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cUR ~ ant • ..':; y.~~,.i;; <br />Form 3J00~1.' OOL~. ~ i;= i .'_'•~~t P <br />(April 19841 UNITED STATES Serial Number <br />,r~~oar.,.:uml~ DEPARTMENT OF THE INTERIOR~j <br />BUREAU OF LAND MANAGEMEN"Y3 C`-C 14 A 9 =00 COC 53560 <br />COAL LEASE <br />PART I. LEASE RIGHTS GRANTED <br />This lease, entered into by and between the UNlreo Sr.tres of ANelucA. hereinafter called lessor, through the Bureau of land Management. and <br />(Name and Address <br />Cyprus Western Coal Company <br />9100 East Mineral Circle <br />Englewood, Colorado 80155 <br />hereinafter called lessee, ie effective ldatel~ 1 1994, for a period of 20 years and for eo long thereafter as roal is produced in rnmmercial <br />quantities from the leaned lends, subject to readjustment of lease terms et the end of the 20th lease year and each 10.year penod thereafter. <br />Sec. 1. Thin Issas ie issued pursuant and subject to the retina end provisions of the: <br />® Minerel Lands Leasing Act of 192J. Act of February 25, f920, as amended. 41 StaL 437, 30 U.S.C. 181.287, hereinafter referred to ae the Act: <br />^ Mineral Leasing Act for Acquired Lends, Act of August 7, 1947, 6I Stat. 913, 30 U.S.C. 351.359; <br />and to the regulations and formal order of the Secretary of the Interior which ere now or hercaNar in force, when no[ inroneismnt with the express <br />end specific provisions harem. <br />Sec. 2. Lessor, in consideration of any bonuses, rents, end royalties m be Daid, and the ronditioas sad rovenants m beobcerved u herein set forth. <br />hereby Brenta and leases to lessee the ezcluaive right sad privilege m drill for. mine, eztraa, remove, or ocherwtee process and dispose of the roal <br />hmds:deposits limited to the coal recoverable by underground <br />mining methods in the Wadge seam in the following lands: <br />Sixth Principal Meridian <br />T. 5 N., R. 86 W., <br />sec. 31, lots 1, 2, YB~NF'i.,, and E~NW',,. <br />T. 5 N., R. 87 W., <br />sec. 36, lots 1, 2, [?-~NE'~,., and NWT. <br />containing 544.08 acres, more or leas, together with the right to construct each works, buildings, pleats, structures, equipment and appliances <br />and the nght to use ouch on-7 ease rightsof-way which may be ostensory and convenient in the ezermse o[ the righu and privileges granted, subject to <br />the conditions hewn provided <br />PART II. TERMS AND CONDITIONS <br />Sec. 1. lei RENTAL RATE - Leeace shall pay lessor rental annually and <br />in advance for each acre orframion thereof during the continuance of <br />the lease at the rate of S --- for each lease year. <br />(bl RENTAL CREDITS -Rental shall not be credited against either <br />production or advance royalties for any year. <br />Sec. 2. (a) PRODUCTION ROYALTIES -The royalty shall be B,Operv <br />cent of the value of the coal ae set forth i n the regulations. Royalties are <br />due to lessor the final day of the month succeeding the calendar month <br />in which the royalty obligation accrues. <br />(bl ADVANCE ROYALTIES -Upon request by the lessee, the authorized <br />officer may accept, for a total of roc more than I O years, the Deyment of <br />advance royeltiea in lieu a(continued operation, consistent wi[h the <br />regulations. The advance royalty shell be based on a patter[ of the <br />value of a minimum number of tone determined in the manner <br />established by the advance royalty regulations in effect at the nine the <br />lenace requests approval to pay edvantt royalties in lieu of continued <br />operation. <br />Sec. 3. BONDS-Lessee shell maintain in the proper officealease bond <br />in the amour t of 5 .The authorized officer may require en <br />increase in this amount when additional coverage is determined <br />amnrooriate. <br />Sec. 4. DILIGENCE -This lease is subject W the roaditione of diligent <br />development and continued operation, except that these rondicons are <br />excused when operations under the lease are interrupted by strikes, the <br />elements, or casualties not attributable to the leases. The lessor, in the <br />public interest, may suspend the rondition of continued operator upon <br />payment of advance royalties in accordance with the regulations in <br />existence at the time of the suspension. Lessee's failure to produce coal <br />in commercial quantities et the end of IO years shall terminate the <br />lease. Lessce shall su bmit as operation end reclamation Dlan puxnuant <br />to Section 7 of the Act not later than 3 years after lease issuance. <br />The lessor reserves the power to assent w or order the euepeneion o(the <br />terms end conditions of this leans in accordance with, inter alia. <br />Section 39 of the Mineral Leasing Act, 30 U.S.C. 209. <br />Sec. 5. LOGICAL MINING UNIT (LMU) -Either upon approval by the <br />lessor of the lessee's application or at the direction o[ the lessor, this <br />lease shell berome an LMU or par oC an LMU, subject b the provisions <br />set forth in the regulations. <br />The stipulations established in an LMU eDProval in effect at the time of <br />LMU approval will supereede the relevant inromiatent [eons of this <br />lease eo long ee the lease remains rommicted to the LMU. If the LM U of <br />which this lease u a part is dwolved, the lease shall then be subject to <br />the lease tense which would have been applied if the lease had not been <br />included in an LMU. <br />