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JAN. -06' 04 (TUE) DB; 29
<br />P. 003
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<br />Part II. TERMS AND CUNUITIUNS
<br />Sec. I. (a) RENTAL RaT>r -Lessee shpt! pqy lessrn' rental
<br />annually and in advance I'nr each acre or fraction thereof dtuing
<br />the cantinunnce of the lease at the rate of $3.00 I'nr vacit Icasc
<br />year.
<br />(h) RENTAI. CREDITS - Renral shall oar ha a•edited
<br />against either production or advance royalties Inr any year.
<br />whialt would hove been uppliad if the lease had not been inoludud
<br />in an 1-M U.
<br />Sec.fi. DOCUMENTS,EVIUENCLtANDINSPECT]ON-A[
<br />such times and in such form as Lessor may preserihc, 1-essee
<br />shall flu•nish demi led s[uemenls showing the amounts and quality
<br />of all products removed and sold from the ]ease, the proceeds
<br />rheretl•c,m, and the amount axed for production purposes or
<br />unavoidably lust.
<br />Sec. 2. (a) PRODUCTTON RUYALTILIS -The royally shall
<br />he B.U percem of [hz value of [he rapt as scr fonh in the
<br />regulations. Roynhies ore due to Lessor [he final day of the
<br />month suecccding the calendar month in whtch the royalty
<br />obligmion accmes.
<br />(h) apvalVCG ROYALTIL+S' - Upan retlucst by the
<br />Lessee, the authorized officer may accept, for a total of nut mart
<br />shun lU yeah, the payment of advance royalties in lieu of
<br />continued operation, consistent with the ret,+uln[iotts. The
<br />advance royalry shall he bawd on a percunl of the value of a
<br />minimum number of tons determined in the manner established
<br />by the ndvanec royalry regn Minns in effect n[ [hc time the T-essee
<br />rzgn[ >-s approval to pay advance royahies in lieu of continued
<br />operation.
<br />Soc. 3. DONDS - Lcssec stroll maintain in the proper ofhce a
<br />leuso bond in thz amount of $3,533,000. The authorized ollicer
<br />may require an increase in [his amount when additional coverage
<br />is determinui appropriate.
<br />Sec, q, Df LIC;ENCE -This lease is suhjce[ to the conditions of
<br />diligent development and roof inucd operatien, except dta[ these
<br />conditions are excused when opemtions under the Icase are
<br />interrupkd by svikes, the elements, or casualticn nut atrributahle
<br />rn theLessez. The lessor, in the public interest, nwy suspend the
<br />uutdirion of continued operation upon payment of advance
<br />royalties in accordance wish the regulations in existence nt [he
<br />lime of the suspension. Lessee shall submit an amended
<br />operation and reclamation plan pursuant to Section 7 of the Ac[
<br />(3U U.S.C. 2U7(cJ within ]years of [he date of modincutiun ur
<br />prior ro approval to commence mining operarinns.
<br />Lcssar reserves the power w assent to or order dte suspension of
<br />the [cans and conditions oFthis lease in aceardance with, lllLC
<br />olio, Section 39 of the Mineral Leasing Act, 30 U.S.C. 209.
<br />Sec. 5. LOFICAI, MINING UNIT (LM11U) - Either upon
<br />ap(,rnvul by the lessor of chc lessee's application or at the
<br />direction uC the lessor, [his Itase 5ha11 beatmc par[ of an L.NILI,
<br />subject w [he provisions set fotth in the regulations. 1'hz
<br />stipulazinns esWbli•shed in nn LML1 approval in el'fen m the ume
<br />of LMU sppraval ur maditicution will supersede dtz relevant
<br />inuonsistem terms of dtis lease so lonb ~ the louse remains
<br />committed to [hc LM1J. If dte T-MU of which this lease is a pan
<br />is dissolved, [he IcaSe .hall then be subject to the Icase [eons
<br />Lessee shall keep open al all rcasongble times for the inspection
<br />of any duly nuthrn'ized officer nl'Lcssor, the tensed premises and
<br />all surface and underground itnptnvements, works, machinery,
<br />ore s[ockpiles, equipment, and ell books, nccoun[s, maps, and
<br />records rclglive lu uperallnnR, surveys, or investigations on rn•
<br />under the !cased Innds.
<br />l.uesee shall allow lessor access to and copying of documents
<br />reasonably necexsary m verify LzsRee compliance with terms and
<br />conditions of the !case.
<br />While this Iznsz remains in effect, information obtained under
<br />[Iris xaction shall be closed In inspection by the public in
<br />accordanez with the Frccdom of Information Action (5 U.S.C.
<br />552).
<br />Sec. 7, DAMAGFiS TO PROPERTY AND CONDUCT OF
<br />OPERATIONS -Lessee shall comply at its own expense wish
<br />all rcusonable orders of the Suretary, respecting diligent
<br />operations, przvznrinn of waste, and protection of other
<br />feanuree9.
<br />Lessee shall not conduct exploration npcrauons, other than
<br />casual use, withnut nn approved exploration plan. All
<br />exploration plans prior m the cotrunencemcm of ruining
<br />operations within an approval mining permit area shall he
<br />submitted w the auchurizcd officer.
<br />Lessee shall carryon all opemrions in ncmrdance with approved
<br />methods and practices as provided in the operating regulations,
<br />having due regard fur the provencien of injury [n life, health, or
<br />prnpurty, and pruvcmion oC waste, damage nr degradation any
<br />land, air, water, cultural, biological, visual, and other rzsourecs,
<br />including mineral dzposic: and formations ni' minentl deposits
<br />not leased hereunder, and to other land uses ur users. LeRSee
<br />shall take measures deem[>i ne«ssary by lessor to accomplish
<br />lheintemofthislcusetetmt. Suehmea»u•esmayincludc,butnol
<br />limited ro, modification ro proposed siting or design nl' Ihril fines,
<br />timing of aperacigns, and speeifica[inns of interim and final
<br />reclamniinn procedures. Leeaor rd6arvo: to i[sell'the ril{hr [o
<br />lease, sell, or otherwise dtspoae of the surface nr other rninera~
<br />deposits in the lands and the right to coutinuu existing uses and t
<br />authorize future u;es upon or in the Iwsed tends, including
<br />issuing Icuszs Fnr mineral deposits oat covered hereunder anti
<br />approving easemenu ur righisrof--way. Lesser shall condition
<br />such uezs to prevanl unnecessary or unreasonalale interference
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