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<br />e <br /> <br />e <br /> <br />-3- <br /> <br />the value of same at the well at the option of' the permittee; or <br />(2) to treat his interest as a royalty interest interest and re- <br /> <br />ceive, delivered free of cost in the pipe line to which the well I <br /> <br />rr..ay be connected, a share of all oil pl"oduc ed and saved from 8uc1;1 <br />I <br />well equal to one-eighth (1/8l of the pl"oportton of the whole I <br /> <br />quantity of oil so produced and saved that the number of squar'e feet <br /> <br />i.n the area owned by him bears to the number of square feet in <br /> <br />such drilling block, or at the election of permittee to receive <br /> <br />such proprotion of the value at the well of the oil so produced, <br />and to receive a like proportion of the gas and casinghead gas <br />produced, saved and utilized or sold, or at the election of per- <br />mittee the value at the well of such proportion of gas or casing- <br />head gas produced, saved and utilized or sold, or at the election <br />of permittee the value at the well of such proportion of gas or <br /> <br />casinghead gas produced, saved and utIlized or sold. If any owner <br />does not exercise the rights and option above provided, the obli- <br /> <br />gat ion shall then be upon the permittee, his heirs, successors <br /> <br />and assigns, to malce settlement with such owner on the terms pro- <br />vided in Option 2 above, providing for the payment of a one-eighth <br />'.' .;" (~/8) royalty. If the owner of a lot or lots, block or blocks, <br /> <br />- ....~~.,~ :.. , <br /> <br />~ract or tracts, shall exercise Option 1 above IOd treat his in- <br />terest as a working interest, as therein provided, the permittee <br />shall be entitled to reimburse himself for such owner's propor- <br /> <br />\I) <br /> <br />tionate part of the costs out of such owner's propoertionate part <br />of the oil, gas and casinghead gas or the value thereof before <br />making deliveries of products or settlement for the value thereof. <br /> <br />If Option 1 is exercised by the owner of any lot or lots, block <br />o.r blocks, tract or tracts, such owner shall, within the time pro- <br />vided for notice of such election above set forth, file with the <br /> <br />City Clerk a bond or other obligation executed by such owner as <br /> <br />principal and by an authorized surety co~pany as surety, in which <br />such principal and surety agree, bind and obligate themselves to <br />pay to the permittee, his heirs, successors and assigns currently <br />each month that proportion of the actual and necessary costs and <br /> <br />I <br />.1 <br />