Title
Resolution - A Resolution to Consider Authorizing the Execution of a Gas Lease Agreement between the Mansfield Park Facilities Development Corporation (MPFDC) and Chesapeake Exploration, LLC for MPFDC-Owned Property Located at 1650 Matlock Road
Requested Action
Consider approving Gas Lease Agreement
Recommendation
Approve Gas Lease Agreement
Description/History
MPFDC owns the approximately 80 acres of property located at 1650 Matlock Road. Chesapeake is requesting a mineral lease agreement for this property. The drill site is located along 360, South of Broad Street and no drilling activity will occur on this property.
Justification
This lease has been approved by legal and recommended by staff. Chesapeake is offering a one year primary term with a $5,000/acre bonus and a 25% royalty amount. This offer exceeds the initial bid requirements that were approved by City Council in December 2005. In addition, this lease is completely free of all affiliate and non-affiliate post production costs; in other words, the City will receive CEMI's (Chesapeake's affiliate) downstream sales price free of all costs (when calculating MPFDC's royalty share).
Funding Source
N/A
Prepared By
Shelly Lanners, Director, Community Services
817-276-4265