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SHARED RIGHT-OF-WAY AGREEMENT
THIS AGREEMENT made as of ______, 20____.
BETWEEN:
COMPANY A, a body corporate, having an office in the City of Calgary, in the Province of Alberta (hereinafter referred to as “Assignor”)
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COMPANY B, a body corporate, having an office in the City of Calgary, in the Province of Alberta (hereinafter referred to as "Assignee”)
(Assignor and Assignee are hereinafter collectively referred to as the “Parties”)
WHEREAS:
A. Pursuant to the terms of a Farmout Agreement dated ______, Assignee earned a 100% interest in and to ______(the “Lands”), including a pipeline from ______to ______(License No. ______Line ___) (the “Pipeline”) and a related pipeline right-of-way (the “Pipeline Right-of-Way”) (the Lands, Pipeline and Pipeline Right-of-Way hereinafter referred to collectively as the “Assignee Assets”);
B. The Pipeline Right-of-Way is governed by the terms of a certain Alberta Pipeline Right-of-Way Agreement dated ______between Assignor and ______(the “Right-of-Way Agreement”), a copy of which is attached hereto as Schedule “A,” which agreement covers lands in addition to the Lands (the “Assignor Assets”);
C. The Pipeline and the portion of the Pipeline Right-of-Way owned by the Assignee are shown in red on the survey plan attached to the Right-of-Way Agreement; and
D. The Parties wish to provide for shared access to the Pipeline Right-of-Way so that each Party may conduct operations with respect thereto and enjoy the rights and benefits thereof to the extent of its rights to the Assignor Assets and the Assignee Assets, as the case may be.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the premises and of the respective covenants and agreements of the Parties as hereinafter set forth, the Parties covenant and agree with one another as follows:
1. SHARED ACCESS TO THE PIPELINE RIGHT-OF-WAY
(a) Subject to the terms of this Agreement and the Right-of-Way Agreement, the Parties agree that each shall be granted access to the Pipeline Right-of-Way as may reasonably be required for all lawful purposes incidental to the Assignor Assets and the Assignee Assets, as the context requires, until such time as either the Assignor Assets or the Assignee Assets have been abandoned and the other Party has been notified thereof.
(b) Without limiting the generality of the foregoing and subject to the terms of this Agreement and the Right-of-Way Agreement, the rights granted by this Agreement shall include the following:
(i) the right of the Assignor and Assignee, respectively, to enter across, over, under, on or through the Pipeline Right-of-Way to survey, operate, maintain, repair, replace, abandon or reclaim the Assignor Assets or the Assignee Assets, respectively, or any equipment or fixtures appurtenant to such assets
(ii) the right of the Assignor and Assignee, respectively, to encroach upon, cross, parallel, abut, or tie-into any part of the Assignee Assets or Assignor Assets, respectively, located within or adjacent to the Pipeline Right-of-Way subject to the terms of applicable crossing or proximity agreements between the Parties; and
(iii) the right to construct additional pipelines within the Pipeline Right-of-Way, subject to approval by the other Party prior to construction, such approval not to be unreasonably withheld.
(c) Neither Party shall charge the other a fee for the rights of access granted by this Agreement.
(d) Each Party shall abide by and comply with all applicable laws, regulations, standards, orders, bylaws and other rules of any governmental authority having jurisdiction over the use of the Pipeline Right-of-Way.
2. DECLARATION OF TRUST
(a) Assignor acknowledges and declares that it holds and shall continue to hold the Right-of-Way Agreement, to the extent it pertains to the Assignee Assets, in trust for the Assignee.
(b) While it holds the Right-of-Way Agreement in trust the Assignor shall:
(i) not do or cause anything to be done whereby the Pipeline Right-of-Way is impaired, assigned, transferred, encumbered or surrendered without the prior written consent of the Assignee; and
(ii) be responsible for and shall promptly pay all property taxes, rental payments and all other payments and charges related to the Pipeline Right-of-Way. To the extent that any portion of such amounts is solely attributable or properly allocable to the Assignee Assets, the Assignor shall be entitled to recover such amounts from the Assignee. Any amounts recoverable from the Assignee in accordance with this clause shall be invoiced by the Assignor and paid by the Assignee within thirty (30) days after receipt of the invoice.
3. QUIET ENJOYMENT
Each Party shall be entitled to quiet enjoyment of all benefits and rights conferred pursuant to its ownership of the Assignor Assets or Assignee Assets, as the context requires, which for all lawful purposes are necessary or incidental to its ownership of the Assignor Assets or Assignee Assets respectively, provided that in so doing, neither Party shall do anything to adversely affect the benefits, rights, or Assets held by the other Party.
4. COVENANTS OF ASSIGNOR
Assignor covenants and agrees with Assignee:
(a) to notify Assignee in advance of any operations, repairs or any activity conducted by Assignor with respect to the Assignor Assets which may affect the Assignee Assets in any manner whatsoever;
(b) to not at any time damage, disturb or adversely affect in any way the Assignee Assets or any other property of Assignee located adjacent to or upon the Pipeline Right-of-Way;
(c) to operate, abandon and reclaim the Assignor Assets in a good and workmanlike manner in accordance with good oilfield practices and in compliance with the Right-of-Way Agreement, all applicable laws, regulations, standards, orders, bylaws and other rules of any governmental authority having jurisdiction over the Assignor Assets; and
(d) in an emergency, to take steps that would reasonably be taken by a prudent operator in order to preserve each Party’s Assets and protect human life, and to notify Assignee forthwith.
5. COVENANTS OF ASSIGNEE
Assignee covenants and agrees with Assignor:
(a) to notify Assignor in advance of any operations, repairs or any activity conducted by Assignee with respect to the Assignee Assets which may affect the Assignor Assets in any manner whatsoever;
(b) not at any time damage, disturb or adversely affect in any way the Assignor Assets, or any other property of Assignor located adjacent to or upon the Pipeline Right-of-Way;
(c) to operate, abandon and reclaim the Assignee Assets in a good and workmanlike manner in accordance with good oilfield practices and in compliance with surface dispositions and all applicable laws, regulations, standards, orders, bylaws and other rules of any governmental authority having jurisdiction over the Assignee Assets; and
(d) in an emergency, to take steps that would reasonably be taken by a prudent operator in order to preserve each Party’s Assets and protect human life and to notify Assignor forthwith.
6. ASSIGNMENTS
Neither Party shall dispose of all or any of its interests in the Assignor Assets or the Assignee Assets, as the case may be, unless or until the proposed assignee or purchaser executes an assignment and novation agreement by which such proposed assignee or purchaser assumes the obligations of the assigning Party under this Agreement.
7. INDEMNITIES
(a) Assignor will be liable to Assignee for and shall indemnify Assignee against all actions, claims, demands, losses, costs (including legal costs on a solicitor and his own client basis), damages and expenses brought against or suffered by Assignee or that Assignee sustains, pays or incurs, as a result of a failure of Assignor to comply with its obligations pursuant to this Agreement or of the negligence or wilful misconduct of Assignor, its employees, agents or contractors.
(b) Assignee will be liable to Assignor for and shall indemnify Assignor against all actions, claims, demands, losses, costs (including legal costs on a solicitor and his own client basis), damages and expenses brought against or suffered by Assignor or that Assignor sustains, pays or incurs, as a result of a failure of Assignee to comply with its covenants and obligations pursuant to this Agreement or of the negligence or wilful misconduct of Assignee, its employees, agents or contractors.
8. NOTICES
(a) The addresses for service and the fax numbers of the Parties shall be as follows:
COMPANY A______
Calgary, Alberta ______
Attention: Surface Land
Fax: (403) ______
COMPANY B
______
Calgary, Alberta ______
Attention: Surface Land
Fax: (403) ______
(b) All notices, communications and statements required, permitted or contemplated hereunder shall be in writing, and shall be delivered as follows:
(i) by personal service on a Party at the address of such Party set out above, in which case the item so served shall be deemed to have been received by that Party when personally served;
(ii) by facsimile transmission to a Party to the fax number of such Party set out above, in which case the item so transmitted shall be deemed to have been received by that Party when transmitted; or
(iii) except in the event of an actual or threatened postal strike or other labour disruption that may affect mail service, by mailing first class registered post, postage prepaid, to a Party at the address of such Party set out above, in which case the item so mailed shall be deemed to have been received by that Party on the fifth day following the date of mailing.
(c) A Party may from time to time change its address for service or its fax number or both by giving written notice of such change to the other Party.
9. GENERAL
(a) Each of the Parties hereto shall, from time to time and at all times hereafter, do such further acts and execute and deliver all such further deeds and documents as shall be reasonably required in order to fully establish the interests of the Parties hereto.
(b) The terms, covenants and conditions of this Agreement shall be binding upon and shall enure to the benefit of the Parties hereto, and their respective successors and assigns.
(c) This Agreement shall be governed by and interpreted in accordance with the laws of the Province of Alberta and each of the Parties hereto submits to the jurisdiction of the courts of the Province of Alberta for the interpretation and enforcement thereof.
IN WITNESS WHEREOF the Parties hereto have executed this Agreement as of the date first above written.
COMPANY A / COMPANY BPer: ______/ Per: ______
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THE FOLLOWING ____ PAGES COMPRISE SCHEDULE "A" ATTACHED TO AND FORMING PART OF THE SHARED RIGHT-OF-WAY AGREEMENT MADE AS OF ______, 20___ BETWEEN COMPANY A AND COMPANY B