AAPL Oil, Gas and Mineral Lease

OIL, GAS AND MINERAL LEASE

Prepared by:

THIS AGREEMENT, entered into and effective as of by and between a corporation, , as Agent and Attorney-In-Fact for , , and (hereinafter referred to as "Lessor") and (hereinafter referred to as "Lessee") witnesseth, that:

Lessor, in consideration of the sum of ONE HUNDRED DOLLARS ($100.00) and other valuable considerations hereby lease and lets unto Lessee the right, insofar and only insofar as Lessor has a right to enter upon and use the land hereinafter described, for the exploration for, and production of oil, gas, sulphur and other minerals produced in conjunction therewith, for all purposes incident to the exploration for and production, ownership, possession, storage and transportation of said minerals and the right to dispose of salt water produced from the Leased Premises with the right of ingress and egress to and from said land at all times for such purposes, including the right to construct, maintain and use roads and pipelines thereon for operations hereunder.

Leased Premises being situated in the County of , State of , and more particularly described as follows, to wit:

The rights herein granted, including but not limited to, Lessee's right to use the surface of the Leased Premises are specifically limited to only the rights of Lessor acquired by Lessor in that certain Deed No. effective , recorded in Book at Page of the Conveyance Records of County, .

For the purpose of calculating the shut-in royalty, the Leased Premises shall be considered to comprise the number of acres as shown above totaling gross acres and net acres, whether it actually more or less.

This Lease shall be for a term of three (3) years from the date hereof (hereinafter referred to as ("Primary Term") and so long thereafter as oil, gas or other mineral is being produced in paying quantities or or operations are conducted either on the Leased Premises or on acreage pooled therewith, as hereinafter provided.

This Lease shall be for a term of three (3) years from the date hereof, unless on or before said date operations for of a well on the Leased Premises, or on acreage pooled therewith in search of oil, gas or other minerals and thereafter continues such operations and drilling to completion...

at its option, is hereby given the right and power to pool or combine into a unit the acreage covered by this Lease or any portion thereof with other land, lease or leases in the immediate vicinity thereof, when in 's good faith judgment it is necessary or advisable to do so in order to properly develop and operate said Leased Premises.

At the end of the primary term of this Lease, or upon cessation of continuous drilling or reworking operations after and of the Term as provided in paragraph 9, this Lease will terminate automatically as to all horizons lying below a depth of 100 feet below the base of the deepest producing pool...

The royalties to be paid by are:

(a) On oil, ONE-FOURTH (1/4TH) of that produced and saved from the Leased Premises and not used for fuel in conducting operations on the Leased Premises, or in treating such liquids to make them marketable;

(b) On gas produced from or attributable to the Leased Premises and sold, ONE-FOURTH (1/4TH) of the market value at the mouth of the well of the gas so sold;

(c) With respect to gas used other than for operations hereunder, royalty shall be ONE-FOURTH (1/4TH) of the market value at the mouth of the well as defined herein;

(d) On oil and gas by-products from processing, ONE-FOURTH (1/4TH) of the net amount received by Lessee;

(e) Lessee shall have free use of all oil, gas or any component thereof used in lease or unit operations as well as gas, water or other components thereof injected into subsurface strata;

(f) On sulphur, ONE-FOURTH (1/4TH) of that produced and saved from the Leased Premises, payable when marketed;

(g) ONE-FOURTH (1/4TH) of the market value at the well or mine of all other minerals produced and saved or mined and marketed;

(h) Oil royalties shall be delivered to Lessor free of expense at Lessee's option in tanks furnished by Lessee or to Lessee's credit in any pipeline connected therewith;

(i) Lessor is entitled to and shall be paid royalty not only on the oil, gas and other minerals produced, saved and sold or used pursuant to the terms of the Lease, but on all other monetary benefit received by Lessee from purchasers of oil and gas production by virtue of this Lease.

All royalty money due hereunder to Lessor during any month, when Lessee is purchaser of Lessee's royalty share production, shall be paid on or before one hundred twenty (120) days from the date of first production from any well located on the leased or on acreage pooled therewith, and thereafter shall be paid on or before the day of each month.

Payment of royalty shall be made to Lessors directly in their proportionate share at addresses to be provided to Lessee by .

Lessor shall have the right at all reasonable times, personally or by representative, to inspect and copy books, accounts, assignments, contracts, records and data of Lessee pertaining to production and marketing on the Leased Premises.

As to any and all wells drilled on the Leased Premises, or land pooled therewith, Lessee agrees to furnish Lessor the following:

(a) Access to the well and derrick floor, samples, cores and all tests and producing operations;

(b) Daily drilling reports including depth, footage drilled, present operation, formation, mud weight, water loss, deviation, pertinent remarks, and days since spud;

(c) Daily mud logs and mud log shows when mud logging;

(d) Data and information on any reworking operations;

(e) Copies of applications and reports made to any duly authorized authority;

(f) Two printed copies, digital copy of any well log obtained, in LAS, LIS, or ASCII format, final reports, drill stem test core analysis, directional survey or any other survey made in such well or work within 48 hours of availability;

(g) Confidentiality of all material furnished to Lessor upon request;

(h) Field notes of land surveys, maps, plats, title curative records, abstracts of title and title opinions;

(i) By mutual agreement of the parties, inspection records and information required by Paragraph 15 shall extend to additional wells and units.

Within sixty (60) days after the expiration, cancellation or termination of this Lease or any portion thereof, for any cause whatsoever, except for Lessee’s release of acreage in accordance with Paragraph 8, Lessor shall deliver to an instrument executed by in recordable form...

Failure to furnish said instrument subjects Lessee to a penalty payable to Lessor in the amount of AND NO/100 ($ ) DOLLARS per day...

Lessee shall be responsible for all damages caused by Lessee's operations. Lessee hereby releases and discharges from and shall indemnify and save harmless from and against any and all liability, damages, costs and expenses...

Any assignment, transfer or sublease of this Lease will contain specific provisions obligating all assignees to protect the rights of Lessor within the term of this Lease and specifically, but not limited to Lessee's obligations under Paragraph 20 above.

In case of execution, cancellation or termination of this Lease or any portion thereof, for any cause whatsoever, except for fraud or failure to pay royalties as provided in paragraph 12, Lessee shall have the right to retain under the terms hereof around each well producing, being reworked, or being hereunder, or shut in but capable of producing...

If Lessor brings suit to compel performance of or to recover for breach of any covenant or condition herein contained or implied and prevails therein, Lessee agrees to pay Lessor reasonable attorneys fees and expert witness fees in addition to the amount of judgment and cost.

All notices required or permitted to be sent hereunder shall be made as follows:

(a) To the Lessor.

Attention:

(b) To the Lessee.

Any notice should be sent by certified mail and shall be binding on the parties hereto as well as their successors and assigns, except that either party hereto, and its successors and assigns shall then the right by written notice to change the name or address to which any such notices shall be directed.

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