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that this Lease is subject to surface patents, deeds, and certificates of purchase, and Lessee shall assume <br />responsibility for all claims azising from damages to the surface above the Leased Premises caused by <br />Lessees operations. <br />22. N~LD NARMLESS -Lessee shall indemnify Lessor against all liability and loss, and against all claims and <br />actions, including the defense of such claims or anions, based upon or arising out of damage or injury, <br />including death, to persons or property caused by of sustained in connenion with this lease or by conditions <br />created thereby, or based upon any violation of any statute, ordinance, or regulation. <br />23. BOND - It is agreed that no operations are to be commenced on the Leased Premises unless and until Lessee <br />of Lessee's agent has filed a good and sufficient bond with Lessor in an amount fixed by Lessor, to secure <br />the payment for damages caused by Lessee's or Lessee's agent's operations on said lands.. Lessor reserves <br />the right to grant relief from the foregoing bond requirements. Lessor may require the bond to be held in <br />full force and effect for one year after cessation of operations for which the bond was intended. Thin <br />requirement may be waived in favor of the requirements of the Division of Minerals and Geology. <br />24. COAL A!IINE GAS -Methane gas or other volatile gases produced, saved and/or sold by the coat mining <br />Lessee from mineable coal measures and from roofs and floors of mineable coal measures shall be the <br />property of that Lessee provided that the gas is removed as a mining safety procedure prior to mining and <br />that a royalty be paid to Lessor per the terms set forth in Lessor's then current oil and gas leases. Gas that <br />is uneconomical to produce may be vented or dared provided that.the venting or flaring complies with all <br />federal, state and local requirements. Methane gas or other volatile gases produced by the oil and gas lessees <br />from the mineable coal measures and from roofs and floors of mineable coal measures prior to mining shall <br />be the property of the oil and gas lessee under the terms of the ail and gas lease, so long as the terms in this <br />paragraph are consistent within the law. "Roof" means the rock immediately above and in wntaet with the <br />mineable coal measure. "Floor" means the rock immediately below and in contact with the mineable coal <br />measure. <br />25. WATER R]G}lTS - ]f Lessee initiates or establishes any water right where the point of diversion or <br />groundwater withdrawal is on the Leased Premises and where the siiKace is owned by the State, such water <br />right must be obtained in the name of and with the consent of the State acting by and through its Board of <br />Land Commissioners. <br />Water rights and any improvement required to bring this water to the surface shall become the property <br />of the State, without cost, upon termination of this lease for any cause whatsoever. <br />Under no circumstance may ground water be withdrawn without first having secured the permission <br />of Lessor and may not be withdrawn at a rate higher than necessary for the mining and/or processing of State <br />minerals only. Additional payment may be required for the use of any waters as may be defined as tributary <br />or non-tributary. <br />26. LIENS AND CLAIMS -Lessee shall not suffer or permit to be enforced against the Leased Premises, or <br />any part thereof, or any improvements thereon, any liens arising from, or any claim for damage growing out <br />of the work of any construction, repair, restoration, replacement or improvement, or any other claims trr <br />demand howsoever the same may arise, but Lessee shall pay or cause to be paid all of said liens, claims, or <br />demands before any action is brought to enforce the same against the Leased Premises or improvements: <br />Lessee agrees to defend, indemnify and hold Lessor and the Leased Premises free and harmless from all <br />liability for any and all such liens, claims, demands, and anions together with reasonable attorney fees and <br />all vests and expenses in connection therewith. <br />Lessee shall, upon execution of this lease at its cost, prepare a Notice, pursuant W C.R.S. § 38-22-105 <br />and cause the same to be posted for the purpose of protecting Lessor against any liens or encumbrances upon <br />the Leased Premises by reason of work, labor, services or materials contraned for or supplied to Lessee. <br />Page ,~ of <br />