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Form of hold.

put.

leased shall be conformed to and taken in accordance
with the legal subdivisions of such survey; deposits
made to cover expense of surveys shall be deemed appro-
priated for that purpose; and any excess deposits shall
be repaid to the person, association, or corporation
making such deposits or their legal representatives:
Provided, That the land embraced in any one lease proviso.
shall be in compact form, the length of which shall not inte
exceed two and one half times its width.

Sec. 11. That for the privilege of mining or extracting Royalties to be the phosphates or phosphate rock covered by the lease the lease. lessee shall pay to the United States such royalties as may be specified in the lease, which shall be fixed by the Secretary of the Interior in advance of offering the same, which shall be not less than 2 per centum of the gross value of the output of phosphates or phosphate rock at the mine, due and payable at the end of each Amount on outthird month succeeding that of the sale or other disposition of the phosphates or phosphate rock, and an annual rental payable at the date of such lease and an- Annual rental. nually thereafter on the area covered by such lease at such rate as may be fixed by the Secretary of the Interior prior to offering the lease, which shall be not less than 25 cents per acre for the first year thereafter, 50 cents per acre for the second, third, fourth, and fifth years, respectively, and $1 per acre for each and every year Rental credited thereafter during the continuance of the lease, except against royalties. that such rental for any year shall be credited against the royalties as they accrue for that year. Leases shall be for indeterminate periods upon condition of a minimum annual production, except when operation shall be interrupted by strikes, the elements, or casualties not attributable to the lessee, and upon the further condition that at the end of each twenty-year period succeeding the date of the lease such readjustment of terms and conditions shall be made as the Secretary of the Interior shall determine unless otherwise provided law at the time of the expiration of such periods: Pro- Proviso. vided, That the Secretary of the Interior may permit pension of oper: suspension of operation under such lease for not exceed-ations to avert ing twelve months at any one time when market conditions are such that the lease can not be operated except at a loss.

Sec. 12. That any qualified applicant to whom the cor development Secretary of the Interior may grant a lease to develop works, etc., aland extract phosphates, or phosphate rock, under the provisions of this Act shall have the right to use so much of the surface of unappropriated and unentered lands, not exceeding forty acres, as may be determined by the Secretary of the Interior to be necessary for the proper prospecting for or development, extraction, treatment, and removal of such mineral deposits.

Period indeter. minate.

Conditions.

loss.

lowed.

Oil and gas de posits.

OIL AND GAS.

tields.

tions.

Location.

Exclusive pros. SEC. 13. That the Secretary of the Interior is hereby for, authorized. authorized, under such necessary and proper rules and

regulations as he may prescribe, to grant to any applicant qualified under this Act a prospecting permit, which shall give the exclusive right, for a period not exceeding two years, to prospect for oil or gas upon not to exceed two thousand five hundred and sixty acres of

land wherein such deposits belong to the United States Not within and are not within any known geological structure of a known producing

producing oil or gas field upon condition that the perDrilling condi- mittee shall begin drilling operations within ‘six

months 12 from the date of the permit, and shall, within one year from and after the date of permit drill one or more wells for oil or gas to a depth of not less than five hundred feet each, unless valuable deposits of oil or gas shall be sooner discovered, and shall, within two years from date of the permit, drill for oil or gas to an aggregate depth of not less than two thousand feet unless

valuable deposits of oil or gas shall be sooner discovered. Time extension The Secretary of the Interior may, if he shall find that of permits.

the permittee has been unable with the exercise of diligence to test the land in the time granted by the permit, extend any such permit for such time, not exceeding two years, and upon such conditions as he shall prescribe.

Whether the lands sought in any such application and On surveyed

permit are surveyed or unsurveyed the applicant shall, prior to filing his application for permit, locate such lands in a reasonably compact form and according to

the legal subdivisions of the public land surveys if the Notice, etc., of land be surveyed; and in an approximately square or unsurveyed lands. rectangular tract if the land be an unsurveyed tract, the

length of which shall not exceed two and one-half times its width, and if he shall cause to be erected upon the land for which a permit is sought a monument not less than four feet high, at some conspicuous place thereon, and shall post a notice in writing on or near said monument, stating that an application for permit will be made within thirty days after date of posting said notice, the name of the applicant, the date of the notice, and such a general description of the land to be covered by such permit by reference to courses and distances from such monument and such other natural objects and

permanent monuments as will reasonably identify the Issue of permit. Iand, stating the amount thereof in acres, he shall during

the period of thirty days following such marking and

posting, be entitled to a preference right over others Corner marks, to a permit for the land so identified. The applicant etc. on reserved shall, within ninety days after receiving a permit, mark

each of the corners of the tract described in the permit upon the ground with substantial monuments, so that the

lands,

12 Time may be extended; see the act of Jan, 11. 1922.

Provisos.
Drilling peri-

Preferere

to

boundaries can be readily traced on the ground, and shall post in a conspicuous place upon the lands a notice that such permit has been granted and a description of the lands covered thereby: Provided, That in the Territory of Alaska prospecting permits not more than five

ods, etc., in Alasin number may be granted to any qualified applicant ka. for periods not exceeding four years, actual drilling operations shall begin within two years from date of permit, and oil and gas wells shall be drilled to a depth of not less than five hundred feet, unless valuable deposits of oil or gas shall be sooner discovered, within three years from date of the permit and to an aggregate depth of not less than two thousand feet unless valuable deposits of oil or gas shall be sooner discovered, within four years from date of permit: Provided further, That in said Territory the applicant shall have a prefer- first locators. ence right over others to a permit for land identified by temporary monuments and notice posted on or near the same for six months following such marking and posting, and upon receiving a permit he shall mark the corners of the tract described in the permit upon the ground with substantial monuments within one year after receiving such permit.

Sec. 14. That upon establishing to the satisfaction of Lease to perthe Secretary of the Interior that valuable deposits of erittee on discovoil or gas have been discovered within the limits of the land embraced in any permit, the permittee shall be entitled to a lease for one-fourth of the land embraced in the prospecting permit: Provided, That the permittee Provisos. shall be granted a lease for as much as one hundred and sixty acres of said lands, if there be that number of acres within the permit. The area to be selected by the permittee, shall be in compact form and, if surveyed, to be surveyed land. described by the legal subdivisions of the public-land surveys; if unsurveyed, to be surveyed by the Government at the expense of the applicant for lease in accord - applicants in pay ance with rules and regulations to be prescribed by the Secretary of the Interior and the lands leased shall be conformed to and taken in accordance with the legal subdivisions of such surveys; deposits made to cover expense of surveys shall be deemed appropriated for that purpose, and any excess deposits may be repaid to the person or persons making such deposit or their legal representatives. Such leases shall be for a term of twenty Term, royalty, years upon a royalty of 5 per centum in amount or value of the production and the annual payment in advance of a rental of $1 per acre, the rental paid for any one year to be credited against the royalties as they accrue for that year, with the right of renewal as prescribed in section 17 hereof. The permittee shall also be entitled to a preference right to a lease for the remainder of the land in his prospecting permit at a royalty of not prospected area. less than 124 per centum in amount or value of the pro

Limit.

Minimun.

Selection of

If unsurveyed,

and rental.

+

Preference for remainder of

Minimum roy. alty, etc.

for lease.

Forfeiture for

duction, and under such other conditions as are fixed for oil or gas leases in this Act, the royalty to be determined

by competitive bidding or fixed by such other method Biacing condi as the Secretary may by regulations prescribe: Provided, tion.

That the Secretary shall have the right to reject any

or all bids. Payment for Sec. 15. That until the permittee shall apply for lease product secured before applying to the one quarter of the permit area heretofore provided

for he shall pay to the United States 20 per centum of the gross value of all oil or gas secured by him from the lands embraced within his permit and sold or otherwise

disposed of or held by him for sale or other disposition. Drilling restric- Sec. 16. That all permits and leases of lands containtions.

ing oil or gas, made or issued under the provisions of this Act, shall be subject to the condition that no wells shall be drilled within two hundred feet of any of the outer boundaries of the lands so permitted or leased, unless the adjoining lands have been patented or the title thereto otherwise vested in private owners, and to the further condition that the permittee or lessee will, in

conducting his explorations and mining operations, use Prevention of all reasonable precautions to prevent waste of oil or gas waste, etc.

developed in the land, or the entrance of water through

wells drilled by him to the oil sands or oil-bearing strata, violations.

to the destruction or injury of the oil deposits. Violations of the provisions of this section shall constitute grounds for the forfeiture of the permit or lease, to be enforced through appropriate proceedings in courts of competent jurisdiction.

SEC. 17. That all unappropriated deposits of oil or appropriated de posits" in known gas situated within the known geologic structure of a producing fields. producing oil or gas field and the unentered lands con

taining the same, not subject to preferential lease, may

be leased by the Secretary of the Interior to the highest Competitive responsible bidder by competitive bidding under general

regulations to qualified applicants in areas not exceeding Areas limited. six hundred and forty acres and in tracts which shall

not exceed in length tiro and one-half times their width, Payment of such leases to be conditioned upon the payment by the bonus, royalties, and rental. lessee of such bonus as may be accepted and of such

royalty as may be fixed in the lease, which shall not be less than 124 per centum in amount or value of the production, and the payment in advance of a rental of not less than $1 per acre per annum thereafter during the continuance of the lease, the rental paid for any one year

to be credited against the royalties as they accrue for Period of leases ; that year. Leases shall be for a period of twenty years,

Leases of un.

bidding

with the preferential right in the lessee to renew the same for successive periods of ten years upon such reasonable terms and conditions as may be prescribed by the Secretary of the Interior, unless otherwise provided

by law at the time of the expiration of such periods. Reduction of Whenever the average daily production of any oil well 11.yalty for small production.

shall not exceed ten barrels per day, the Secretary of the

renewals.

all leases,

Withdrawn oil

Interior is authorized to reduce the royalty on future production when in his judgment the wells can not be successfully operated upon the royalty fixed in the lease. The provisions of this paragraph shall apply to all oil Applicable to and gas

leases made under this Act. Sec. 18. That upon relinquishment to the United States, filed in the General Land Office within six months or gas lands.

Leases, on surafter the approval of this Act, of all right, title, and in- render of rights, terest claimed and possessed prior to July 3, 1910, and ants under min. continuously since by the claimant or his predecessor in ing laws having interest under the preexisting placer mining law to any oil or gas bearing land upon which there has been drilled one or more oil or gas wells to discovery embraced in the Executive order of withdrawal issued September 27, 1909, and not within any naval petroleum reserve, and upon payment as royalty to the United States of an

Payment for

oil produced. amount equal to the value at the time of production of one-eighth of all the oil or gas already produced except oil or gas used for production purposes on the claim, or unavoidably lost, from such land, the claimant, or his successor, if in possession of such land, undisputed by any other claimant prior to July 1, 1919, shall be entitled Period of lease : to a lease thereon from the United States for a period of twenty years, at a royalty of not less than 12 per centum of all the oil or gas produced except oil or gas used for production purposes on the claim, or unavoidably lost: Provided, That not more than one-half of the area, but in no case to exceed three thousand two hundred acres, within the geologic oil or gas structure of a producing oil or gas field shall be leased to any one claimant under the provisions of this section when the area of such geologic oil structure exceeds six hundred and forty acres. Any claimant or his successor, subject to this limitation, shall, however, have the right to select and re- lowed. ceive the lease as in this section provided for that portion of his claim or claims equal to, but not in excess of, said one-half of the area of such geologic oil structure, but not more than three thousand two hundred acres.

All such leases shall be made and the amount of royalty to be paid for oil and gas produced, except oil or etcive to be pre

scribed gas used for production purposes on the claim, or unavoidably lost, after the execution of such lease shall be fixed by the Secretary of the Interior under appropriate rules and regulations: Provided, however, That as to all like claims situate within any naval petroleum re

Naval petrole. serve the producing wells thereon only shall be leased, ing restrictions. together with an area of land sufficient for the operation thereof, upon the terms and payment of royalties for past and future production as herein provided for in the leasing of claims. No wells shall be drilled in the land subject to this provision within six hundred and sixty feet of any such leased well without the consent of the

36039-23

Proviso.

Area limited to one claimant.

Slection al.

Regulations,

Provisos.

um reserve leas.

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