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■iii PrrI P !ilit in.F PIV. 111tI I/11:11'IciINMI ■I III
<br /> Reception#: 783697
<br /> '03/24/2010 11:52:32 RM Jean Alberico
<br /> 1 of 7 Rec Fee:$36.00 Doc Fee:0.00 GARFIELD COUNTY CO
<br /> Lease No. C153314L
<br /> Project No. 1
<br /> Property Location T7S R95W 6th P.M.
<br /> OIL AND GAS LEASE
<br /> THIS AGREEMENT made and entered into this/014`-day of March, 2010, by and between the
<br /> STATE OF COLORADO, DEPARTMENT OF NATURAL RESOURCES, COLORADO WATER
<br /> CONSERVATION BOARD, hereinafter called "Lessor", and WILLIAMS PRODUCTION RMT COMPANY
<br /> hereinafter called "Lessee".
<br /> WITNESETH
<br /> 1. That the Lessor,for and in consideration of$1,500.00, cash in hand paid, receipt of
<br /> which is hereby acknowledged, and of the covenants and agreements hereinafter contained on the part of
<br /> the Lessee to be paid, kept and performed, has granted, demised, and leased, and by these presents
<br /> does grant, demise, and lease exclusively unto said Lessee, the exclusive right of producing there from
<br /> all oil and gas of whatsoever nature or kind that tract or tracts of land situated in the County of Garfield,
<br /> State of Colorado, described as follows, to-wit:
<br /> Township 7 South, Range 95 West, 6th P.M.
<br /> Section 7: A 0.978 acre tract of land more fully described by metes and bounds in Exhibit
<br /> "A" attached hereto and made part thereof by reference in Garfield County, Colorado.
<br /> 2. It is agreed that this lease shall remain in force for a term of five years from June 1, 2009
<br /> and as long thereafter as oil, or gas of whatsoever nature or kind, or either of them is produced from said
<br /> land or premises pooled therewith. If prior to discovery of oil or gas on said land, or on acreage pooled
<br /> therewith, or if after discovery of oil or gas production thereafter should cease for any cause, this lease
<br /> shall not terminate if Lessee (if it be within the primary term)commences or resumes the payment or
<br /> tender of rental on or before the rental-paying date next ensuing after the expiration of three (3) months
<br /> from the date of cessation of production. If, at the expiration of the primary term of this lease, oil or gas is
<br /> not being produced from said land or said pooled premises, but Lessee is then engaged in reasonable
<br /> attempts to extract oil and/or gas from these premises, then this lease shall continue in force for so long
<br /> thereafter as such reasonable attempts are being continuously prosecuted on the premises or operating
<br /> pooled unit which includes all or a part of said land.
<br /> If oil or gas shall be discovered and/or produced from the above described premises after the
<br /> expiration of the primary term of this lease, this lease shall continue in force so long thereafter as oil or
<br /> gas is produced from the premises or from any such pooled unit, which includes all, or a part of said
<br /> lands.
<br /> 3. In consideration of the premises the Lessee covenants and agrees:
<br /> a. To deliver to the credit of Lessor, free of cost in the pipeline to which Lessee may
<br /> connect his wells, the equal eighteen percent(18%) part of all oil produced and saved from the premises,
<br /> or at the Lessee's option, may pay to the Lessor for such eighteen percent(18%) royalty, the market price
<br /> for oil of like grade and gravity prevailing on the day such oil is run into the pipeline or into storage tank.
<br /> When the amount due for royalties is less than Twenty-five ($25.00) dollars, lessee, its assigns or
<br /> successors, is to defer the making of such payment until such time as the aggregate amount due exceeds
<br /> such sum.
<br /> b. To pay lessor for gas of whatsoever nature or kind produced and sold, or used
<br /> off the premises, or used in the manufacture of any products there from, eighteen percent(18%), at the
<br /> market price at the well for the gas sold, used off the premises, or in the manufacture of products there
<br /> from. Where gas from a well producing gas only is not sold or used, Lessee may pay or tender as royalty,
<br /> 1 of 7 Rev 03/06
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