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Form 340612
<br />(Apri119W) UNITED STATES
<br />~rwe,dr xrou DEPARTMENT OF THE INTERIOR
<br />BUREAU OF LAND MANAGEMENT
<br />i
<br />AnrtT L LEASE RIGHTS GtiANTED
<br />Thu law, catered m W by and between the UntTgo STAtra OP AYgatGL hereinafur called Ivor, through she Buruu of Laced Masagemant sac: v.
<br />(Nome and Addressl
<br />National King Coal, Inc.
<br />P.O. Hox 2905
<br />Durango, Colorado 81302
<br />hereinafter called lessee,u cffec¢ve S EP 1 ~99~ . for a period of 20 yearn cad for eo long thereafter as coal is produced is trommareia.
<br />quaactia tram the leased Lads, subject W readjustment of loess terms at the and of the 20tb Jrar year cad sat~b 16Ysar period thereafter.
<br />Sea 1. Thin !caeca issued pttnuaat cad subject b the terms cad provuiotu of the:
<br />® Miasral lands Leering Ass of 1920, Act of February 25. 1920. u amended, 41 Stet 437, 30 US.C.181.28T, hareins[tei rahrrd W u the Aec;
<br />^ Mineral Leaning Ad for Acquired Leads, Act of August 7, 1947, 81 Stet 913, 30 U.S.C. 351.359;
<br />cad W the regal ationn and formal ordan o[ the Secetary of the Interior which are now or hceafler is foeoe, when not ineosdsteas with the eaprta.
<br />and specific provisions herein
<br />Sac. 2. Lessor, in consideration of any bonuses, renu, and royalties W be Dud, and the conditions and oovaneatn b ba observed u herein sat forth
<br />hereby grants and leases W lessee she a=cluaiva right and privilagc b drill for, mine, astraet remove, or othsnrise proeas cad dispose of the cos:
<br />deposits limited to the coal recoverable by underground mining methods from the Dpper Menefee
<br />(coal bed 1) in, upon, or under the following lands:
<br />New Mexico Principal Meridian
<br />•
<br />T. 35 N., R. 11 W.,
<br />sec. 31, lot 4. SSisiNFlt. SF.}t5'ti~, and SilYSB3c,
<br />rnntaining 193.08 acres. more or lass, together with the right W eonatrua each works, buildings, plane, •mtetures, equipment cad applianten
<br />cad the right W use ouch on-low rightsof•way which rosy be netwary and convenient in the asesdse of the rights and privileges granted, sabiea u
<br />the conditions herein provided.
<br />PART II. TERMS AND CONDITIONS
<br />See. 1. (a) RENTAL RATE - Lessee shell pry lessor rental annually and
<br />L advents for each acre or fraction Hereof during the trontinuance of
<br />the low at the rate of S 3.00 - for each lease you.
<br />(b) RENTAL CREDITS -Rental shall not be aadited against either
<br />production or advanu royalties [or any you.
<br />Sec. 2 le) PRODUCTION ROYALTIES • The royalty shell be 8.0 per
<br />cent of the value of the coal u net forth ie the reguletioas. Royalties are
<br />due W lessor the final dry of the month cueeesdiag the calendar month
<br />in which the royalty obligation atxrues.
<br />(bl ADVANCE ROYALTIES -Upon request by the !erase, the authorized
<br />officer m.y ntceptlor a Wtsl of not more then 10 yeses, the payment of
<br />advance royalties is lieu of continued operation, eonwtent with the
<br />regulations. The advant•e royalty shall be boned on a percent of the
<br />value of a minimum number of Was determined to the roamer
<br />dtabluhed by the advance royalty regulatiow L eHatt et the time the
<br />lessee requesu approval to pay advance royalties is lieu of continued
<br />- -anon.
<br />. BONDS • Lessee shell maintain in the properolYeea lease bond
<br />.aamount of S5,000.00. The authorized officer may require an
<br />tncreaae in the amount when additional wverega u determined
<br />appropriate.
<br />COAL LEASE
<br />Serial Number
<br />COC 49465
<br />Sec. 4. DILIGENCE • This lease u subject W the onnditioaa of diligen~
<br />development and continued operacoa, ezcept thatthene wnditiona ar.
<br />e:eased when operatims under the !sere are iaterruDted by ctrikes, th.
<br />elemenu, or casualties not stiribunble W the Itasca. The lessor, L the
<br />public interest may auspmd the condition of continued operelion upor
<br />payment of advanoe royalties L accordance with the regulations it
<br />e:utenea at the time of the suspension. Leeses's failure b produce me,
<br />in eommerdal quantities at the and of 10 yeah ahdl terminate the
<br />lease. Leases shall submitan operation and redamstion Dlaa Dursuan,
<br />b Section 7 of the Art not later than 3 Ytaes after lease wuaam
<br />The lessor reserves Iha power W want W or order the wapaasion of the
<br />terms and conditiotu of this levee io accordance with, inur alia
<br />Section 39 of the Mineral Lasing Act, 30 U.S.C. 209.
<br />5x S. LOGICAL MINING UNR (LMU) • Either upon approvd by the
<br />lessor of the !canes i apptiudoa or at the ditxtioa of the lessor, chi:
<br />.ease shall betrome an LMU or partof an L.MU, subject W the provision
<br />„et forth is Na reguLtioaa
<br />The stipulations establuhed L to LNU approval in effect at the time .
<br />LNU approval will supersede the relevant inconsistent terms of tt.
<br />!erne w long u the leas remains committed b the 1MU. If the Lst U
<br />which the lease v • pert u dissolved, the lease shell then be subject
<br />the lease terms which would have been applied if th :lease had nut bee.
<br />included L m I.MU.
<br />
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