HomeMy WebLinkAboutContract 39107 CITY SECRETARY
CONTRACT NO. . I ()
SUBSURFACE WELLBORE LICENSE AGREEMENT
This Subsurface Wellbore License Agreement("Agreement")is hereby made and entered
into by and between the CITY OF FORT WORTH, a home rule municipal corporation
organized under the laws of the State of Texas and acting by and through Fernando Costa, its duly
authorized Assistant City Manager, and XTO Energy, Inc. ("Company"), a Delaware
Corporation, acting by and through Edwin S. Ryan Jr., Senior Vice President, Land
Administration.
The following statements are true and correct and constitute the basis upon which the
City of Fort Worth has executed Agreement.
A. Company, wishes to drill a subsurface horizontal wellbore through City owned
property from a gas well to a unit.
B. The City has reviewed Company's request and agrees to grant Company a license
and right of way to use a portion of city owned property, known as Buck Sansom Park, as set out
in Exhibit "A" (Subsurface Tract) in order to drill a wellbore in accordance with the terms and
conditions of this Agreement.
Agreement
1. GRANT OF RIGHTS.
Subject to the terms and conditions set forth in this Agreement the City of Fort Worth
grants Company, a subsurface wellbore license agreement and right-of-way to provide Company
ingress to and egress from, and the right to use and occupy, the subsurface of the Subsurface
Tract for one (1) wellbore(s) to drill across, through and under the subsurface of the Subsurface
Tract as to the depths and location described in Exhibit A with a hundred (100) foot margin of
error. This agreement is applicable to the Rosen Heights 1 H well only.
Subsequent to the drilling of the wells for which this Agreement is being granted,
Company shall provide to City an as-built survey limiting the Agreement area for the one (1)
wellbore(s) to that described by a cylinder having a radius of five (5) feet with the radius point
being the center of the wellbore (pipe) and whose length is determined by the horizontal (plan
view) measurement of the pipe through and under the City's Subsurface Tract as shown in
Exhibits A. Thereafter, the license agreement granted herein shall be restricted solely to the
wellbore of said well. Company shall deliver to City an as-built survey of the wellbore within
ninety (90)days of first production from said well.
It is understood and agreed that this Agreement is a subsurface wellbore license
agreement and right-of-way only and in no way grants or conveys any part of the underlying fee
simple estate of any lands owned by the City. Company shall have no right to use the surface of
the tract of land for any purpose. This subsurface license agreement does not convey the right to
produce the oil, gas or other minerals under the tract of land. City reserves the right to use any
and all subsurface outside of the wellbore license agreement on properties owned by the City.
Notwithstanding the use of the terms "grant" hereinabove set forth, the City does not
warrant the title to the subsurface license agreement and right-of-way herein granted to the
Company.
OFFICIAL RECORC
CITY SECRETARY 1 - -
FT. 1r1iORTH, TIC
2. TERM.
This Agreement shall become effective on the date as of which both parties have
executed it("Effective Date")and shall expire at 11:59 P.M. CST twenty (20)years from the last
date of notarial acknowledgement unless terminated earlier as provided herein.
3. FEES AND PAYMENT TO THE CITY.
On or prior to the Effective Date, Company shall pay the City as compensation for its use
of the City property for the term of this Agreement the sum of Seventy-Seven Thousand and Four
Dollars and no cents, $77,004.00 ("License Fee"). Company hereby acknowledges and agrees
that the amount of this License Fee constitutes just and reasonable compensation to the City for
Company's use of the City property.
4. COMPLIANCE WITH LAWS,ORDINANCES,RULES AND REGULATIONS.
Company, at its sole cost and expense, shall comply at all times with all applicable
federal, state and local laws, rules, regulations and safety standards in connection with
Company's activities hereunder.
5. INDEMNIFICATION.
COMPANY, ITS SUCCESSORS AND ASSIGNS, SHALL AND HEREBY DOES
INDEMNIFY AND HOLD HARMLESS CITY, ITS OFFICERS, DIRECTORS, AGENTS,
CONTRACTORS, SERVANTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, FROM AND
AGAINST ALL LIABILITY, CLAIMS, DEMAND, FINE, DAMAGES, SUITS, ACTIONS,
COSTS AND EXPENSES OF WHATSOEVER NATURE (INCLUDING REASONABLE
ATTORNEYS' FEES) TO PERSONS OR PROPERTY CAUSED BY OR ARISING OUT OF
ANY OF COMPANY'S OPERATIONS HEREUNDER OR OTHERWISE RELATING TO
THE SUBSURFACE WELLBORE LICENSE AGREEMENT AND RIGHT-OF-WAY,
EXCEPT WHERE SUCH CLAIMS RESULT FROM THE ACTS, OMISSIONS AND
NEGLIGENCE OF CITY, ITS OFFICERS, DIRECTORS, AGENTS, CONTRACTORS,
SERVANTS OR EMPLOEES.
6. DEFAULTS.
The occurrence at any time during the term of this Agreement of one or more of the
following events shall constitute and"Event of Default"under this Agreement:
6.1 Failure to Pay License Fee.
An Event of Default shall occur if Company fails to pay any License Fee on or before the
respective due date.
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6.2 Breach.
An Event of Default shall occur if Company materially breaches or violates any
of the terms, covenants, representations or warranties set forth in this Agreement or fails
to perform any obligation required by this Agreement.
7. UNCURED DEFAULTS AND REMEDIES.
7.1 Notice of Default and Opportunity to Cure.
If an Event of Default occurs on account of Company's failure to pay the License
Fee in accordance with Section 6.1, such Event of Default shall be deemed an Uncured
Default and the City shall have the right to terminate this Agreement immediately upon
provision of written notice to Company. If an Event of Default occurs for a reason other
than for failure to pay the License Fee, the City shall provide Company with written
notice and shall give Company the opportunity to cure such Event of Default. For and
Event of Default which can be cured by the immediate payment of money to the City,
Company shall have thirty (30) days from the date it receives written notice from the City
to cure the Event of Default. For any other Event of Default, Company shall have sixty
(60) days from the date it receives written notice from the City to cure the Event of
Default. If any Event of Default is not cured within the time period specified herein, such
Event of Default shall, without further notice from the City, become an "Uncured
Default"and the City immediately may exercise the remedies provided in Section 7.2.
7.2 Remedies for Uncured Defaults.
Upon the occurrence of an Uncured Default, the City shall be entitled to exercise,
at the same time or at different times, any of the following remedies, all of which shall be
cumulative of and without limitation to any other rights or remedies the City may have:
7.2.1 Termination of Agreement.
Upon the occurrence of an Uncured Default, the City may terminate this
Agreement. Upon such termination, Company shall forfeit all rights granted to it
under this Agreement, and, except as to Company's unperformed obligations and
existing liabilities as of the date of termination, this Agreement shall
automatically be deemed null and void and shall have no further force or effect.
Company shall remain obligated to pay and the City shall retain the right to
receive License Fees and any other payments due up to the date of termination.
Company shall remove the Subsurface Wellbore from and restore the City
Property as and when requested by the City. The City's right to terminate this
Agreement under this Section 7.2.1 does not and shall not be construed to
constitute any kind of limitation on the City's right to terminate this Agreement
for other reasons as provided by and in accordance with this Agreement;
provided, however, that Company may not abandon the Subsurface Wellbore
without the approval of the Texas Railroad Commission or successor agency or
other regulatory authority with jurisdiction, if such action without such approval
is prohibited at the time by applicable federal or state law or regulation.
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7.2.2 Legal Action Against Company.
Upon the occurrence of an Uncured Default, the City may commence
against Company an action at law for monetary damages or in equity, for
injunctive relief or specific performance of any of the provisions of this
Agreement which, as a matter of equity,are specifically enforceable.
8. INSURANCE.
Company shall procure and maintain at all times, in full force and effect, a policy
or policies of insurance to provide coverages as specified herein, naming the City as an additional
insured and covering all public risks related to the use, occupancy, condition, maintenance,
existence or location of the City. The insurance required hereunder may be met by a combination
of self-insurance, primary and excess policies.
8.1 Primary Liability Insurance Coverage.
• Commercial General Liability:
$1,000,000 per occurrence, including coverage for the following: (i)Premises
Liability; (ii) independent contractors; (iii) products/completed operations;,
(iv)personal injury; (v) contractual liability; (vi)explosion, collapse and
underground property damage.
• Property Damage Liability:
$10,000,000 per occurrence
• Automobile Liability:
$1,000,000 per accident, including,but not limited to, all owned, leased,
hired or non-owned motor vehicles used in conjunction with the rights
granted under this Agreement
• Worker's Compensation:
As required by law; and, Employer's Liability as follows:
$1,000,000 per accident.
8.2 Revisions to Required Coverage.
At the reasonable recommendation of the City's risk Manager, the City may at
any time revise insurance coverage requirements and limits required by this Agreement.
Company agrees that within thirty (30) days of receipt of written notice from the City,
Company will implement all such revisions requested by the City. The policy or policies
of insurance shall be endorsed to provide that no material changes in coverage, including,
but not limited to, cancellation, termination, non-renewal or amendment, shall be made
without thirty 930)days'prior written notice to the City.
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8.3 Underwriters and Certificates.
Company shall procure and maintain its insurance with underwriters authorized
to do business in the State of Texas and who are acceptable to the City in terms of
solvency and financial strength. Within thirty (30) days following adoption of this
Agreement by the City Council, Company shall furnish the City with certificates of
insurance signed by the respective companies as proof that it has obtained the types and
amounts of insurance coverage required herein. In addition, Company shall, on demand,
provide the City with evidence that it has maintained such coverage in full force and
effect.
8.4 Deductibles.
Deductible or self-insured retention limits on any line of coverage required
herein shall not exceed $1,000,000 in the annual aggregate unless the limit per
occurrence, or per line of coverage, or aggregate is otherwise approved by the City.
8.5 No Limitation of Liability.
The insurance requirements set forth in this Section 8 and any recovery by the
City of any sum by reason of any insurance policy required under this Agreement shall in
no way be construed or effected to limit or in any way affect Company's liability to the
City or other persons as provided by this Agreement or law.
9. COMPANY AS INDEPENDENT CONTRACTOR.
It is expressly understood and agreed that Company shall operate as an independent
contractor as to all rights and privileges granted by this Agreement, and not as an agent,
representative or employee of the City. Company shall have the exclusive right to control the
details of its business and other operations necessary or appurtenant to the transportation of Gas
in accordance with the terms and conditions of this Agreement, and shall be solely responsible for
the acts and omissions of its officers, agents, servants, employees, contractors and subcontractors.
Company acknowledges that the doctrine of respondeat superior shall not apply as between the
City and Company, its officers, agents, employees, contractors and subcontractors. Company
further agrees that nothing herein shall be construed as the creation of a partnership or joint
enterprise between the City and Company.
10. ASSIGNMENT PROHIBITED.
Company may not assign or otherwise transfer any of its rights or obligations under this
Agreement unless specifically authorized in writing by the City, which authorization shall not be
unreasonably withheld.
11. NOTICE.
Notices required pursuant to the provisions of this Agreement shall be conclusively
determined to have been delivered when (i) hand-delivered to the other party, its agents,
employees, servants or representatives, or (ii) received by the other party by the United States
Mail,postage prepaid, return receipt requested, addressed as follows:
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To THE CITY: To COMPANY:
City of Fort Worth XTO Energy, Inc.
Manager,Gas Lease Program Attn: Edwin S. Ryan Jr.
Planning and Development Department 810 Houston Street
1000 Throckmorton Street Fort Worth,Texas 76102
Fort Worth, TX 76102
Either party, by notifying the other party hereto in the manner provided in this paragraph, may
designate a different address for receipt of subsequent notices.
12. SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and shall inure to the benefit of the City and the
Company and their respective successors and assigns.
13. NON-DISCRIMINATION COVENANT.
Company shall not discriminate against any person on the basis of race, color, national
origin, religion, handicap, sex, sexual orientation or familial status in the receipt of benefits from
Company's business operations, in any opportunities for employment with Company or in the
construction or installation of the Subsurface Wellbore.
14. NO WAIVER.
The failure of the City to insist upon the performance of any term or provision of this
Agreement or to exercise any rights that the City my have, either under this Agreement or the
law, shall not constitute a waiver of the City's right to insist upon appropriate performance or to
assert any such right on any future occasion.
15. GOVERNING LAW AND VENUE.
This Agreement shall be construed pursuant to and in accordance with the laws of the
United States of America and the State of Texas. If any action, whether real or asserted, at law or
in equity, arise out of the terms of this Agreement or Company's use of City property, venue for
such action shall lie exclusively in state courts located in Tarrant County, Texas or the United
States District Court for the Northern District of Texas, Fort Worth Division.
16. SEVERABILTIY.
If any provision of this Agreement is held to be invalid, illegal or unenforceable by a
final order entered by a court of competent jurisdiction,the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired. For purposes of this
Agreement, a court order shall be final only to the extent that all available legal rights and
remedies pertaining to such order, including, without limitation all available appeals, have been
exhausted. In such event, the City and Company agree that they shall amend or have amended
this Agreement to comply with such final order entered by a court of competent jurisdiction.
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17. FORCE MAJEURE.
In the event Company's performance of any of the terms, conditions or obligations
required by this Agreement is prevented by a cause or event that is not within Company's
reasonable control, Company's non-performance shall be deemed excused for the period of such
inability. Causes or events that are not within the Company's control shall include, but not be
limited to, acts of God, strikes, sabotage, riots or civil disturbances, failure or loss of utilities,
explosions and natural disasters.
18. HEADINGS NOT CONTROLLING.
Headings and titles, that are used in this Agreement are for reference purposes only and
shall not be deemed a part of this Agreement.
19. ENTIRETY OF AGREEMENT.
This Agreement, including the schedule of exhibits attached hereto and any documents
incorporated herein by reference, contains the entire understanding and agreement between the
City and Company as to the matters contained herein. Any prior or contemporaneous oral or
written agreement is hereby declared null and void to the extent in conflict with the terms and
conditions of this Agreement. This Agreement shall not be amended unless agreed to in writing
by both parties and approved by the City Council of the City.
EXECUTED and effective as of the later date below:
CITY OF FORT WORTH XTO Energy,Inc.
By: By: --
Name: �-A&4vJ Name: Edwin S. Ryan Jr.
Title Assistant City Manager Title S Land Administration
Date:_ 9/1109 Date: �ID4
OFFICIAL RECORD
CITY SECRETARY
FT WORTH, TX
7
ATTEST:
City Secretary
AFF�R%O r1L ASS TO FORM AND LEGALITY:
Assistant City Attorney
M&C:_ L-180.
ACKNOWLEDGMENTS
STATE OF TEXAS
COUNTY OF TARRAN/�TL,, r�
BEFORE ME, �,Y(Q f W I �°S ,the undersigned notary public, on this day
personally appeared Edwin S. Ryan Jr., Sr. Vice President, Land Administration of XTO Energy
Inc., known to me to be the person whose name is subscribed to the foregoing instrument and,
that(s)he has executed the same for the purposes and consideration therein expressed..
GIVEN under my hand and seal of office this S+ day of 7 ,2009.
.�w"''w� CHARLA F.WILKES
4";=,
NOTARTPUBUCSTATE OFTws Notary's Public to and for the State of Texas
COMMISSION EXPIRES:
��OFs�+� 03-06-2012
STATE OF TEXAS
COUNTY OF TARRANT¢
BEFORE ME,C. ' ,the undersigned notary public, on this day
personally appeared na nci r, Pn��,4-n ,known to me to be the person whose name is
subscribed to the foregoing instrument and, that(s)he has executed the same for the purposes and
consideration therein expressed.
GIVEN under my hand and seal of office this� _day of ,2009.
tary's Public in and for the State of Texas
OFFICIAL RECORD' EVDNIADANIELS
CITY SECRETARY ;? MY COMMISSION EXPIRES
n9t S July 10,2013
FT WORTH, TX �
8
Proposed Rosen Heights I
Existing
iyp Quarry A 2H Unit
% 3375.24'
MD
353a
\ Jo
"a "
ay�•
City of Fort Worth
Vol.966 Pg.225
D.R.T.C.T, \•\ _ Unit Line
ND
•\ I6605.23'
MD
•\ � 7195'
Proposed
Rosen Heights Unit
o `\
rc
EXHIBIT"A"
SUBSURFACE WELLBORE Unit Line
LICENSE AGREEMENT
August 20,2009.
XTO ENERGY INC. The location shown hereon was staked from tract
lines as evidenced by occupation.Distances shown
ROSEN HEIGHTS UNIT IN
are not intended to be definitive in establishing title
TARRANT COUNTY,TEXAS boundaries.The acreage shown hereon were
provided by others.Bearings are based on NAD 27
SCALE: 1"=200' State Plane coordinates.
From the Office of ELS Surveying 6 Mapping,Inc./ FOR THE EXCLUSIVE USE OF
Harry L.Johnson 6 Associates-Aledo,Texas XTO ENERGY INC.
Drafter:C.S. Job No: 295802 Map No.S.L.A.Exhibit
M&C Review Pagel of 2
Official site of the City of Fort Worth,Texas
CITY COUNCIL AGENDA FOR�TI-I
COUNCIL ACTION: Approved on 8/11/2009
DATE: 8/11/2009 REFERENCE NO.:L-14819 LOG NAME: 0606BUCK SANSOM
PARK 0062040
CODE: L TYPE: NON- PUBLIC CONSENT HEARING: NO
SUBJECT: Authorize the Execution of a Subsurface Wellbore License Agreement with XTO Energy,
Inc., in the Amount of$77,004.00 for One Subsurface Wellbore Across City-Owned
Property Known as Buck Sansom Park, Located at 3600 Sansom Park Drive
RECOMMENDATION:
It is recommended that the City Council authorize the execution of a Subsurface Wellbore License
Agreement with XTO Energy, Inc., for one subsurface wellbore across City-owned property known as
Sansom Park, located at 3600 Sansom Park Drive, in the amount of$77,004.00.
DISCUSSION:
The City of Fort Worth (City) has been approached by representatives of XTO Energy, Inc., requestinc
Subsurface Wellbore License Agreement across City-owned property known as Buck Sansom Park,
located at 3600 Sansom Park Drive. The Subsurface Wellbore License Agreement is for one wellbore
from the Rosen Heights Unit 1 H well to the Rosen Heights unit which includes Marine Creek Linear P-,
currently under lease by XTO Energy, Inc.
On February 8, 2005, (M&C L-14029) the subsurface area of Buck Sansom Park was converted for of
gas drilling and extraction. On November 1, 2005, (M&C C-21120) Buck Sansom Park was leased for
natural gas drilling. The City's mineral interest in the Buck Sansom Park property is currently being sei
by wells in the Sansom Park Unit. The proposed wellbore will cross the southeast portion of Buck San
Park at a depth of 3,375 to 6,605 feet below the surface of the property outside of the Barnett Shale al
not conflict with the City's mineral interest.
Per the terms of the Subsurface Wellbore License Agreement, XTO Energy, Inc., will pay the City $46
per linear foot of wellbore pipe for a total cost of$77,004.00. No surface use of the property will be gre
The property is located in COUNCIL DISTRICT 2, Mapsco 47V and 47Z.
FISCAL INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that the Planning and Development Department
responsible for the collection and deposit of funds due the City under this Agreement.
TO Fund/Account/Centers FROM Fund/Account/Centers
C223 446300 201929990200 $77,004.00
Submitted for City Manager's Office by: Fernando Costa (6122)
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=12231&councildate=8/11/2009 9/1/2009
M&C Review Page 2 of 2
Originating Department Head: Susan Alanis (8180)
Additional Information Contact: Jean Petr (8367)
ATTACHMENTS
Exhibit 1.pdf
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=12231&councildate=8/11/2009 9/1/2009