§ 64-1066 — Community oil and gas lease.

The lease contract of the state, with any lessee for oil and gas purposes, shall stipulate, and the advertisement for bids for leasing such land shall specify a fixed royalty, to be determined by the commissioners of the land office, and in no event less than twelve and one-half percent (12 1/2%) of the total output of such oil and gas, and in addition thereto any bonus offered for such lease, and shall also require a deposit of sufficient earnest money in the hands of the commission as the commission may require to accompany each bid, with appropriate conditions of forfeiture for failure to comply with the terms and conditions of bidding upon such lands. All leases for oil and gas provided in this article shall contain a provision requiring the lessee to drill a sufficient number of wells upon the leased premises to offset the wells upon adjoining contiguous premises, and a further provision that a failure to faithfully operate the leased premises for oil and gas to as full an extent as individual and corporate premises are being operated within the general oil and gas field, where such land is located, shall forfeit such lease to the state. No transfer or assignment of any lease shall be valid or convey any right in the assignee without the consent in writing of the commissioners of the land office. The board of commissioners may make such additional rules that are determined necessary to enforce the provisions of this article. Provided, the commissioners of the land office shall have authority to enter into agreements upon such terms and conditions as they may impose, providing for the communitizing of any oil and gas lease executed by them with other leases to be jointly operated and developed as a unit when they deem such communitization to be to the best interest of the funds and property under their management. This provision shall apply to existing leases as well as to leases to be entered into hereafter. (The word "communitizing" or "communitization", as used herein shall be defined as a combining of diverse interests or interests owned by different parties in lands and minerals on an area for a common development for oil and gas purposes so that such area may be considered as a unit or a whole.)

Legislative History

R.L. 1910, § 7198. Amended by Laws 1941, p. 304, § 1, emerg. eff. May 1, 1941; Laws 1997, c. 118, § 2, eff. July 1, 1997. Renumbered from § 285 of this title by Laws 2010, c. 41, § 118, emerg. eff. April 2, 2010.