HomeMy WebLinkAbout07-19-1982 Regular Meeting18
The Airport Board of the City of Fairhope met July 19, 1982
at 3:00 p.m. at the City Administration Building, 387 Fair -
hope Avenue, Fairhope, Al.
Present: James E. Gaston, C.O. McCawley, Robert D. Colling
Gilbert Wesley, and Don Coogan, Chairman
The Chairman stated that this meeting was for the purpose of
discussing and voting on a proposal by representatives of AMMEX
Petroleum Co and Circle Seven Productions Co of Texas, to lease
mineral rights associated with certain lands comprising the
Fairhope Municipal Airport so as to permit testing for and
perhaps subsequent exploration for shallow depth(to 4000')
natural gas deposits.
Mr. John LeTard, an independent lease broker of Lafayette, La. was
thereupon introduced. He then outlined, to the Board members
the details of the proposal which provides, basically, that the
City will be paid the sum of $10.00 per acre for an initial 120
day period within which time the lessee(s) shall be permitted
to conduct a geophysical evaluation of the gas deposit potential
consisting of standard seismological studies in and across the
affected portions of the airport property. Subsequently, and
prior to the expiration of the initial 120 day period, if such
studies produce positive results, the proposal provides further
that the lessee(s) shall have the option of selecting the acreage
to be utilized for further exploration upon a further payment
of $100.00 per acre for the acreage so selected and along with
a stipulated royalty figure in the event gas is discovered and
production ensues thereafter.
It was pointed out that with the payments of $10.00 per acre(for
approximately 120 acres, more Rr ]lees as specified in the agree-
ment covering the initial one a w my day evaluation period
the lessee(s) is granted the option to subsequently lease such
acreage as it selects for exploration and production purposes
and the City will be obligated to execute the necessary legal
instruments(Lease and Permit) to that end in accordance with
the terms of a pre-printed form of Lease and agreement which Mr.
LeTard provided for the Board's examination. There was considerable
discussion relative to the technical aspects of the proposal and
the means that might be utilized to protect the airport facilities,
especially the runway, and taxiway, the approach places and other
transitional areas from damage during both the evaluation and
exploration stages. Mr. Mickey Robbins of the Seismic Petroleum
Services, Jackson, Miss who will perform the evaluation studies
was present to outline the procedures that would be employed and
provided the assurances as to indemnification for any damages
that might occur.
At the conclusion of the discussion Mr. McCawley made a motion
duly seconded to the effect that, subject to the lease and
agreement specifically providing adequate protection to the Airport
and its fari7it-ize�s as spelled out above, during the evaluation and,
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if occuring, the exploration and production periods, the Board
accept the proposal and request the City Council at its next
regular meeting on July 26, 1982 to approve the execution of
an appropriate lease agreement and permits, by the Board for
such purpose.
The motion passed and the meeting was thereupon adjourned.