§ 5-333 — Validity of oil, gas or mineral land leases

§ 5-333. Validity of oil, gas or mineral land leases. 1. Any oil, gas\nor mineral land lease given on land situated in this state shall be\ndeemed to incorporate subdivisions two and three of this section and any\nprovisions to the contrary shall be void and unenforceable.\n 2. Any oil, gas or mineral land lease which provides for delay rental\npayments, such payments being periodic payments to the lessor for the\nright to delay drilling or excavation upon the leased property, shall\nprovide that the first such payment shall be due and payable no later\nthan one hundred eighty days after the effective date of the lease. Any\nbonus or up front payment made by the lessee equal to or greater than\nthe first delayed rental payment shall constitute compliance with this\nsubdivision.\n 3. Any oil, gas or mineral land lease shall contain a statement\nadvising the lessor of the provisions of section 15-304 of this chapter.\nSuch statement shall be printed in at least ten point bold type and\nshall read as follows:\n IF THIS LEASE BECOMES FORFEITED, TERMINATED OR EXPIRES, THE LESSEE, OR\nIF THE LEASE HAS BEEN ASSIGNED, THE ASSIGNEE IS REQUIRED TO PROVIDE A\nDOCUMENT CANCELLING THE LEASE AS OF RECORD, AT NO COST TO THE CURRENT\nLANDOWNER. IF THE LESSEE OR ASSIGNEE FAILS TO CANCEL THE LEASE, THE\nCURRENT LANDOWNER MAY COMPEL A CANCELLATION PURSUANT TO SECTION 15-304\nOF THE GENERAL OBLIGATIONS LAW.\n 4. For the purposes of this section, the term "mineral" shall not\ninclude salt, as defined by subdivision eighteen of section 23-0101 of\nthe environmental conservation law.\n 5. On or after January first, two thousand six, any oil or gas lease\nshall contain the following statement printed in at least ten point bold\ntype:\n THIS IS A LEASE OF OIL AND GAS RIGHTS, NOT A SALE, CONTAINING TERMS\nTHAT MAY BE NEGOTIATED BY YOU. YOU HAVE THE RIGHT TO CANCEL THIS LEASE\nWITHIN THREE BUSINESS DAYS AFTER EXECUTION OF THE LEASE BY NOTIFYING THE\nLESSEE THAT YOU HAVE CANCELED THIS CONTRACT. IN ORDER TO CANCEL THIS\nLEASE, YOU MUST EXECUTE A NOTICE OF CANCELLATION IN THE FORM PROVIDED\nBELOW, MAIL IT TO THE LESSEE AND REFUND ALL AMOUNTS PAID TO YOU BY THE\nLESSEE WITHIN THE THREE-DAY CANCELLATION PERIOD. THE MAILING MUST BE\nPOSTMARKED WITHIN THE THREE-DAY CANCELLATION PERIOD TO BE EFFECTIVE.\n NOTICE OF CANCELLATION\n I/WE HEREBY CANCEL THIS LEASE.\n DATED:\n SIGNATURE(S):\n THE PERSON PRESENTING THIS LEASE TO YOU IS [ ] NOT [ ] A MEMBER OF\n (name of organization) AND THEREFORE IS [ ] IS NOT [ ] SUBJECT\nTO A CODE OF CONDUCT. IF THE PERSON PRESENTING THIS LEASE TO YOU IS\nSUBJECT TO A CODE OF CONDUCT, A COPY OF THE CODE OF CONDUCT MUST BE\nPRESENTED TO YOU WITH THIS LEASE. IF APPLICABLE, THE CODE OF CONDUCT\nPROVIDES A DISPUTE RESOLUTION MECHANISM FOR ANY DISPUTE THAT YOU MAY\nHAVE REGARDING THE MANNER BY WHICH THIS LEASE WAS PRESENTED TO YOU. IF\nYOU HAVE ANY SUCH DISPUTE, YOU MAY INVOKE THE DISPUTE RESOLUTION\nMECHANISM OF THE CODE OF CONDUCT BY CONTACTING THE PERSON OR PERSONS\nDESIGNATED IN THE CODE OF CONDUCT. THE FAILURE OF THE LESSEE TO PAY ANY\nROYALTIES TO YOU AS REQUIRED UNDER THE TERMS OF THE LEASE FOR A PERIOD\nOF FOUR CONSECUTIVE MONTHS OR MORE SHALL BE A DEFAULT UNLESS OTHERWISE\nPROVIDED BY LAW, AND WILL RESULT IN CANCELLATION OF THE LEASE APPLICABLE\nTO THE TARGET FORMATION OF THE WELL WITHIN THE SPACING UNIT, FOLLOWING\nWRITTEN NOTIFICATION TO THE LESSEE OF YOUR INTENT TO CANCEL AND SIXTY\nDAYS FOR THE LESSEE TO CURE THE DEFAULT. IF THE LESSEE HAS A BONA FIDE\nDISPUTE REGARDING THE GROUNDS FOR CANCELLATION, SUCH DISPUTE AND THE\nREASONS THEREFOR MUST BE PROVIDED TO YOU IN WRITING OR THE DEFAULT MUST\nBE CURED WITHIN SUCH SIXTY DAY PERIOD, OTHERWISE THE LEASE SHALL BE\nCANCELLED.\n 6. The provisions of subdivisions one, two, three and four of this\nsection shall apply to leases entered into on or after January first,\nnineteen hundred eighty-five and the provisions of subdivision five of\nthis section shall apply to leases entered into on or after January\nfirst, two thousand six.\n