31 Tex. Admin. Code § 10.4 - Exploration and Mining Leases for Minerals Subject to Sealed Bid
(a) Lands and minerals subject to lease.
Generally, coal, lignite, sulphur, salt, and potash on PSF lands and all
minerals on state agency lands are subject to lease by sealed bid. See §
10.1 of this title (relating to
Definitions; Exploration and Development Guide) for lands and minerals which
are subject to lease under these sealed bid procedures and §
10.2(b) of this
title for other minerals that may be leased under the section.
(b) Exploration for certain minerals.
Exploration for coal, lignite, sulphur, salt, and potash on PSF lands may be
conducted under geophysical and geochemical permits issued by the GLO.
Applications must be submitted on forms prescribed by the GLO. (See §
9.11 of this title)
(c) Nomination, advertising, and award of
tracts.
(1) Nominations, setting of terms and
conditions, evaluation of sealed bids, advertising, and awards are administered
by the SLB under Chapter 9 of this title (relating to Exploration and Leasing
of State Oil and Gas).
(2) On land
trade lands, the GLO will notify the surface owner that a lease has been issued
if the surface owner requests such notice in writing by furnishing the GLO with
a current mailing address and a legal description of each tract on which he
desires such notice. Failure of the surface owner to receive notice will not
affect the validity of a lease issued under this section.
(3) TPWD may review the leasing of lands
whose minerals are subject to lease under this section but whose surface is
owned or leased by TPWD or is subject to a conservation easement in favor of
TPWD. If such lands are nominated for lease, the GLO shall notify the executive
director of TPWD of such nomination. On the same day as a lease is issued on
such lands, the TPWD will be notified of the issuance of the lease. Such lease
will state that the surface of such land is owned or leased by TPWD or is
subject to a conservation easement in favor of TPWD and will identify the TPWD
park or area manager who is responsible for the surface of the land.
(d) Minimum terms and conditions.
(1) Terms and conditions of leases will be
set by the SLB for each lease sale and will be included in the notice for
bids.
(2) The royalty reserved to
the state shall be not less than one-eighth of the gross production of sulphur
or the value of the sulphur that may be produced or that may be produced and
sold off the area and not less than one-sixteenth of the value of coal,
lignite, salt, and potash that may be produced.
(3) Upland leases issued under this section
on tracts in which the PSF own the surface must include a provision requiring
the payment of damages for the use of the surface in prospecting for,
exploring, developing, or producing the leased minerals. The amount of damages
for use of the surface will be determined by negotiation with GLO staff,
approved by the commissioner, and incorporated in each lease form.
(4) Lessee shall conduct all mining
operations and reporting requirements in compliance with state and federal laws
and §
10.7 of this title (relating to
Conduct of Exploration and Mining Operations).
(5) State agency leases (except TPWD and TDC
leases) may not be for a primary term exceeding five years.
(e) Assignments, releases,
reports, inspections, forfeitures, and reinstatements. Leases issued under this
section are subject to all general provisions covered in §
10.8 of this title (relating to
Assignments, Releases, Reports, Royalty Payments, Inspections, Forfeitures, and
Reinstatements).
Notes
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