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UNITED STATES
<br />DEPARTMENT OF THE INTERIOR Serial NumberC 0_8199
<br />HUREAi7 OF UM MANAGEMMT
<br />Lease Date -Oly J,_12§_3
<br />COAL LEASE READJUSTMENT
<br />PART 1. LEASE RIGHTS GRANTED
<br />This lease, entered into by and between the UNITED STATES OF AMERICA, hereinafter called lessor,
<br />through the Bureau of. Land Management, and
<br />Seneca Coal Company
<br />701 Market Street
<br />St.. Louis, Missouri 63101-1826
<br />hereinafter called lessee, is readj•isted, effective July 1, 2003, for a period of 10 years and for so
<br />long. thereafter as coal is produced in commercial quantities from the leased lands, subject to
<br />readjustment of lease terms at the end of each 10-year lease period.
<br />Sec.l. 'This lease readjustment is issued pursuant and subject to the terms and provisions of the
<br />Mineral Lands Leasing Act of 1920, Act-of February 25, 1920, ad amended, 41 stat. 437, 30 U.S.C. 181-
<br />887, hereinafter referred to as the Act;
<br />and to the regulations and formal orders of the secretary of the Interior which are now or hereafter in
<br />force, when not inconsistent with tae express and specific provisions herein.
<br />Sec.2. Lessor, in consideration of any rents, and royalties to be paid, and the conditions and
<br />covenants to be observed as herein set forth, hereby grants to lessee the exclusive right and privilege
<br />to, drill for, mine, extract, remove, or otherwise process and dispose of the coal deposits in, upon, or
<br />under the .following described lands:
<br />T. •6 N., R. 87 W., 6.`?P.M.
<br />sec. 21, E1/2NW1/4, and SW1/4;
<br />sec. 22, E1/2E1/2;
<br />sec. 27, W1/2E1/2NE',G, NW1/*M114, W1/2NW1/4, and SE11481/4;
<br />sec. 28, E1/2NE1/4, SW1/4NE1/4, W1/2, and W1/2SE1/4;
<br />sec. 32, E1/2NE114;
<br />sec. 33, N112, E1/2S11/4, and SE114;
<br />sec. 34, NE1/4NE1/4, NW1/4NW1/4, S1/2W1/4, SW1/4, and W1/2S81/4;
<br />sec. 35, NE1/4NW1/4, and W1/2W1/4.
<br />containing 2,280.00 acres, more or :Less, together with the right to construct such works, buildings,
<br />plants, structures, equipment and appliances and the right to use such on-lease rights-of-way'which may
<br />be necessary and convenient in the exercise of the rights and'privilegas granted, subject to the
<br />conditions herein ptovided.
<br />PART II. TERMS AND CONDITIONS
<br />Sec.l. (a) RENTAL RATE - Lessee shall pay lessor
<br />rental annually and in advance for each acre or
<br />fraction thereof during the continuance of the
<br />lease at the rate of $3.00 for each lease year.
<br />(b) RENTAL CREDITS - Rental shall not be
<br />credited against either production or advance
<br />royalties for any year.
<br />Sec.2. (a)PRODUCTION RO - The royal
<br />shall be 1 percent of the value of the coal
<br />produced by strip or -auger methods and 8.0
<br />percent of the value of the coal produced by
<br />underground mining methods as set forth in the
<br />regulations. Royalties are due to lessor the
<br />final day of the month succeeding the calendar
<br />month in which the royalty obligation accrues.
<br />'(b) ADVANCE ROYALTIES - Upon regs.est by the
<br />lessee, the authorized offider may a•acept, for a
<br />total of not more than 10 years, the payment of
<br />advance royalties in lieu of continued
<br />operation, consistent with the regulations. The
<br />advance.royalty shall be based on a percent of
<br />the value of a i :Lnim% +•numbsr of tons determined
<br />in the manner established by the advance royalty
<br />regulations in effect at the time the lessee
<br />requests approval to Ray advance royalties in
<br />lieu of continued operation.
<br />Sec.3. $ONDS - Lessee shall maintain in the
<br />proper office a lease bond in the amount of
<br />$7,000. The authorized of Ricer may require an
<br />is determined appropriate.
<br />Sec.4. DILIGENCE - The lessee is subject to the
<br />conditions of diligent development and continued
<br />operations, except that these conditions are
<br />excused when operations under the lease are
<br />interrupted by strikes, the elements; or
<br />casualties not attributable to the lessee. The
<br />lessor in the public interest, may•suepend the
<br />conditions of continued operation upon payment
<br />of advance royalties in accordance with the
<br />regulations in existence at the time of the
<br />suspension. Lessee's failure to produce coal in
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