Dthe OWNERSHIP REPORTS AND TITLE OPINIONS
COURTHOUSE RECORDS & OWNERSHIP REPORTS: (From Manual Notes or Digital
Images)
Instructions to Brokers , Field Landmen and Attorneys
In order to standardize Ownership Reports and Drilling and Division Order Title Opinions for
P_________(hereinafter the “client”) and to assure the Field Landmen, Brokers and
Attorneys, who provide P_______ with the digital images of land records it prefers , and the
Ownership Reports and Title Opinions needed to determine surface, mineral and leasehold
ownership, P________ will require use of the procedures, formats, and guidelines as to
content in those formats, set forth as follow:
PROCEDURES: P___ _______ wants the following Procedures—especially as they
relate to the capture, communication and transmission of information and documents—
to be conducted, first and principally, electronically by E-Mail with attachments, and
then, and only then, supported or replaced by overnight mailing of hard copies only as
made necessary by these procedures, such as DVD’s of recorded instruments.
Instructions to Brokers or Field Landmen:
P___ _______: Will determine the Primary and Secondary Formations to be drilled and tested
in the new well, the size and configuration of the Spacing Unit (640, 320 160, 80, 40, or 10
acres) which has been or is to be created to cover these formations, any existing wells
presently producing from the Primary Formation listed for the new well, and any Spacing,
Location Exception, Increased Density or Pooling Orders covering any of the existing wells
presently producing from that Primary Formation, together with any AMI Agreements, JOA ‘s,
Unit Declarations or other documentation affecting Leasehold ownership, in that Spaced Unit
and will then send these determinations and documents --together with copies of the
supporting OCC Orders, to its Broker or Field Landman.
Broker or Field Landman: Will then secure and create:
(1) a copy of ALL of the pages of the Tract Index (printed on 11” x 17” paper, if
possible, 8 ½” x 14” if necessary, or 8 ½” x 11” only if forced to do so at gunpoint
by the County Clerk) for the Section or Sections being examined
(2) a single light-scribe-labeled DVD disc containing:
(a) digital images of all OCC filings and Orders—e.g. 1002A s, Spacing, Location
Exceptions, Increased Density, Pooling, and other Orders
and documents sent to the Broker by P________
(b) digital images of all recorded instruments listed in the Tract Index from “Patent
to
Present” (i.e.from Inception to date of last search in the
courthouse)—with each
image of those instruments laid out in a
single folder and in continuous film-strip
order, labeled with the
book and page numbers at which, and in the same order in which, those
instruments appear on the Tract Index,
(c) a digital copy of the Assesor’s Surface Tax Rolls in a separate folder,
(d) a digital copy of the Tract Index in a separate folder,
(e) a digital copy of the Ownership Report prepared by the Broker from the
digital
images shot in the courthouse, in a separate
folder, listing:
(1) the full legal name (s) of all owners of surface, minerals and Leasehold in the Unit,
(2) last known address for each owner, of record, or from internet, local phone
books, etc.
(3) the date the last known address appears in the records
(4) the Social Security Number or Employer Identification Number, if available
(e.g. in plain sight onLeases or other instruments of record such as Wills
or Trusts)
(5) current or HBP Leases of that owner’s minerals
(6) surface acreage ownership and its tract legal descriptions,
(7) net mineral acreage ownership in tracts then in a Unit Summary
(8) decimal mineral interest to 6 places in 100% of the Spacing Unit, for each
and every owner of any interest—first Leasehold, then Minerals, then
Surface, in tracts then in a Unit Summary for the Spacing Unit being
searched, then,
(f) an electronic copy of the Ownership Report is e-mailed and a paper copy of
the Ownership Report is sent by overnight mail to the
Landman at P_______ who placed the order for a courthouse records shoot.
(g) (the light-scribed label on the top of the DVD disc, lists):
(1) the name, current address, and name and direct office or cell phone number
of the contact person responsible for having assembled the DVD
disc for the Broker,
(2) the Section, Township, Range, County(s) and State in which the
courthouse
search was conducted (in BOLD, minimum 10point Arial font, in the following
order—(viz. 28-8N-12E Hughes &
McIntosh, OK), (and yes, I know, that
some Brokers like to place
T, -then R, -then S in that order for database
search purposes,
but that’s not the way P________ wants to see it.)
(3) length of the search (e.g. “ from Patent at 1M /12 rec 5/12/1909 to 3127 /
455
rec. 10/12/08”) and
(4) date of last search in the courthouse or by fax from the courthouse (e.g.
“last
search: 11/1/08”).
NOTE: The Broker or Field Landman may also be called upon by the Attorney to produce a
paper “abstract” of the field shots to be sent to the examining Attorney.
P_________: will then have duplicate copies of the DVD disc sent from its Broker, after final
edit, together with any Unit Declarations, AMI Agreements, JOA ‘s or any other documents
affecting Leasehold title in the Unit, to both P________and the examining Attorney:
Attorney will then prepare the Drilling Title Opinion as follows:
both
In Legal-Sized Format (8 1/2” x 14”) on a DVD disc, and later printed on Legal Size paper, using
Microsoft WORD and EXCEL in this order:
1. The Name and Address of the Client—viz.
P______________ Energy LLC
000 West 0th Street, Suite 0000
Tulsa, OK 74000
2. The Type of Opinion—e.g.
Drilling Title Opinion (or Drilling Unit Title Opinion) OR Division Order Title Opinion
3. The Overall Legal Description of the Spacing Unit being examined—e.g.
(LANDS COVERED BY THIS OPINION:)
Section 28-8N-13E McIntosh County, Oklahoma
(Or, assuming these LANDS are Spaced on Lay-Down 320 s
N/2 Section 28-8N-13E McIntosh County, Oklahoma
(i.e. NOT A TRACT-BY-TRACT BREAKDOWN OF THE UNIT JUST YET !)
4. The Dates and Time through which title is being Certified. In a single short
sentence, state this set of facts for the Client (Penn Virginia) to see immediately—e.g.
“Based on the items examined listed on attached Exhibit “A”, with the last
instrument examined being that appearing at Book 1030 Page 353 as recorded
on September 19, 2008 and subject to the Comments and Requirements listed in
this Opinion, I find fee title to the captioned LANDS, as of September 28, 2008 at
5:00 p.m. CDT to be as follows:”
5. Unit Summary. Attorney lays out, on 8 “ ½ x 14” paper, in Microsoft Word, on the
very first (or first /2 x 14”few) page(s), the Unit Summary—that is, a Summary of
ALL of the FEE ownership in the Overall Legal Description of the Lands Covered by
this Opinion laid out as follows: (1) Surface Ownership, (2) Leasehold or Working
Interest Ownership, (3) Mineral and Royalty Ownership—with the Surface Title and
each of the three divisions of the Mineral Title adding up to the same total number of
acres in the subject Spacing Unit applicable to the target formation(s) in the proposed
well, complete and replete with the fractional interest calculations used to arrive at the
gross working interests, net working interests, royalties and overriding royalties, and
listing the Lease Numbers and Requirement Numbers used in the subsequent Lease
Tabulations and Requirements sections of the Opinion.
DRILLING TITLE OPINION
Lot 1(39.42 acres) and Lot 2 (39.36 acres) and the
South Half of the Northeast Quarter (S/2 NE/4)
of Section 0, Township 0 North, Range 16 East,
Pittsburg County, Oklahoma, containing 159.22 acres,
limited to the Booch and Hartshorne formations, exclusive of existing wellbores.
Dear Mr. Love:
Pursuant to your request, I have examined the tract indices of the Pittsburg County Clerk’s
Office and copies of the various instruments as filed of record covering the above captioned premises
from inception of title through October 5, 2008 with last instrument examined being that appearing at
Book 1125 Page 545 as recorded October 2, 2008. Pursuant to my examination, I find title suitable for
the purposes of drilling subject to the comments, objections and requirements as hereinafter set forth as
of October 5, 2008 at 8:00 a.m. as follows:
FEE TITLE:
SURFACE OWNERSHIP
OWNER
Lalman Farm Corporation
DESCRIPTION
1
Lot 1 and S/2 NE/4
Paul Helms 1
Lot 2
________________
1
Please refer to Objections and Requirements in regard to the above ownership in light of the execution
of a Warranty Deed recorded in Book 1595 at Page 281 purporting to cover Lots 1 and 2 and S/2 NE/4
by an apparent stranger to the record title ownership.
CONSOLIDATED WORKING INTEREST OWNERSHIP
Limited to the Booch and Hartshorne formations, exclusive of existing wellbores
Effective
NRI
75.0%
Owner
Lease
Penn Virginia MC Energy, 1 1,4
L.L.C.
Meade Oil & Gas, L.L.C.
2,3
Eland Energy, Inc.
2,3
77.74%
77.74%
Total
Acres
119.54
W.I.
Percentage
75.0785%
24.18
15.18654%
15.5
9.73496%
159.22
100%
_____________________
1
Please refer to Objection and Requirement No. 1, below, in regards to the working interest
ownership under Lease #4 shown owned by Penn Virginia MC Energy, L.L.C. insofar as same purports
to cover the SW/4 NE/4.
MINERAL AND ROYALTY OWNERSHIP
Owner
Name &
Address
Tract # (s)
George T. Blankenship
1485 Marble Lane
Bowlegs, OK 73895
1
Lease #(s)
4
Net
Mineral
Acres
Roy
NRI
39.42
.0464216
3/16
Req.
No.
3
COMBINED OIL AND GAS LEASEHOLD
Limited to the Booch and Hartshorne formations, exclusive of existing wellbores
I.
Leases #1 and #4
Penn Virginia MC Energy, L.L.C.
(79.54 acres @ 3/16 royalty)
(40 acres @ 1/4 royalty)
100%
1
_________________
1
The above working interest is subject to an overriding royalty interest of 1/16 x 8/8 owned by
Lawson Petroleum Company and insofar as Lease #1 covers the 79.54 acres.
II.
Leases #2 and #3
Meade Oil & Gas, L.L.C.
(29.76 acres @ .234375 royalty)
(9.92 acres @ 3/16 royalty)
60.9375%
Eland Energy, Inc.
39.0625%
6. Tabulation of Leases and Assignments: Attorney – now numbers and lays out, in
tabular form, the Leases presently within their terms or Held By Production, together
with the subsequent Assignments of each Lease or Overrides taken from that Lease
tabulated directly following each Lease. A sample FORM of such tabulations is as
follows:
LEASES AND ASSIGNMENTS
Lease #1
Dated:
Recorded:
Lessor:
Lessee:
Description:
Primary Term:
Royalty:
3/16
Delay Rentals:
Shut-in Gas Clause:
Pooling Clause:
Special Provisions:
Depth Restrictions:
September 18, 1973
Book 354, Page 116
Public Service Company of Oklahoma
Winjuan Industries, Inc.
E/2 NE/4 of Section 6-6N-16E
6 months
NONE: Paid Up Lease
Yes
Yes
None
limited to rights from surface to the base of the Hartshorne formation
Assignment of Lease #1
Dated:
Recorded:
Assignor:
Assignee:
Interest Assigned:
October 4, 1973
Book 354, Page 199
Winjuan Industries, Inc.
Great Basins Petroleum Company
All right, title and interest reserving
an overriding royalty interest of 1/16 x 8/8
Assignment of Lease #1 (ORRI)
Dated:
Recorded:
Assignor:
Assignee:
Interest Assigned:
August 14, 1984
Book 593, Page 228
Winjuan Industries, Inc.
First National Bank & Trust Company of Tulsa
All right, title and interest
Assignment of Lease #1 (ORRI)
Dated:
Recorded:
Assignor:
Assignee:
February 1, 1985
Book 607, Page 400
First National Bank & Trust Company of Tulsa
Lawson Petroleum Company
Interest Assigned:
All right, title and interest
Comment: Various assignments appear filed of record by and between the various successors and
assigns of Orville Eberly, James C. Meade, K.T. Meade, Jr., and Robert Eberly. All of this working
interest is subsequently vested in Meade Oil & Gas, L.L.C. via Assignments recorded in Book 1088 at
Pages 1-570.
7. Possession: Since a Drilling Title Opinion addresses both the Surface as well as the
Mineral Estate, it is necessary for the examining Attorney to cover the rights of any
parties who may be in actual physical possession of the Unit—be it a resident surface
owner or a tenant. This subject is often covered by a statement and Comment such as
that in the following FORM :
POSSESSION
The undersigned has not been furnished with any evidence of the parties in actual physical
possession of the captioned premises. Please refer to Comment No. 1 below in regard thereto.
COMMENTS:
1. This Opinion is subject to the rights of all parties in possession of the subject property.
You should determine what interest is claimed by any such party in possession other than the record
owners of the surface. In the event a tenant is in possession, we require you to obtain a tenant’s consent
agreement prior to the commencement of drilling operations on the property.
8. Encumbrances: This area of the Drilling Title Opinion covers the payment of Ad
Valorem taxes by the Surface Owners and Unreleased Mortgages which may create a
lien on Mineral Ownership. Here, the examining Attorney needs to lay out whether or
not he received the Tax Rolls called for on the DVD disc provided by the Broker and,
if so, whether they indicate any unpaid Ad Valorem taxes. Additionally, if the
instruments of record shown on the DVD disc reveal Unreleased Mortgages that
encumber the Mineral Estate, these should be noted—including residential mortgages
that give the Mortgagee a call on production from the Mineral Estate in the event of a
default in payment. A FORM for noting these Encumbrances follows:
ENCUMBRANCES
TAXES
There are no unpaid Ad Valorem Taxes through March 15, 2008.
UNRELEASED MORTGAGES
1.
2.
First Amended Mortgage
Dated:
Recorded:
Mortgagor:
Mortgagee:
Principal Amount:
Date Due:
Assignment of
Production:
Dated:
Recorded:
Mortgagor:
November 15, 2006
Book 1489, Page 308
Canaan Resources, L.L.C.
JPMorgan Chase Bank
$200,000,000
11/15/2011
Yes
April 28, 2006
Book 1463, Page 444
Canaan Resources, L.L.C.
3.
Mortgagee:
Principal Amount:
Date Due:
Assignment of
Production:
JPMorgan Chase Bank
$200,000,000
4/28/2010
Dated:
Recorded:
Mortgagor
Mortgagee:
Principal Amount:
Date Due:
Assignment of
Production:
January 5, 2008
Book 1493, Page 581
John C. and Cynthia Lalman, H&W JTs
First National Bank of Vernon
$135,000
1/5/2023
Yes
Yes
9. Unreleased Oil and Gas Leases: Here, the examining Attorney needs to indicate
whether the instruments of record reveal a past history of Oil and Gas Leases having
been taken on the Unit lands, but apparently have expired of their own terms without a
well having been drilled and completed on them or, if such as well was drilled and
completed, that it has been plugged and abandoned or no longer produces. In the
event any of these leases listed lands outside those in the Spacing Unit, they should
be tabulated and a Requirement made that Lessee secure a Certificate of Records
Search from the Oklahoma Corporation Commission certifying that no production has
been established on the outside lands or make a physical inspection of the Unit to
satisfy itself that there are no longer any well producing under the Lease in the Unit or
the additional lands. Two possible approaches to this problem are contained in the
following example:
UNRELEASED OIL AND GAS LEASES
Comment: A number of unreleased oil and gas leases appear filed of record covering the subject
premises. No oil and gas leases appear filed of record subsequent to Oil and Gas Leases #1-#4 as set
forth herein. It has been assumed for the purposes of this Opinion that all unreleased oil and gas leases
had previously expired by their own terms and are of no further force and effect and that Leases #1-#4
remain in full force and effect covering all the subject mineral rights underlying the subject lands.
Antero Resources Corporation has also acquired oil and gas leases covering rights below the base of the
Hartshorne formation which, due to the limited nature of this Opinion, have not been listed herein
Please refer to Objections and Requirements below in regard thereto.
OR
Lease #U-1
Dated:
Recorded:
Lessor:
Lessee:
Description:
September 18, 1985
Book 587, Page 119
John C. & Cynthia Lalman
San Juan Industries, Inc.
E/2 NE/4 of Section 6-6N-16E and W/2 NW/4 Section 5-6N-16E
Primary Term:
Royalty:
3/16
Delay Rentals:
Shut-in Gas Clause:
Pooling Clause:
Special Provisions:
Depth Restrictions:
3 years
NONE: Paid Up Lease
Yes
Yes 160 gas, 40 oil
None
from surface to the base of the Woodford formation
10. Pending Lawsuits, Judgments and Liens : Unless Lis Pendens, notices of mortgage
foreclosures, tax liens for unpaid improvement assessments or other forms of legal actions that
may result in a lien against the fee title appear in the instruments examined, these matters can
be handled by handled by the examining d using something like the following FORM:
PENDING SUITS, JUDGMENTS OR LIENS
No evidence of any pending suits, judgments or liens appears filed of record against the
captioned premises in the Pittsburg County Clerk’s Office. In connection with the foregoing, the
undersigned did not examine the civil direct/indirect indexes in the Pittsburg County Court Clerk’s
Office to verify that any lawsuits had been filed by or against the record title owners to the subject
premises nor did the undersigned examine the probate indexes. Please refer to Objections and
Requirements below in regard thereto.
11. Comments: This section of the Drilling Title Opinion can most often be used by the
examining Attorney to give the Lessee/Operator advice as to matters appearing of
record which are not so objectionable as to necessitate a Requirement. These
Comments often appear in a FORM, and covering matters such as the following:
COMMENTS:
1. The ownership as is reflected in this Opinion is based solely on the various documents
which have been filed of record in the county in which the subject property is located. Various matters,
including bankruptcy proceedings, are filed in the Federal District Court and are often not placed of
record in the County. The effect of any such matters filed in the Federal District Courts, therefore, has
not been incorporated in this Opinion.
12. Objections and Requirements: Here the examining Attorney lays out the seminal
problems with the Fee Title to the Unit lands that will require curative efforts on the
part of Lessee/Operator to assure the latter of Marketable Title to its Leases and
production from them. The first example FORM set forth below typifies the ideal
attempt to express the problem in the form of a Comment, and then the Requirement
to clear up this problem in something like twenty-five words or less.
OBJECTION NO. 4
A number of Affidavits appear filed of record as executed by Webb Energy, Inc. purportedly as
agent and as Attorney-in-Fact for Quench Oil & Gas, Inc. referencing the Lalman and PSC Wells
previously drilled in Section 6. The Affidavit indicates that Webb Energy, Inc. is claiming 100%
interest of the operators being Quench Oil & Gas, Inc. and Spartan Resources. Webb Energy, Inc. is a
stranger to the record title and the undersigned is unable to determine the basis for the affidavit as filed
of record. No agency agreement or power-of-attorney appears filed of record in favor of Webb Energy,
Inc. who would appear to be a stranger to the record title.
REQUIREMENT NO. 4
Investigation should be made as to the claims made by Webb Energy, Inc. as indicated in the
affidavits as filed of record in Book 1120 at Pages 261-311. You should verify with Quench Oil & Gas,
Inc. and Spartan Resources that Webb Energy, Inc. is not claiming any working interest in the subject
oil and gas leasehold.
But, when the Title gets quite gnarly, Penn Virginia may very well expect to see
something like this:
OBJECTION NO. 1
There is some question as to the working interest ownership underlying the SW/4 NE/4 as is
more fully discussed below. There are two separate and distinct chains of title as to the working
interest ownership under the SW/4 NE/4 under two separate oil and gas leases resulting in different
ownership depending upon which chain of title is applicable to the working interest ownership. G.E.
Lalman was the owner of all mineral rights underlying the SW/4 NE/4 as of the date of execution of the
oil and gas lease dated June 23, 1942, recorded in Book 30 at Page 273 in favor of M.M. Schene. M.M.
Schene subsequently conveyed all right, title and interest in the subject oil and gas lease in favor of
Public Service Company of Oklahoma. This oil and gas lease also covered acreage in the SW/4, NW/4
and SE/4 of Section 6 and also covered acreage in Section 1-6N-15E, Section 31-7N-16E and Section
36-7N-15E. This lease would appear to be held by production. Public Service Company of Oklahoma
subsequently acquired all of the subject mineral rights underlying this tract from the surface to the base
of the Hartshorne formation via Mineral Deed recorded in Book 13 at Page 264. Public Service
Company of Oklahoma after the subject mineral deed was, therefore, the owner of all mineral rights and
working interest ownership under the original oil and gas lease insofar as rights were covered from the
surface to the base of the Hartshorne formation as to the SW/4 NE/4.
The subject Oil and Gas Lease recorded in Book 30 at Page 273 was subsequently conveyed in
favor of Camerina Petroleum Corporation, Empire State Oil Company and Wilshire Oil Company of
Texas (1/3 working interest each) via Assignments recorded in Book 163 at Page 315, Book 164 at Page
95 and Book 164 at Page 110, respectively, all of said assignments dated May 18, 1964 in which Public
Service Company of Oklahoma conveyed all right, title and interest reserving an overriding royalty
interest of 1/8 x 7/8. As of the date of the subject assignment, it appears that the S/2 NW/4 and N/2
SW/4 of Section 6, created as a voluntary unit under the subject oil and gas lease, was the only acreage
upon which a well had been drilled. Subsequently, various assignments appear filed of record of the
subject Oil and Gas Lease recorded in Book 30 at Page 273 insofar as said lease covered the S/2 NW/4
and N/2 SW/4, only, (being the existing producing unit for the previous wells drilled on the subject
premises). The undersigned’s experience as to other wells as to non-developed acreage under the
subject oil and gas leases would indicate that Austral Oil Company would have subsequently succeeded
to the working interest of Camerina Petroleum Corporation, however, the copy of the Assignment
provided for examination recorded in Book 208 at Page 142 from Camerina Petroleum Corporation to
Austral Oil Company did not appear to list the Oil and Gas Lease recorded in Book 30 at Page 273.
Similarly, subsequent assignments from Austral Arkoma Company, the successor to Austral Oil
Company, Inc., did not appear to include the Oil and Gas Lease recorded in Book 30 at Page 273.
Subsequently, Public Service Company of Oklahoma executed a new oil and gas lease dated
April 15, 1975 (shown as Lease #4 herein) recorded in Book 391 at Page 40 in favor of Great Basins
Petroleum Company covering all rights from the surface to the base of the Hartshorne formation
underlying the SW/4 NE/4 with a one-year primary term and providing for a 1/4 royalty. It appears that
this subsequent oil and gas lease was recognized by the various working interest owners when the well
was subsequently drilled in the NE/4 of Section 6, however, it does not appear that the original lease
recorded in Book 30 at Page 273 was ever released of record. Subsequently, an Assignment appears
filed of record in Book 395 at Page 556 from Guy B. Kiker in favor of GBK 1972-A covering the
subject Oil and Gas Lease recorded in Book 30 at Page 273 in 1975 covering the undeveloped acreage
not including the S/2 NW/4 and N/2 SW/4. GBK 1972-A had previously conveyed by Assignment
recorded in Book 395 at Page 555, all of its right, title and interest in favor Gadsco, Inc. as to the subject
oil and gas lease insofar as said lease covered the S/2 NW/4 and N/2 SW/4, only. Great Basins
Petroleum Company and its successors subsequently assigned what is shown as Lease #4 herein via a
number of assignments as is indicated under “Leases and Assignments” creating the one chain of title.
What is referenced as the PSC #3 Well drilled in the NE/4 was apparently drilled under Lease #4. A
mortgage previously executed by Great Basins Petroleum Corporation referenced the ownership of an
undivided 75.0785% unit working interest which would include all the working interest as is reflected
herein under Leases #1 and #4.
The “other” chain of title for the previous Oil and Gas Lease recorded in Book 30 at Page 273
continues with the Assignment recorded in Book 687 at Page 297 from Gadsco, Inc. in favor of Spartan
Resources (75%) and Guy B. Kiker (25%) conveying all right, title and interest in the lease including all
descriptions and the SW/4 NE/4. Guy B. Kiker subsequently conveyed his interest in the subject
leasehold in favor of Spartan Resources who then conveyed 1/2 of the Guy B. Kiker interest in favor of
Wytex Production Corporation. Therefore, under the “other” chain of title as to the Lease recorded in
Book 30 at Page 273, Crow Creek Energy, L.L.C. remains the record title owner of a 1/3 working
interest under the subject lease as the successor to Wilshire Oil Company of Texas (13.3333 acres);
Spartan Resources, L.L.C. remains the record title owner of 23.3333 acres under the Lease and Wytex
Production Corporation remains the record title owner of 3.333 net mineral acres under the subject oil
and gas lease in the SW/4 NE/4.
In connection with the foregoing, it should be noted that subsequent assignments appear filed
of record in favor of XAE Corporation covering the NE/4 rights above the base of the Hartshorne Coal
formation in which the Hartshorne formation and the Booch Sand were both reserved by the assignors.
The subsequent assignments in favor of XAE Corporation recorded in 2004 referenced the assignment
of Lease #4 as set forth herein and XAE Corporation subsequently conveyed in favor of Spartan
Resources, L.L.C. 1/2 of its right, title and interest in Leases #1 and #4 as are set forth herein.
Therefore, Spartan Resources, L.L.C. has acquired working interest in the new Oil and Gas Lease #4
and, as noted above, is also an owner of working interest in the previous Oil and Gas Lease recorded in
Book 30 at Page 273.
In light of all the foregoing, the undersigned is unable to absolutely certify to the working
interest ownership as to the SW/4 NE/4 and to certify which of the two leases is the applicable lease for
your proposed test well. It would appear that Lease #4, as set forth herein, is superseded by the Oil and
Gas Lease recorded in Book 30 at Page 273 which would appear to be held by production. It should
be noted, however, that the various working interest owners in the chain of title for the drilling of the
wells in the NE/4 apparently recognized Oil and Gas Lease #4 as the valid lease when drilling the wells
above the base of the Hartshorne formation.
REQUIREMENT
Note that the undersigned has credited Penn Virginia MC Energy, L.L.C. with all the working
interest under Lease #4 and the SW/4 NE/4 as is set forth herein. Full copies of the various assignments
of the subject Oil and Gas Lease recorded in Book 30 at Page 273 with complete exhibits attached
thereto insofar as said exhibits refer to any oil and gas leasehold in Section 6 including Assignments
recorded in Book 208 at Page 64, Book 208 at Page 142, Book 331 at Page 196, and Book 352 at Page
376 should be obtained and submitted for examination. It has been assumed that Lease #4 is the valid
oil and gas lease covering rights from the surface to the base of the Hartshorne formation underlying the
SW/4 NE/4. Note that there is another chain of title, however, and the original Oil and Gas Lease
recorded in Book 30 at Page 273 is owned by parties other than Penn Virginia MC Energy, L.L.C.
Penn Virginia MC Energy, L.L.C. should acquire quit claim assignments of the Lease recorded in Book
30 at Page 273 from Spartan Resources, L.L.C. and Wytex Production Corporation. Otherwise, Penn
Virginia MC Energy, L.L.C. should institute and complete a quiet title suit wherein it quiets title to its
working interest ownership. In the alternative, the parties should stipulate as to their respective
ownership with words of grant and cross conveyance and as to whether the original Oil and Gas Lease
recorded in Book 30 at Page 273, or Lease #4 as set forth herein, is the valid oil and gas lease covering
the rights from the surface to the base of the Hartshorne underlying the SW/4 NE/4 of Section 6.
Depending upon what is submitted in connection with the foregoing, additional objections and
requirements and/or changes in and to the ownership may be necessitated.
13. Synopsis of Requirements: Here, Lessee/Operator is calling on the title Attorney to
summarize, in the fewest words possible, the gist of each of the Requirements, what
curative steps are necessary to assure Marketable Title to the Leasehold, and the amount
of net mineral acreage involved. A sample FORM for this Synopsis is as follows:
Synopsis of requirements
Section __- 7-__N-1W
______County, OK
Drilling Title Opinion:
Prior Requirements
1.
Stand-up opinion.
2.
Attorney’s disclaimers.
3-8. Advisory as to statutes.
9.
Advisory as to taxes.
10. (2.96 ac) No patent ____________________________________________________
11. (.41 ac) Pool decedent _________________________________________________
12. One acre tract is actually .9837 ac.
13. Easements.
14. (2.96 ac) No patent ____________________________________________________
15. (26.67 ac) Indian successorship __________________________________________
16. Advisory as to Indian lease.
17. Indian leases __________________________________________________________
18. Satisfied.
19. Assignment subject to unrecorded agreement ________________________________
20. Expired OGL’s _______________________________________________________
21. O.C.C. proceedings ____________________________________________________
Additional Requirements
22. Note depth clauses_______________________________________________________
23. Questar’s lease from Indians ______________________________________________
24. Lowry Exploration did not assign to Chesapeake ______________________________
25. Overrides subsequently reduced? ___________________________________________
26. Assignment of overriding royalty “of assignor’s interest” ________________________
27. Oxley now Chesapeake? ___________________________________________________
28. (.41 ac) Presumed successorship _____________________________________________
29. (.41 ac) Presumed successorship _____________________________________________
30. (10 ac) Spouses did not join in MD ___________________________________________
31. Stranger-to-title __________________________________________________________
32. Advisory as to statutes.
33, 34. Standard disclaimers.
14. Force Pooling Respondents List: Here, the examining Attorney is being called upon by
Penn Virginia to provide a list of Unleased Mineral Owners as direct Respondents to a
Force Pooling Application if needed to account for their net mineral acreage as part of the
Gross Working Interest ownerships calculations, as well as other potential claimants of
mineral title, such as possible heirs or successors to decedents, to be listed under a
separate heading for those respondents named for curative purposes only, this list will be
utilized by PVMCE ‘s Land Department to compose a final list, adding those Leasehold
owners who have failed to respond to Proposal Letters for the well to be drillied. An
example FORM of such a Force Pooling Respondents List follows:
RESPONDENTS POOLED (continued):
Page 2
44.
_(client)______________
29.
LeRoy Donald Haskett 11, Co-Personal Rep. of
the Estate of Mary Haskett, dec.
822 N. Meta Street
45.
Thomas C. Carlson IRA
Rollover Trust
U/A
Cordell, OK 73635-3037
dated 11/2/88 and
Amended 4/15/93,
Thomas C.
Carlson and Carlson
Management
Co.
30.
31.
Elizabeth A. Faulkner, fka Elizabeth
A. Stroud, Co-Personal Rep. of the
Estate of Mary Haskett, deceased
RR1, Box 1270
Coalgate, OK
74538
P. O. Box 600487
Dallas, TX
75360
46.
LeRoy Donald Haskett II
822 N. Meta Street
Clinton, OK
Cordell, OK 73635-3037
32.
47.
Sherry R. Jarvis
P. O. Box 125
Clinton, OK
Mabel Hamar
c/o Dixie Hohrman
604 S. 30th Cir, Apt. 2S
Dixie Hohrman
604 S. 30th Cir, Apt 2S
Clinton, OK
73601
33.
Eloise Hamar Keller
Box 39
Thomas, OK
73669
34.
Charles Cary Nimmo, aka Charles C. Nimmo,
Trustee of the Charles Cary Nimmo Revocable
Trust dated 1/20/97
P. O. Box 125
73601
73601
48.
Crystal McSparen aka
Crystal K.
McSparren fka Crystal Toles
3308 Fairway Drive
Moore, OK 73160
49.
Alvenia B. Nimmo
P. O. Box 125
Clinton, OK 73601
50.The Known &
Unknown
Clinton, OK 73601
Heirs of
Chester L. Roberts,
deceased
35.
c/o Beatrice Absher
12634 70th St.
Oskaloosa, KS
66066
Ouzel Resources, LLC
303 E. 17th Ave., Ste. 800
Denver, CO
80203
RESPONDENTS POOLED FOR CURATIVE PURPOSES
37
.Janice J. Podoll
700 17th St., Ste. 1750
Denver, CO
80202
38.
Poison Spider Oil Company, LLC
51.
Dixie Oil, Inc.
232 Cottonmouth Blvd
Uvalde, TX 78999
P. O. Box 5660
Denver, CO
80217
39.
H.N. Rhodes, P.E., LLC
4714 S. Jasper St
Denver, CO 80015-1714
74868
40.
Estate of Joy B. Schomp
c/o Dale Schomp
1223 Spiderbite Lane
Del Rio, TX 79666
RESPONDENTS DISMISSED:
36. Mark Phelps & Judy Phelps
P. O. Box 152
Seminole, OK
RESPONDENTS WITH
ADDRESS UNKNOWN:
52.
The Known & Unknown
Heirs of
Mary M. Hamar,
deceased
41.
Spinnaker LLC
700 17th St., Ste.
Denver, CO
ADDRESS UNKNOWN
1750
80202
53.
Known and unknown
of Jimmy Ross
Hamar
heirs
42.
Dorothy Jane Stevens, .a.k.a. Dorothy J. Stevens
11705 SW. 3rd St.
Yukon, OK
43.
73099
ADDRESS UNKNOWN
54.
Mabel Hamar
ADDRESS UNKNOWN
Winzeler Family Partnership, R.L.L.L.P.
10718 Olympia Dr.
Houston, TX 77042-2819
15. Spacing or Increased Density Respondents List: Here, Penn Virginia is asking the
examining Attorney to list all the names (and addresses, as provided initially in the
Brokers Ownership Report) of all owners of a right to production from the proposed
well. These lists will follow the same format as that for the Force Pooling Respondents
list next above, using the same serial numbering of each owner, save only that these
lists will have only two “headers” and columns of data under them—(1) all owners
WITH A LAST KNOWN ADDRESS, and (2) all owners WITHOUT A LAST KNOWN
ADDRESS.
DIVISION ORDER TITLE OPINIONS:
The instructions above for Brokers and Attorneys will be virtually the same for the
preparation of Division Order Title Opinions, with some exceptions as to content and
layout, as follow:
1.
Addresses and TIN’s as well as full legal names of Owners. At pain of repetition, and
even if the examining Attorney is not provided with a Broker’s Ownership Report
containing this information. Since owner identification and tracking them down for the
purpose of leasing their interest or forcing a lease from them by Pooling is substantially a
“name and address” game we will look to that Attorney to record these last known
addresses as he or she examines each of the instruments of record.
2.
Unit Summary – again, as in the case of the Drilling Title Opinion, Penn Virginia wants
to see this Summary on the first or first few pages of the Opinion, using the following
divisions and column headers:
ROYALTY:
Owner
Name &
Address
(TIN)__
Tract # /
Lease(s) #(s)
Revenue
Calculation
OVERRIDING ROYALTY:
(Owner) (Tract / Lease) (Revenue
Calculation)
Unit
Net
Revenue
(Unit NRI)
______
Requirement
Number (s)___
(Requirment #(s))
WORKING INTEREST:
(Owner) (Tract / Lease) (Revenue
Calculation)
Proportionate
(Unit NRI) Production
(Requirment #(s))
Interest
Exhibit # 1
Daniel D. Deepthinker
Attorney at Law
0000 S. Avenue, Suite 000
Bowlegs , OK 79001
(000) 000-8669
FAX (000) 000-9000
June 10, 2008
_______________Energy, L.L.C.
320 S. ____Suite 0000
Maude, Oklahoma 79002
Attn: Mr. Jon Love
Well
Re: South Suwanee Prospect – Suwanee River 1-4H
DRILLING TITLE OPINION
All of Section 000, Township 000 North, Range 000 West,
Wahoo County, Oklahoma, containing 639.4 acres, more or less
Dear Mr. Love:
Pursuant to your request, I have examined the tract indices of the Wahoo
County Clerk’s Office and copies of the various instruments as filed of record
covering the above captioned premises from inception of title through June 4,
2008. Pursuant to my examination, I find title suitable for the purposes of
drilling for oil and gas subject to the comments, objections and requirements as
hereinafter set forth as of June 4, 2008 at 8:00 a.m. which is one and the same
as the date of the recording of the Last Instrument Examined by me as recorded
at Book 1991 Page 87 in the office of the Wahoo County Clerk, as follows:
EXHIBIT # 2
CONSOLIDATED WORKING INTEREST OWNERSHIP
Effective
Total
NRI
Acres
W.I.
Owner
Lease
Percentage
P________ Energy,
L.L.C.
C___________Exploration,
L.L.C.
C_____Resources, L.L.C.
Tim Zapata
1-13
14,15
17
18
1-13
14,15
16
1-13
14,15
1-13
14,15
80%
78.25%
79.25%
74%
79.2%
78%
75%
310.0868
3.3067
7.1154
8.6538
329.1627
51.47993%
239.0835
1.5181
1.7154
242.3170
37.89756%
37.564
.330
37.894
5.92649%
77.75%
76.75%
79.25%
78.25%
2.5042
.0221
2.5263
Unleased Minerals
27.5000
639.4
100%
EXHIBIT # 3
FEE TITLE:
SURFACE OWNERSHIP
OWNER
Roger S_____and Donna S_____
DESCRIPTION
Lots 1 (39.1 a) and 2
(39.2 a) and
(Tenants in Common)
S/2 NE/4
Yvonne M.______
NE/4 SE/4
Leon S_____and Gweneth S_____,
SE/4
Joint Tenants
NW/4 SE/4 and S/2
Elaine P. B_______, Trustee of the
SW/4 and Lot 3 (39.05
a) and SE/4
.3951%
4.30092%
Elaine P. B_______
Revocable Living Trust
NW/4
Weldon R. S______and Joyce C.
SW/4 NW/4
S_______, Joint Tenants
Lot 4 (39.25 a) and
EXHIBIT # 4
MINERAL AND ROYALTY OWNERSHIP
Tract No. 1:
Lot 1 (39.96 acres) and Lot 2 (39.89 acres) and the South
Half of the Northeast Quarter (S/2 NE/4), a/d/a the
Northeast Quarter (NE/4) of Section 4, containing 159.85
acres, more or less.
Fractional
Lease
Owner
No.
Interest
Net
Lease
Acres
Royalty
Roger S_____
11
79.925/159.85
79.925
3/16
Donna S_____
11
79.925/159.85
79.925
3/16
Tract No. 2:
The Northeast Quarter of the Southeast Quarter (NE/4
SE/4) of Section 4, containing 40 acres, more or less.
Lease
Owner
No.
Yvonne M.________
2
Tract No. 3:
Fractional
Net
Lease
Interest
Acres
Royalty
40/40
40
3/16
The Northwest Quarter of the Southeast Quarter (NW/4
SE/4) and the South Half of the Southeast Quarter (S/2
SE/4), a/d/a the West Half of the Southeast Quarter (W/2
SE/4) and the Southeast Quarter of the Southeast Quarter
(SE/4 SE/4) of Section 4, containing 120 acres, more or
less.
Leon _____and Gwen
9
______, Joint Tenants
30/120
30
3/16
Michael G. Snider
7.5/120
7.5
3/16
6
Donald W. Snider
7.5/120
7.5
3/16
7
David B. Snider
7.5/120
7.5
3/16
8
Karen J. Spradlin
7.5/120
7.5
3/16
7
Joe B. Hinz and Karen V.
4.6154/120
4.6154
1/4
13
G.W. Lowry, Jr.
3.4615/120
3.4615
3/16
14
Don Sappington
3.4923/120
3.4923
3/16
12
Imperial Oil Company
8.6538/120
8.6538
1/4
18
Bank of Oklahoma, Trustee of 1 7.1154/120
7.1154
3/16
17
Hinz, Tenants in Common
the William R. Albracht I.R.A.
Leon Red
1.7154/120
1.7154
3/16
15
George S. Johnson
1.7308/120
1.7308
3/16
5
Charles W. Brown
1.7154/120
The United States of America, 2 27.5/120
Unleased
Bureau of Indian Affairs,
in Trust for the heirs of
Heap of______(member of
the Cheyenne/Arapaho TribeRestricted Indian)
1.7154
1/4
16
27.5
?
___________________
1
There is some question as to the ownership to the above 7.1154 net mineral
acres. Please refer to Objection and Requirements No. 7 below in regard
thereto.
2
This interest may have been leased for the benefit of __X____ Resources
Company, however, no lease appears filed of record or has been submitted for
examination. Please refer to Objections and Requirements below in regard
thereto.
Tract No. 4:
Lease
Owner
No.
The Southwest Quarter (SW/4) of Section 4, containing
160 acres, more or less.
Fractional
Net
Lease
Interest
Acres
Royalty
Ely P. B________, Trustee 1 160/160
160
10
of the Ely P. B_______Revocable Living Trust dated
August 16, 0000
3/16
_____________________
1
Ely P. B_______ as Trustee owns all the executory rights and 1/2 of the
rights to the royalty as to Tract No. 4. The following parties own the following
shares of a 1/2 non-participating royalty interest in perpetuity:
Name
% of 1/2 Non-Participating Royalty
Red____ ______, Ltd.
25%
Wayne and Shawn W______,
12.0002%
Joint Tenants
KOO, Inc.
6.25%
Acres
20.0
9.6004
5.0
Brian B_____
J.T. C______
Billy J. S________
Kenneth S_______
Janet W_____
Pauline M_______
Peggy H_____
Karlene S. G_____
Randy M. S_______
Jack W. S_______
James D._____, Paulette J. Q______
and Phyllis M. S______, Co-Trustees
of the Irving S______ and Linda
Sc______ 1987 Irrevocable Trust
Guy M____
Benferd J. H___
Carol L. ____
William A. L_____, Jr.
James R. W_____, Jr.
Patrick T. C______
Bill J. T_______
Christie L. G____
Laura J. T____
Danny R. M_____
Wayne G. G________
Stephen V. E_____
Tract No. 5:
4.5903
4.5903
4.3636
2.5739
2.4243
2.4243
2.4243
2.4243
2.4242
2.4242
2.2159
2.5%
1.5625%
1.5625%
1.275%
1.25%
1.25%
1.25%
1.25%
1.25%
1.25%
.625%
.625%
2.0
1.25
1.25
1.02
1.0
1.0
1.0
1.0
1.0
1.0
.5
.5
Lot 4 (39.74 acres) and the Southwest Quarter of the
Northwest Quarter (SW/4 NW/4) a/d/a the West Half of
the Northwest Quarter (W/2 NW/4) of Section 4,
containing 79.74 acres, more or less.
Fractional
Lease
Owner
No.
5.7379%
5.7379%
5.4545%
3.2174%
3.0304%
3.0304%
3.0304%
3.0304%
3.0303%
3.0303%
2.7699%
Interest
Net
Lease
Acres
Royalty
Weldon R. S_______ and
79.74/79.74
4
Joyce C. S_______, Joint Tenants
Tract No. 6:
79.74
3/16
Lot 3 (39.81 acres) and the Southeast Quarter of the
Northwest Quarter (SE/4 NW/4), a/d/a the East Half of the
Northwest Quarter (E/2 NW/4) of Section 4, containing
79.81 acres, more or less.
Lease
Owner
No.
Fractional
Net
Lease
Interest
Acres
Royalty
P______ Exploration and
3
Producing, Inc.
39.905/79.81
39.905
3/16
Arlene B______
1
39.905/79.81
39.905
3/16
EXHIBIT # 5
COMBINED OIL AND GAS LEASEHOLD
I.
Leases #1-#13
royalty)
_____________ Energy, L.L.C.
__________Exploration, L.L.C.
__________Resources, L.L.C.
Tim Zapata
(589.2385 acres @ 3/16
52.625%
40.575%
6.375%
.425%
1
2
2,3
2
__________________________
1
The working interest of _________Energy, L.L.C. is subject to an
overriding royalty interest of 1.25% owned by J___ D. W______.
2
The above working interest is subject is subject to an overriding royalty
interest of 2% x 8/8 owned by C_______ Energy, Inc. 6.375% of the working
interest shown owned by ______________Exploration, L.L.C. is subject to an
additional override of .75% owned by Tim Zapata and John Shoemaker, each.
3
All the working interest of Oxley Resources, L.L.C. is subject to an
overriding royalty interest of .75% owned by Tim Zapata and John Shoemaker,
each.
II.
Leases #14 and #15
royalty)
(5.1769 acres @ 3/16
________________Energy, L.L.C.
____________Exploration, L.L.C.
____________Resources, L.L.C.
Tim Zapata
63.875%
29.325%
6.375%
.425%
1
1,2
1,2
1
__________________
1
All the above working interest is subject to overriding royalty interest of
2.5% owned by _______ Energy Company, L.L.C. and a 1% x 8/8 overriding
royalty interest owned by C________ Energy, Inc.
2
6.375% of the working interest owned by C___________ Exploration, L.L.C.
and all the working interest owned by O__________Resources, L.L.C. is
subject to an overriding royalty interest of .75% x 8/8 owned by Tim Zapata
and John Shoemaker, each.
III. Lease #16
royalty)
(1.7154 acres @ 1/4
C___________ Exploration, L.L.C.
IV. Leases #17 and #18
royalty)
100%
(7.1154 acres @ 3/16
(8.6538 acres @ 1/4
royalty)
______________Energy, L.L.C.
100% 1
__________________
1
The working interest of ____________Energy, L.L.C. as to Lease #17 is
subject to a 2% x 8/8 overriding royalty owned by C_______ Energy, Inc. and a
1% override as to Lease #18 owned by C________Energy, Inc.
V.
Unleased Mineral Owners
EXHIBIT # 6
(27.5 acres)
LEASES AND ASSIGNMENTS
Lease #1
Type:
Dated:
Recorded:
Lessor:
Lessee:
Description:
Primary Term:
Royalty:
Shut-in Gas Clause:
Pooling Clause:
Entireties Clause:
Special Provisions:
Lease #2
Type:
Dated:
Recorded:
Lessor:
Lessee:
Description:
Primary Term:
Royalty:
Shut-in Gas Clause:
Pooling Clause:
Entireties Clause:
Special Provisions:
Lease #3
Type:
Dated:
Recorded:
Lessor:
Lessee:
Description:
Primary Term:
Royalty:
Paid-Up
July 9, 2005
Book 1015, Page 994
Arlene K. B_____
C____D_____ Energy, L.L.C.
Lot 3 and SE/4 NW/4 of Section 000-000N-000W
3 years
3/16
Yes - $1.00 per year per acre.
Yes
None
None
Paid-Up
July 9, 2005
Book 1016, Page 119
Yvonne M. F______
C____D_____ Energy, L.L.C.
NE/4 SE/4 of Section 000-000N-000W
3 years
3/16
Yes - $1.00 per year per acre.
Yes
None
The lease contains a pugh clause releasing all rights below
the deepest formation penetrated
Paid -Up
July 9, 2005
Book 1016, Page 125
Del __________, Individually and as Trustee of the Del
________ Revocable Trust dated January 17, 2000
C____D_____ Energy, L.L.C.
Lot 3 and SE/4 NW/4 of Section 4-11N-16W
3 years
3/16
Shut-in Gas Clause:
Pooling Clause:
Entireties Clause:
Special Provisions:
Yes - $1.00 per year per acre.
Yes
None
None
Special Provisions: The lease contains a pugh clause releasing all rights below
total depth plus 100 feet and a no deduction of cost clause
EXHIBIT # 7
Assignment of Leases #1-#13
Dated:
Recorded:
Assignor:
Assignee:
Interest Assigned:
January 1, 0000
Book 0000, Page 0000
C___ C____Energy, L.L.C.
See below
All right, title and interest reserving an overriding royalty
interest equal to the difference between 79.25% and
existing lease burdens
Assignee
O____ D_____, L.L.C.
Tim Zapata
C___ J. D____, Trustee of the
C___ J. D____ Revocable Trust
XYZ Energy, L.L.C.
Sierra Resources, Inc.
N______ Petroleum Corporation
C_______ Energy, Inc.
M______ Oil & Gas, L.L.C.
L_______ Exploration, Inc.
J____ E. W_____
R______ E. G_______
(retained 38.25%)
Assignment of Leases #1-#13 (ORRI)
Dated:
January 1, 0000
% of Interest
12.75%
.85%
4.25%
4.25%
9.35%
4.675%
3.75%
14.375%
3.0%
2.25%
2.25%
61.75%
Recorded:
Assignor:
Assignee:
Interest Assigned:
Book 0000, Page 0000
C____ C_____Energy, L.L.C.
C________ Energy, Inc.
The overriding royalty interest previously reserved to
79.25% in the previous assignment
Assignment of Leases #1-#13 (ORRI)
Dated:
January 1, 0000
Recorded:
Book 0000, Page 0000
Assignor:
C____ C_____Energy, L.L.C.
Assignee:
J___D___ W_______
Interest Assigned: A 1.25% overriding royalty interest on the working interest
of assignor
Assignment of Leases #1-#13
Dated:
August 8, 2006
Recorded:
Book 1044, Page 175
Assignor:
M_____________ Oil & Gas, L.L.C.
Assignee:
V_____Z______ Energy, L.L.C.
Interest Assigned: All right, title and interest
Assignment of Leases #14 and #15
Dated:
Recorded:
Assignor:
Assignee:
Interest Assigned:
September 1, 0000
Book 1054, Page 53
____ Energy Company, L.L.C.
V_____Z_______ Energy, L.L.C.
All right, title and interest reserving an ORRI of 2.5%
EXHIBIT # 8
POSSESSION
No evidence of possession has been submitted to the undersigned for
examination. Please refer to Comment No. 1 below in regard thereto.
EXHIBIT #9
ENCUMBRANCES
TAXES
Payment of Ad Valorem Taxes are not certified to.
UNRELEASED MORTGAGES
1.
Dated:
Recorded:
Mortgagor:
Mortgagee:
Oklahoma
Coverage:
Principal Amount:
Subordinated:
September 21, 2007
Book 1082, Page 439
Roger S_____ and Donna S_____
Oklahoma Bank & Trust Company, Bowlegs,
2.
Dated:
Recorded:
Mortgagor:
Mortgagee:
Coverage:
Principal Amount:
Subordinated:
August 29, 1991
Book 775, Page 325
George F______ and Yvonne F______
Farm Credit Bank of Wichita
NE/4 SE/4
$300,000.00
No. This mortgage should be subordinated in
favor of Lease #2
3.
Dated:
Recorded:
Mortgagor:
Mortgagee:
Coverage:
Principal Amount:
Subordinated:
September 23, 1981
Book 565, Page 354
Roger S______ and Donna S______
Commissioners of the Land Office
Lots 1 and 2 and S/2 NE/4
$98,700.00
No. This mortgage should be subordinated in
favor of Lease #11
4.
Dated:
Recorded:
Mortgagor:
Mortgagee:
Coverage:
Principal Amount:
Subordinated:
January 6, 1978
Book 476, Page 829
Weldon S_______ and Joyce S_______
Farmers Home Administration
Lot 4 and SW/4 NW/4
$40,000.00
No. This mortgage should be subordinated in
favor of Lease #4
Lots 1 and 2 and S/2 NE/4
$1,039,800.00
No and none is required
d
UNRELEASED OIL AND GAS LEASES
Comment: The undersigned’s review of the tract indexes and the various
documents submitted for examination reveal no unreleased oil and gas leases
that were executed prior to the effective date of the Oklahoma Statutory Pugh
Clause and which covered acreage other than in Section 4. It has been assumed
that all unreleased oil and gas leases whose primary terms have expired are of
no further force and effect and that there has been no production, a shut-in gas
well, or other operations sufficient to perpetuate any of the unreleased oil and
gas leases to date. Please refer to Objections and Requirements below in regard
thereto.
PENDING SUITS, JUDGMENTS OR LIENS
No evidence of any pending suits, judgments or liens appears filed of
record against the captioned premises in the Wahoo County Clerk’s Office. In
connection with the foregoing, the undersigned did not examine the civil
direct/indirect indexes in the Wahoo County Court Clerk’s Office to verify that
any lawsuits had been filed by or against the record title owners to the subject
premises nor did the undersigned examined the probate indexes. Please refer to
the Objections and Requirements below in regard thereto.
EASEMENTS AND/OR RIGHTS-OF-WAY
1.
Dated:
Recorded:
Grantor:
Grantee:
Description:
January 26, 1984
Book 642, Page 654
Donald S_____ et al
Reliance Pipeline Company
SE/4 SE/4 and W/2 SE/4
2.
Dated:
Recorded:
Grantor:
Grantee:
Description:
December 22, 1983
Book 642, Page 677
Manfred W______
Reliance Pipeline Company
SW/4
Comment: A Memorandum of Lease Agreement appears filed of record
referencing a surface lease covering the SE/4 dated June 24, 2002 for a 30 year
term by and between Leon and Gwen S_____ to L_________ Wind
Corporation, Inc.
Comment: You should ascertain the location of all easements and rights of way
and note the surface lease agreement as referenced above and ensure that your
intended operations do not interfere or encroach upon same.
EXHIBIT # 10
COMMENTS:
1. This Opinion is subject to the rights of all parties in possession of
the subject property. You should determine what interest is claimed by any
such party in possession other than the record owners of the surface. In the
event a tenant is in possession, we require you to obtain a tenant’s consent
agreement prior to the commencement of operations upon the property.
2. This examination does not cover rights of which possession might
be notice or orders, rules and regulations of governmental agencies, or
mechanics, materialmens or waiver of liens, or future installments of
assessments or liens of federal or state governments or any other claim not
shown of record in the materials examined;
nor can I certify as to the identity, competency, or majority of persons executing
the instruments shown in the chain of title.
3. Matters stated in this Opinion are subject to all orders of the
Oklahoma Corporation Commission with respect to pooling, spacing, the
establishment of drilling units, unitization and the like. These items are not
usually part of the public records and are not required to be. You should inquire
as to the terms of all such orders which may affect any one or more formations
underlying the subject property and furnish copies of all of same to me for my
examination. Furthermore, the undersigned has assumed that all orders of the
Oklahoma Corporation Commission relating to spacing, pooling and location
exceptions have been properly issued pursuant to correct legal notice and the
constitutionality of all rules and statues pertaining to the Corporation
Commission. The undersigned has also assumed the constitutionality of all
Oklahoma title curative statutes.
4. The ownership as is reflected in this Opinion is based solely on the
various documents which have been filed of record in the county in which the
subject property is located. Various matters, including bankruptcy proceedings,
are filed in the Federal District Court and are often not placed of record in the
County. The effect of any such matters filed in the Federal District Courts,
therefore, has not been incorporated in this Opinion.
EXHIBIT # 11
OBJECTIONS AND REQUIREMENTS
OBJECTION NO. 1
Your attention is directed to the unleased mineral interest owners as
are set forth above under “Ownership”.
REQUIREMENT
Previous to conducting drilling operations for your proposed test well
you should obtain as applicable, 1) an oil and gas lease from said mineral
interest owners, 2) a Participation or Joint Operating Agreement with those
mineral interest owners that desire to participate in your proposed test well, or
3) force pool those mineral interest owners with whom you cannot voluntarily
agree to develop the unit.
OBJECTION NO. 2
Your attention is directed to the various working interest owners that
own a record title working interest under existing oil and gas leases.
REQUIREMENT
Previous to conducting drilling operations for your proposed test well
you should obtain as applicable, 1) an assignment or farmout of said working
interest, 2) a participation or joint operating agreement with those working
interest owners that desire to participate in your proposed test well, or 3) force
pool those working interest owners with whom you cannot voluntarily agree to
develop the unit.
OBJECTION NO. 3
Your attention is directed to the fact that the primary terms of a
number of the base oil and gas leases as set forth herein expired in July of 2008
(being Leases #1-#12 herein). The undersigned, pursuant to your request, has
shown these leases as being valid oil and gas leases based upon the assumption
that you shall commence drilling operations previous to July 9, 2008 on the
subject premises. In the event that one or more of the oil and gas leases’
primary terms expire, then changes in and to the ownership as set forth herein
would be necessitated.
REQUIREMENT
You must independently ensure that you commence drilling operations,
as that term is defined by the Oklahoma Supreme Court, previous to the
expiration of the primary terms of the subject oil and gas leases.
OBJECTION NO. 4
As is noted under “Leases and Assignments” C_____Energy, L.L.C.
executed an assignment effective as of January 1, 2006 recorded in Book 1229
at Page 948. The Exhibit “A” attached to said assignment referenced an oil and
gas lease dated July 19, 2005 which was not recorded of record in Wahoo
County as executed by The Bureau of Indian Affairs on behalf of the heirs of
Heap of ______in favor of C_______Energy, L.L.C. The undersigned has now
been orally advised that this oil and gas lease was never approved and is not a
valid oil and gas lease in favor of C________ Energy, L.L.C. and, therefore, the
undersigned has reflected this interest as unleased herein. The undersigned has
further been orally advised that the lease was subsequently put up for bid at the
Bureau of Indian Affairs Auction and that T_______ Properties, Inc. was the
successful bidder on behalf of S____________Company. No records of the
Bureau of Indian Affairs or Concho agency have been examined.
REQUIREMENT
Investigation should be made as to the current existence and validity
of the subject oil and gas lease and whether, in fact, what is shown as the
unleased mineral interest has been leased. P_________L.L.C. should execute a
disclaimer of any interest under the subject oil and gas lease in light of the fact
that it was included on the exhibit to the subject assignment as above
referenced. You should name T______ Properties, Inc. and/or S__________
Company for your well proposal purposes. A status report of the subject oil and
gas leasehold and the records of the Bureau of Indian Affairs should be obtained
and submitted for examination. Depending upon what is submitted, additional
objections and requirements and/or changes in and to the ownership as set forth
herein may be necessitated.
OBJECTION NO. 5
A number of assignments of oil and gas leases as set forth herein by
and between C________ Energy, L.L.C. et al referenced that the assignments
were made subject to terms of an unrecorded letter agreement (apparently an
Exploration Agreement) dated November 15, 2004 by and between the
assignors and assignees. The undersigned has not examined a copy of the
unrecorded Letter Agreement and the effect of the terms, if any. Upon the
ownership as is set forth herein by and between the various assignees of
C________ Energy, L.L.C. have, therefore, not been incorporated herein.
REQUIREMENT
The unrecorded Letter Agreement should be obtained and submitted
for examination subject to possible additional objections and requirements
and/or changes in and to the ownership to be made in regards thereto.
OBJECTION NO. 6
C________ Energy, L.L.C. remains the record title owner of the
working interest under Leases #1-#13 shown owned by P_________, L.L.C.
The undersigned has credited this working interest in P__________, L.L.C. as
the apparent successor to the record title ownership of C_________ Energy,
L.L.C.
REQUIREMENT
Evidence of the succession by P____________, L.L.C. to the record
title working interest should be filed of record against the subject premises.
OBJECTION NO. 7
A Mineral Patent appears filed of record #35-85-0085 from The
United States of America to the Trust Company of Oklahoma “Trustee 000050-05” conveying an undivided 37/624 mineral interest in Tract No. 3. In
connection therewith, your attention is directed to the execution of Lease #17 by
the Bank of Oklahoma as Trustee of the William R. _______ IRA which
purports to cover this same interest. Subsequent to the above referenced
mineral patent, a Trustees Quit Claim Mineral Deed and Conveyance appears
filed of record dated November 4, 2005 recorded in Book 1023 at Page 340 in
which The Trust Company of Oklahoma, “Trustee 0658-50-05” (grantor)
conveys unto Donnie __________ Living Trust, The Trust Company of
Oklahoma as Agent (grantee) all of grantor’s right, title and interest referencing
an undivided 37/624 interest in all minerals underlying Tract No. 3.
Subsequently, however, a Mineral Deed appears filed of record dated June 27,
2006 recorded in Book 1041 at Page 650 wherein the Bank of Oklahoma, N.A.
(successor by merger to the interest of BancOklahoma Trust Company,
successor by merger to the interest of the Trust Company of Oklahoma,
Oklahoma City, Trustee 0658-50-05 (grantor) conveys unto Bank of Oklahoma
N.A. Trustee of the William R.________ IRA an undivided 37/624 interest in
Tract No. 3. The undersigned, for the purposes of this Opinion, has assumed
that the subsequent mineral deed is a valid mineral deed conveying the
undivided 37/624 mineral interest as originally created under the Mineral Patent
recorded in Book 1671 at Page 828.
REQUIREMENT
The Trust Company of Oklahoma as Agent for the Donnie
_______Living Trust should execute a Mineral Quit Claim Deed conveying an
undivided 37/624 mineral interest in the SE/4 SE/4 and the W/2 SE/4 of Section
4 and said mineral deed filed of record. You should name the Trust Company
of Oklahoma as agent of the Donnie__ ______Living Trust as a respondent in
your force pooling proceedings if the quit claim deed is not filed of record. In
the event that the Trust Company of Oklahoma as Agent of the Donnie_______
Living Trust is claiming the subject 37/624 mineral interest, which would
appear likely in light of the quit claim deed, then additional objections and
requirements may be necessitated in this regard. Depending upon what is
submitted in connection with the foregoing, additional objections and
requirements and/or changes in and to the ownership may be necessitated.
OBJECTION NO. 8
Leon _____was vested with an undivided 3/208 mineral interest
underlying Tract No. 3. Subsequently, a Mineral Deed appears filed of record
in Book 1742 at Page 2578 from Don S__________ to Leon ______conveying
an undivided 1.7 net mineral acre interest in Tract No. 3. Subsequently, a
Mineral Deed appears filed of record in Book 1742 at Page 2558 from Leon
______ in favor of Charles W. _____ purporting to convey “an undivided 1/2
interest” in the NW/4 SE/4 and S/2 SE/4. The undersigned, for the purposes
herein, has assumed that it was the intention of the subject mineral deed to
convey 1/2 of Leon_____ ’s mineral rights (i.e. an undivided 1/2 of grantor’s
interest) rather than an undivided 1/2 interest as is referenced in the mineral
deed.
REQUIREMENT
A Correction Mineral Deed should be executed and filed of record from
Leon______ and approved by Charles W. _____wherein an undivided 1/2 of
grantor’s mineral rights as of June 5, 1989 were conveyed by the subject
mineral deed.
OBJECTION NO. 9
A Mineral Deed appears filed of record in Book 950 at Page 380 from
Stephen R_______ and Diane R_____ in favor of R_______ Energy, L.L.C.
purporting to convey an undivided 6.96 net mineral acres in Section 4. Stephen
and/or Diane________ would appear to be strangers to the record title mineral
ownership based upon the documents examined by the undersigned.
REQUIREMENT
The muniment or basis of title by which Stephen R_____ and/or
Diane_______ acquired any mineral interest in Section 4 should be obtained
and submitted for examination. You may desire to name R_________ Energy,
L.L.C. as a respondent in your force pooling proceedings for protection
purposes. Depending upon what is submitted in connection with the foregoing,
additional objections and requirements and/or changes in and to the ownership
may be necessitated.
OBJECTION NO. 10
Your attention is directed to the unreleased mortgages as are set forth
above under “Encumbrances”.
REQUIREMENT
As to those mortgages executed previous to the base oil and gas leases as
executed by the mortgagors (Nos. 2, 3 and 4) these mortgages should be
subordinated in favor of the subject oil and gas leases. As to the mortgage
executed subsequent to the execution of the base oil and gas lease as executed
by the mortgagor, no requirement is deemed necessary for drilling purposes. In
the event of production for all the unreleased mortgages, the mortgagee should
join in the execution of the relevant division order or payment made to the
mortgagee pursuant to the assignment of production as contained in said
mortgages.
OBJECTION NO. 11
A Memorandum of Surface Lease Agreement appears filed of record
in Book 1946 at Page 874 dated June 24, 2002. This Memorandum gives notice
to third parties of a surface lease agreement between Leon and Glenn
_______and the L_________ Wind Corporation, Inc. This lease covers the
SE/4 and is for a 30 year term.
REQUIREMENT
Take notice of the existence of the lease agreement and ensure that your
intended operations do not interfere or encroach upon the rights of the lessee
under the subject surface lease.
OBJECTION NO. 12
A number of unreleased oil and gas leases appear filed of record
whose primary terms have expired. There are no unreleased oil and gas leases
executed previous to the effective date of the Oklahoma Statutory Pugh Clause
which covered acreage other than in Section 4. It has been assumed for the
purposes of this Opinion that all unreleased oil and gas leases whose primary
terms have expired are of no further force and effect.
REQUIREMENT
You must independently verify and ensure that there has been no
production, a shut-in gas well, or other operation sufficient to perpetuate the
unreleased oil and gas leases to date.
Very truly yours,
S___________
Attorney at Law