UNIT'-') STATES I
<br />DEPARTMEi\ JF THE INTERIOR
<br />r BUREAU OF LAND MANAGEMENT Serial Number: COC -0-023703-01
<br />LEASE
<br />PART I. LEASE RIGHTS GRANTED
<br />Lease Date: March 01, 1963
<br />This lease, entered into by and between the UNITED STATES OF AMERICA, hereinafter called lessor, through the Bureau of
<br />Land Management (BLM), and
<br />Blue Mountain Energy, Inc.
<br />10714 S Jordan Gateway #300
<br />South Jordan, UT 80495
<br />hereinafter called lessee, is readjusted, effective March 01, 2013, for a period of 10 years and for so long thereafter as coal is
<br />produced in commercial quantities from the leased lands, subject to readjustment of lease terms at the end of each 10 -year
<br />period thereafter.
<br />Sec. 1. This lease readjustment is issued pursuant and subject to the terms and provisions of the Minerals Lands Leasing Act of
<br />1920, Act of February 25, 1920, as amended, 41 Stat. 437, 30 U.S.C. 181-287, hereinafter referred to as the Act; and to the
<br />regulations and formal orders of the Secretary of the Interior which are now or hereafter in force, when not inconsistent with the
<br />express and specific provisions herein.
<br />Sec. 2. Lessor, in consideration of any bonuses, rents, and royalties to be paid, and the conditions and covenants to be observed
<br />as herein set forth, hereby grants and leases to lessee the exclusive right and privilege to drill for, mine, extract, remove, or
<br />otherwise process and dispose of the coal deposits in, upon, or under the following described lands:
<br />T. 2 N., R. 101 W., 6th P.M.
<br />sec. 1, lots 3 and 4, S'/sNW'/4, and SW%a;
<br />sec. 2, lots 1 to 4, inclusive, S%zN'/z, and SE'/4;
<br />sec. 3, lots 1 to 4, inclusive, S%N'/2, and SW'/<;
<br />sec. 4, lots 1 to 4, inclusive, S'/zN%z, and S%.
<br />T. 3 N., R. 101 W., 6th P.M.
<br />sec. 32, S'/:SE%4;
<br />sec. 33, S% S%z;
<br />sec. 34, S''/, S%s;
<br />sec. 35, S%sN'/ZSE'/4, and S'/z S'/2;
<br />sec. 36, S%zSW'/4.
<br />containing 2,597.22 acres, more or less, together with the right to construct such works, buildings, plants, structures, equipment
<br />and appliances and the right to use such on -lease rights-of-way which may be necessary and convenient in the exercise of the
<br />rights and privileges granted, subject to the conditions herein provided.
<br />PART II. TERMS AND CONDITIONS
<br />Sec. 1. (a) RENTAL RATE - Lessee must pay lessor rental
<br />Sec. 2. (a) PRODUCTION ROYALTIES - The royalty will
<br />annually and in advance for each acre or fraction thereof
<br />be 12.5 percent of the value of the coal for surface mining,
<br />during the continuance of the lease at the rate of $3.00 for
<br />and 8.0 percent of the value of the coal for underground
<br />each lease year.
<br />mining as set forth in the regulations. Royalties are due to
<br />lessor the final day of the month succeeding the calendar
<br />(b) RENTAL CREDITS - Rental will not be credited
<br />month in which the royalty obligation accrues.
<br />against either production or advance royalties for any year.
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