HomeMy WebLinkAboutContract 40231CITY SECRETARY
COMRACT NO.
MEMORANDUM OF OIL AND GAS LEASE
STATE OF TEXAS §
§ KNOW ALL MEN BY THESE PRESENTS.
COUNTY OF TARRANT §
BE IT REMEMBERED that on the day of .1V\ A , 2010, a Paid Up Oil
and Gas Lease was made and entered into by and between the CITY OF FORT WORTH, a
home rule municipal corporation of the State of Texas, 1000 Throckmorton Street, Fort
Worth, Texas 76102, hereinafter called "(LESSOR)"; and Finley Resources, Inc., 1308 Lake
Street, Ft. Worth, Texas 76102, 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
A 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 3 day of M Ay , 2010.
LESSOR:
CITY OF FORT WORTH
By: Fernando Costa
Title: Assistant City Manager
ATTEST:
City S
APPROVED AS TO FORM AND LEG
y
Assistant City ttorney
Date:
Finley R�9ur�s,�.
h
ContraCt AUthorizatiou
`[aI 1 ID
mate
ACKNOWLEDGEMENTS
THE STATE OF TEXAS
COUNTY OF TARRANT
the undersigned notary
public, on this day personally appeared Fernando Costa, known to me to be the person whose
name is subscribed to the foregoing instrument and, that he has executed the same for the
purposes and consideration therein expressed.
GIVEN under my hand and seal of office this 3�1( day of ,
2010. e
Public, State of Texas
My Commission Expires:
Commission Number:
THE STATE OF TEXAS
COUNTY OF TARRANT
Thi instrument was acknowledged before me thi
byl%t rr as AP CA _inn«,'.
on behalf of said corporation.
My Commission Expires: ise�� �•�-�
Commission Number:
Public, S
of Finley Resources, Inc.,
Texas
WADE G. CHAPPEII
Notary Public, State of Texas
My Commission Expires
October 21, 2013
Exhibit A
8.8 acres, more or less, being a portion of the F.G. Mulliken Survey, A-1045 and the E.
Little Survey, A-945, situated in the City of Fort Worth, Tarrant County and being more
particularly described by metes and bounds in that certain Warranty Deed dated
January 28, 1954, by and between Nicholas Vloitos, et al, as Grantor and the City of
Fort Worth, as Grantee, recorded at Volume 2674, Page 43, Deed Records, Tarrant
County, Texas.
(West Northside Drive ROW)
3
M&C Review
Page 1 of 2
COUNCIL ACTION: Approved on 4/27/2010
Official site of the City of Fort Worth, iexas
DATE: .-: 4/27/2010 REFERENCE NO: L14972 LOG NAME06WEST
NORTHSIDE DR
CODE: L NOW PUBLIC
TYPE: CONSENT HEARING: NO
SUBJECT: Approve the Acceptance of a Lease Agreement with Finley Resources, Inc., in the Amount
of $34,760.00 for Natural Gas Drilling Under 8.8 Acres of City -Owned Properties Known as
West Northside Drive Right -of -Way Located at the Intersection of Northside Drive and
Samuels Avenue for a Two Year Primary Term (COUNCIL DISTRICTS 2 and 9)
RECOMMENDATION:
It is recommended that the City Council approve the acceptance of a Lease Agreement for natural
gas drilling under 8.8 acres, more or less, of City -owned properties known as West Northside Drive
Right -of -Way to Finley Resources, Inc., for a two year primary term.
DISCUSSION:
On September 4, 2007, the City Council approved a Lease Agreement with Chesapeake Exploration,
LLC, for West Northside Drive Right -of -Way (M&C L-14387) with a bonus amount of $6,577.00 per
acre for a total bonus of $57,877.60. This Agreement was executed on October 30, 2007, (City
Secretary Contract Nos. 36046 and 36047) for a two year term which expired on October 30, 2009.
Because the lease expired, the property became eligible for bidding again for a new lease.
A Request for Bid Proposals (RFP) for West Northside Drive Right -of -Way was advertised for three
consecutive weeks in the Fort Worth Star -Telegram, published on February 25, 2010, March 4, 2010,
and March 11, 2010.
The following sealed bids for the gas lease were received and opened on March 18, 2010.
Bidder Lease Bonus/Acre Total Lease Bonus Royalty
Chesapeake Exploration, LLC $3,617.00 $31,829.60 25 Percent
Finley Resources, Inc. $3,950.00 $34,760.00 25 Percent
The bids received were evaluated by staff and the City's Mineral Management Consultant, Midkiff Oil
and Gas. 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. Upon review of
the drill plans submitted by the bidders, Finley Resources, Inc., offered a higher bonus and has the
closest drill site that can access this tract. Therefore, it is recommended that award of this lease go to
Finley Resources, Inc. Timely award and execution of this lease will allow for inclusion of these
properties in the drilling unit currently being formed.
In accordance with the City's Mineral Management Consulting Agreement, City Secretary Contract No.
37980, the net transfer to the City is estimated to be $33,195.80, more or less.
The City has established aMinority/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
http://apps.cfwnet.org/council�acket/mc review.asp?ID=13349&councildate=4/27/2010 5/18/2010
M&C Review
Page 2 of 2
M/VVBE participation goal is required.
All bonus, royalty and other revenues received from this lease will be deposited according to the
current Financial Management Policy Statements (M&C G-16747, approved November 3, 2009) as
follows: 1) 50 percent of the revenue will be allocated to the Capital Projects Reserve Fund; and 2) 50
percent of the revenue will be allocated to the Fort Worth Permanent Fund - General.
The property is located in COUNCIL DISTRICTS 2 and 9, Mapsco 62M and 62R.
FISCAL. INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that the Planning and Development
Department is responsible for the collection and deposit of funds due to the City.
TO Fund/Account/Centers
3C10 446100 006060001000 $17,380.00
T127 446100 006127099901 $17,380600
Submitted for City Manager's Office bv:
Originating Department Head:
Additional Information Contact:
ATTACHMENTS
Exhibit 1.pdf
FROM Fund/Account/Centers
GC10 531260 006060001000 782.10
T127 531260 006127099901 782.10
Fernando Costa (6122)
Susan Alanis (8180)
Jean Petr (8367)
http://apps.cfwnet.org/council�acket/mc_review.asp?ID=13349&councildate=4/27/2010 5/18/2010