreement dated ,2008,by and between the City of Forth
Worth,as Lessor and XTO Energy Inc.,as Lessee,to-wit:
819.6993 acres,more or less,described below as Parcel One through Parcel Seven,to-wit:
Parcel One:
760.319 acres,more or less more particularly described as:
798.00 acres, more or less, described as Meacham Airport, an Addition to the City of Fort
Worth, Tarrant County, Texas, according to Plats recorded as Plat A, Slide 2445 through Slide
2447,Plat Records of Tarrant County, Texas,and being out of the A.F.Albright Survey,A-1849,
the L. Cohen Survey, A-297 the John H. Duncan Survey,A-397, the W.M. Gray Survey, A-635,
the Thomas Hicks Survey, A-1820, the Rush Loyd Survey,A-986, the Robert Musselman Survey,
A-1102, the Phillip Nicholas Survey, A-1175, the Charles H. Putnam Survey, A-1250, the John
Ringer Survey,A-1939,the S.A. &M.G.R.R. Company Survey,A-1464, the Thomas J. Thompson
Survey,A-1503, and the James Wallace Survey,A-1605, Tarrant County,Texas
LESS, SAVE AND EXCEPT: 37.681 acres, more or less, being all that part
and only that part of the following:
1.584 acres, more or less, out of the C. H. Putnam Survey, A-1250, Tarrant County,
Texas, and being the same land described in Right of Way Deed dated October 10, 1941,
from Trinity Portland Cement Company to State of Texas, recorded in Volume 1496,
Page 45,Deed Records of Tarrant County,Texas;
58.416 acres, more or less, out of the C. H. Putnam Survey, A-1250 and the T. J.
Thompson Survey, A-1503, and being the 60.00 acres described as "Second Tract' in
Warranty Deed dated March 18, 1924, from W. H. L. McCourtie to Trinity Portland
Cement Company,recorded in Volume 853,Page 602,Deed Records of Tarrant County,
Texas,
LESS, SAVE AND EXCEPT: 1.584 acres, more or less, out of the C. H.
Putnam Survey, A-1250, Tarrant County, Texas, and being the same land
described in Right of Way Deed dated October 10, 1941, from Trinity Portland
Cement Company to State of Texas, recorded in Volume 1496, Page 45, Deed
Records of Tarrant County,Texas;
50.406 acres, more or less, out of the C. H Putnam Survey, A-1250 and the T. J.
Thompson Survey, A-1503, Tarrant County, Texas, and being the same land described as
51.8 acres in Warranty Deed dated April 22, 1955, from Helen May Baker to Tarrant
County Water Control and Improvement District No. 1,recorded in Volume 2857, Page
3,Deed Records of Tarrant County,Texas
LESS, SAVE AND EXCEPT: 1.394 acres, more or less, out of the C. H
Putnam Survey, A-1250, Tarrant County, Texas being the same land described as
"Tract Two" in Warranty Deed dated December 9, 1969 from Nellie Reed, a'
widow,to City of Fort Worth,recorded in Volume 4817,Page 599,Deed Records
of Tarrant County,Texas
that lies within the above described Meacham Airport, an Addition to the City of Fort
Worth, Tarrant County, Texas, as described in Plats recorded as Plat A, Slide 2445
through Slide 2447,Plat Records of Tarrant County,Texas,
Parcel Two:
2.535 acres,more or less,more particularly described as:
4 CITY NCAHAUY
FT, woom"a, rez,
9,74 acres,more or less, out of the C. H. Putnam Survey, A-1250 and being ALL THAT PART
AND ONLY THAT PART of the 44.5 acres, more or less, described as "Tract No. 4-Runway
Area" in Release and Quit Claim Deed from Nellie Reed and Kenneth Reed to the City of Fort
Worth, recorded in Volume 4771, Page 527, Deed Records of Tar-rant County, Texas, THAT
LIES WITHIN the boundaries of the 30.74 acres, described in Warranty Deed dated August 8,
1955, from Nellie Reed, a widow, to Tarrant County Water and Control and Improvement
District No. 1,recorded in Volume 2900,Page 74,Deed Records of Tarrant County,Texas
LESS, SAVE AND EXCEPT: 7.205 acres, more or less, out of the C. H, Putnam
Survey, A-1250 and being ALL THAT PART AND ONLY THAT PART of the above
described land that lies within the above described Meacham Airport,an Addition to the
City of Fort Worth,Tarrant County,Texas,as described in Plats recorded as Plat A, Slide
2445 through Slide 2447,Plat Records of Tarrant County,Texas,
Parcel Three:
14.6093 acres,more or less,more particularly described in the following three tracts:
FIRST TRACT: 2.2563 acres, more or less, out of the Alexander F. Albright Survey, A-1849,
and being the same land described by metes and bounds in quit claim deed dated May 27, 1972,
from Lucille Beall McLean,et at.to the City of Fort Worth,recorded at Volume 5263,Page 899,
Official Public Records,Tarrant County,Texas;
SECOND TRACT: 10.00 acres,more or less, out of the Alexander F. Albright Survey, A-1849,
and the Robert Musselman Survey, A-1102, and being the same land described by metes and
bounds in warranty deed dated January 26, 1971, from Sara Beall,widow of Jarvis Beall, to the
City of Fort Worth, recorded at Volume 4993, Page 924, Official Public Records, Tarrant
County,Texas.
THIRD TRACT: 2.353 acres, more or less, out of the Robert Musselman Survey, A-1 102, and
being the same land described by metes and bounds in Controlled Access Highway Facility Deed
dated February 1, 1971, from the City of Fort Worth to the State of Texas (Highway
Commission), recorded at Volume 5025, Page 27, Official Public Records, Tarrant County,
Texas.
Parcel Four:
6.488 acres,more or less,described as follows:
Lots 14, 15, 17, 18, 19,20,21 and 22 of Block 1;
Lots 1,3,4,5,6,7,8,9 and 10 of Block 4;
Lots 5,6,7, 10, 12, 14, 15, 16, 18, 19&20 of Block 5;
all in the Airport Acres Addition, an addition to the City of Fort Worth, Tarrant County, Texas,
according to the plat recorded in Volume 1792, Page 91, Deed Records of Tarrant County,
Texas.
Parcel Five:
29.444 acres,more or less,described as follows:
Lots 1,2,3 and 4 of Block 1;
Lots 1, 17, 18, 19 and 20 of Block 2;
Lots 1,2,5,6,7,9 and 10 of Block 3;
Lots 1,3,5,6,7,8,9, 10, 11, 13 and 14 of Block 4;
Lots 1,2,4,5,6,7, 8,9, 10, 11, 12, 13, 16 and 20 of Block 5;
Lots 12, 13, 14, 15, 16, 17, 18, 19 and 20 of Block 6,
5
Lots A,B&D, 13, 14, 16, 17, 18 and 19 of Block 8;
Lots 3,4,5,7,8,9, 10, 13, 14, 15, 16, 17, 18, 19,20,21,22 and 23 of Block 9;
Lots 2,3, 10, 11, 12, 13, 17, 18, 19,20,21,22 and 23 of Block 10;
Lots 2,3,4,5,6,7,8,9, 10, 14, 15, 16, 17, 18, 19,20,21,22 and 23 of Block 11;
Lots 4,5,6,7, 8,9, 10, 11, 12, 13, 14, 15, 16, 17, 18,21 and 22 of Block 12;
Lots 12 and 13 of Block 13;
all in the Worth Hills Addition, an addition to the City of Fort Worth, Tarrant County, Texas,
according to the plat recorded at Volume 309, Page 60, in the Plat Records of Tarrant County,
Texas
LESS,SAVE AND EXCEPT any part of the above described land located lying within
the 7.8323 acres platted as Marine Creek Park, an Addition to the City of Fort Worth,
according to plat recorded as Volume A, Pages 2938-2939, Plat Records of Tarrant
County,Texas;
Parcel Six:
4.27 acres, more or less, out of the S.A. & M.G. Railroad Company Survey, A-1464 and the
James Wallace Survey, A-1605, Tarrant County, Texas, and being all that cart and only that
part of the following that lies West of State Highway Spur No 496 to-wit:
5.060 acres,more or less, out of the S.A. &M.G. Railroad Company Survey, A-1464, and being
the same land described in Warranty Deed dated July 7, 1932 from Annie L. White, a widow, et
al. to the City of Fort Worth, recorded in Volume 1166, Page 313, Deed Records of Tarrant
County,Texas;
34.016 acres, more or less, out of the S.A.& M.G. Railroad Company Survey, A-1464 and the
James Wallace Survey, A-1605 and being the same land described as First Tract of 25.036 acres
and Second Tract of 8.98 acres in Warranty Deed dated June 3, 1947, from Annie L. White, a
widow, et al. to the City of Fort Worth, recorded in Volume 1910, Page 561, Deed Records of
Tarrant County,Texas;
.394 acres,more or less, out of the S.A. & M.G. Railroad Company Survey, A-1464, and being
the same land described in Warranty Deed dated February 14, 1941, from Annie L. White, a
widow,et al.to the State of Texas,recorded in Volume 1467,Page 383,Deed Records of Tarrant
County,Texas;
LESS, SAVE AND EXCEPT any part of the above described land lying within the
Meacham Airport, an Addition to the City of Fort Worth,recorded as Plat A,Slide 2445
through Slide 2447, Plat Records of Tarrant County, Texas, said land is also shown as
Tract 1H2, Tract 1C and Tract 4 on Map 2042-420, Tarrant Appraisal District Map,
Tarrant County,Texas;
Parcel Seven:
2.034 acres,more or less, out of the S.A. &M.G. Railroad Company Survey,A-1464, and being
the same land described as the 2.034 acre tract in Warranty Deed dated November 24, 1982,
from The Atchison, Topeka and Santa Fe Railway Company,to City of Fort Worth,recorded in
Volume 7456,Page 1251,Deed Records of Tarrant County,Texas.
The hereinabove described Parcel One through Parcel Seven contains 819.6993 acres,more
or less,in the aggregate.
Ff '�' �'Yh� you
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Page 1 of 2
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 3/20/2007
DATE: Tuesday, March 20, 2007
LOG NAME: 30MEACH 070209 REFERENCE NO.: **L-14294
SUBJECT:
Approve Acceptance of Lease Agreement with XTO Energy Inc., for Natural Gas Drilling under 869
Acres More or Less of City-Owned Properties Located in Tarrant County, Texas, Known as
Meacham Airport
RECOMMENDATION:
It is recommended that the City Council approve the acceptance of a lease agreement for natural gas
drilling under 869 acres more or less of City-Owned Properties Located in Tarrant County, Texas, known as
Meacham Airport to XTO Energy Inc., for a one-year term.
DISCUSSION:
On May 17, 2005, (M&C G-14798) Fort Worth City Council authorized City staff to advertise City-owned
property known as Meacham Airport for the purpose of subsurface drilling and extraction of natural gas.
A request for bid proposals (RFP) was advertised for three consecutive weeks in the Commercial
Recorder, published on December 21, 2006, December 28, 2006, and January 4, 2007.
The following sealed bid for the gas lease was received and opened on January 11, 2007.
Bidders Lease Bonus/Acre Total Lease Bonus % Royalty Gift
XTO Energy Inc $17,111.00 $14,869,459.00 28%
Four Sevens Oil Co., Ltd. $13,500.00 $11,731,500.00 30% $250,000.00
Chesapeake Energy Corporation $11,785.00 $10,241.165.00 27.5%
Additional bid terms were included in the XTO Energy Inc., bid and the Four Sevens Oil Co., Ltd. bid.
XTO Energy Inc. offered a 1-year lease instead of the City standard 2-year lease. Four Sevens Oil Co.,
Ltd. bid included terms that the lease and bonus would be released and the bonus refunded if Four Sevens
Oil Co., Ltd. did not receive FAA approval of adequate well sites.
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. Staff and JPMorgan
Chase determined that XTO Energy Inc., had the best overall bid due to a larger upfront bonus, shorter
lease term, access to pipeline, and the ability to access minerals from both on-site and off-site locations.
After comparing information from bidders, City staff and JPMorgan Chase determined, based upon the
proposal content, that the XTO Energy Inc., bid is likely to yield the most revenues over the life of the well
(s).
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
http://www.fortworthgov.org/council_packet/Reports/mc—Print.asp 01/?n/2nn7
Page 2 of 2
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 $14,125,986.00 more or less.
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
GC24 446100 055240439020 $14,125,986.00
Submitted for City Manager's Office by: Marc A. Ott (8476)
Originating Department Head: A. Douglas Rademaker(6157)
Additional Information Contact: Jean Petr(8367)
http://www.fortworthgov.org/council_packet/Reports/mc_print.asp 03/20/2007