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| Home > Statutes > Usa Arizona |
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USA Statutes : arizona
Title : Minerals, Oil and Gas
Chapter : MINING RIGHTS IN LAND
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27-201 Location of mining claim upon discovery of mineral in place
Upon discovery of mineral in place on the public domain of the United States the
mineral may be located as a lode mining claim by the discoverer for himself, or for
himself and others, or for others.
27-202 Method of locating a lode claim; monument; location notice; amendments
A. Location of a lode claim shall be made by erecting on the surface on the
centerline within the boundaries of the claim a conspicuous monument of stones not less
than three feet in height, or an upright post securely fixed and projecting at least four
feet above the ground, in or on which there shall be posted a location notice, signed by
the name of the locator. The location notice shall contain:
1. The name of the claim located.
2. The name and address of the locator.
3. The date of the location.
4. The length and width of the claim in feet, and the distance in feet from the
location monument to each end of the claim.
5. The general course of the claim.
6. The locality of the claim with reference to some natural object or permanent
monument whereby the claim can be identified and, if known to the locator, the
identification of the section, township and range in which the notice of location of the
claim is posted.
B. Until the requirements of subsection A are complied with, no right of location
is acquired.
C. The notice may be amended at any time and the monument changed to correspond
with the amended location, but no change shall be made which will interfere with the
rights of others. If such amendment changes the exterior boundaries of the claim, a new
or amended map, plat or sketch shall be recorded pursuant to section 27-203 showing such
change.
27-203 Completing lode, placer or millsite locations; recording location notice; monumenting; map, plat or sketch requirements; abandonment of claims; recorder duties and fees
A. The locator of a lode, placer or millsite claim shall:
1. Cause to be recorded in the office of the county recorder of the county in which
the claim is located an executed copy of the location notice to which notice shall be
attached a map, plat or sketch of the claim, within ninety days from the time of the
location. If the posted notice of location does not contain the section, township and
range in which the notice is posted such information shall be added to the notice prior
to recording pursuant to this section if the land has been surveyed. If the land has not
been surveyed, the locator shall identify to the best of his ability the projected,
protracted or extended section, township and range in which the notice of location of the
claim is posted.
2. Monument the claim on the ground within ninety days from the time of the
location so that its boundaries can be readily traced.
B. The map, plat or sketch required by subsection A shall be:
1. In legible form and not more than eight and one-half inches by fourteen inches.
2. On a scale of one inch equals not more than two thousand feet.
3. Based upon the performance of a survey performed commensurate with the abilities
of the locator. It shall set forth the boundaries and position of the claim with such
accuracy as would permit a reasonably knowledgeable person to find and identify the claim
on the ground. The locator may show contiguous claims on the map, plat or sketch if the
claim being located is clearly identified. Nothing contained in this section shall
require a locator to employ a professional surveyor or engineer for the preparation of
the map, plat or sketch required by this section.
C. The plat or map of any claim shall contain the following information:
1. The name of the claim.
2. Whether the claim is a lode, placer or millsite claim.
3. The locality of the claim with reference to the section, township and range in
which the claim is located with a course and distance tie from a corner of the claim or
contiguous group of claims to a monument of the public land survey if the land has been
surveyed. If the land has not been surveyed, a corner of the claim or claim group shall
be tied by course and distance to an established survey monument of a United States
government agency or United States mineral monument. If no such monument can be found
through the exercise of reasonable diligence, the map shall show the course and distance
from one corner of the claim or claim group to some prominent natural objects or other
permanent monuments described on such map.
4. The scale of the map.
5. The county in which the claim is situated.
6. A north arrow.
7. The type of corner and location monuments used.
8. Bearing and distance between corners.
D. If the claim is a placer or millsite claim with exterior limits conforming to
legal subdivisions of the public survey, the map, plat or sketch shall give the legal
description of the claim instead of the requirements of paragraphs 3 and 8 of subsection
C.
E. Failure to do all the things within the times and at the places specified in
subsections A, B, C and D shall be an abandonment of the claim, and all right and claim
of the locator shall be forfeited.
F. The county recorder shall keep proper indices of mine location notices and maps
by the cadastral subdivisions of the United States bureau of land management or general
land office. The county recorder shall receive the fees prescribed in section 11-475 for
recording a mine location notice and map, plat or sketch appended to such notice.
27-204 Monumenting lode claims
The boundaries of a lode claim shall be monumented by six substantial posts
projecting at least four feet above the surface of the ground, or by substantial stone
monuments at least three feet high, one at each corner of the claim and one at the center
of each end line of a lode claim. Substantial posts may be of any material as may be
readily distinguished as monuments and shall be not less than one and one-half inches in
cross section. Each monument erected by the locator shall be marked to identify the
corner or end center of the claim or claims for which it was erected.
27-205 Locating and monumenting placer and millsite claims
The locator of a placer mining or millsite claim shall locate the claim in the same
manner as prescribed for a lode claim, except that:
1. The location notice shall be posted on a separate monument at one corner of the
claim within the boundaries of the claim.
2. Only the corners or angle points of the claim must be monumented.
27-206 Relocation
The relocation of a claim shall be made in the same manner as other locations. If
the original location work of the claim being relocated included the recording of a map
or plat pursuant to section 27-203, the locator may perform relocation work by
resurveying or by verifying the accuracy of the boundaries and positions of the claim as
shown on the map, plat or sketch of the claims and by recording a map, plat or sketch in
the manner prescribed by section 27-203.
27-208 Affidavit of performance of annual work; fees
A. Before December 31 of any year in which the performance of annual labor or
making improvements upon a mining claim is required, the person on whose behalf such work
or improvement was made, or some person for him, knowing the facts, may make and record
in the office of the county recorder of the county in which the claim is located an
affidavit in substance as follows:
State of ARIZONA, county of ____________________ ss:
_________________________________, being duly sworn, deposes and says that he is a
citizen of the United States and more than eighteen years of age, resides at
____________________, in ___________________ county, ARIZONA, is personally acquainted
with the mining claim known as ______________________ mining claim, situated in
__________________ mining district, ______________ county, ARIZONA, the location notice
of which is recorded in the office of the county recorder of said county, in book
________________________ of records of mines, at page _________. That between the
_______________ day of ________________, A.D. _______________________, and the
_______________ day of ______________________, A.D. ___________________________, at
least _____________________________ dollars worth of work and improvements were done and
performed upon said claim, not including the location work of said claim. Such work and
improvements were made by and at the expense of ___________________________, owners of
said claim, for the purpose of complying with the laws of the United States pertaining to
assessment or annual work, and _________________________________________ (here name the
miners or persons who worked upon the claim in doing the work) were the persons employed
by said owner and who labored upon said claim, did said work and improvements, the same
being as follows, to wit: (Here describe the work done and add signature and
verification.)
B. The affidavit when recorded shall be prima facie evidence of the performance of
the labor or improvements. Any affidavit shall include, if known to the locator, the
identification of the section, township and range in which the notice of location of the
claim is posted.
C. When annual work is done upon one or more of a contiguous group of claims for
the benefit of all, or wholly or partly outside of a contiguous group of claims for the
benefit of all, all claims may be included in a single affidavit.
D. In addition to the fees required under section 11-475 for recording of
documents, the county recorder shall, prior to recording the affidavit of performance,
collect from the person recording the affidavit a fee in the sum of five dollars for each
separate affidavit of performance recorded. The county recorder shall by the tenth day
of each month forward to the state treasurer for deposit in the state general fund,
eighty per cent of the monies collected pursuant to this subsection during the previous
month.
27-209 Sufficiency of description of mining claims
In all actions, judgments, grants, or conveyances it shall be a sufficient
description of a mining claim if the name of the claim, the district, county and state
where it is located, and the book and page where the location notice thereof is recorded
can be understood therefrom.
27-210 Existing claims
A. The owner of an unpatented lode, placer or millsite claim existing on the
effective date of this section may on or before October 21, 1980, file a map, plat or
sketch of such claim conforming to the requirements of section 27-203, subsections B and
C which shall also recite the book and page of recording of the location notice and any
amendments to the location notice. The owner of a group of claims may file a single plat
or map for any claims having the point of posting of the location notice within the same
section of the public land survey system.
B. The county recorder shall receive as fees fifty cents per claim for recording
such a map, plat or sketch under this section and shall index such claims by the name of
the claim in the index of claims by cadastral subdivisions of the United States bureau of
land management or general land office.
C. The recording of a claim in compliance with this section shall constitute
constructive notice to the public of the position of such claim after the date of
recording and shall constitute a rebuttable presumption that the claim was monumented on
the ground so that its boundaries could be readily traced.
27-221 Notice to delinquent co-owner to contribute share of annual labor expense
A. When a co-owner gives a delinquent co-owner notice in writing or notice by
publication to contribute his proportion of the expense of annual labor as provided by
the laws of the United States, an affidavit of the person giving the notice, stating the
time, place, manner of service and by whom and upon whom the service was made, shall be
attached to a true copy of the notice, and the notice and affidavit shall be recorded
ninety days after giving the notice, or if the notice is given by publication in a
newspaper, there shall be attached to a printed copy of the notice an affidavit of the
editor or publisher of the paper, stating the date of each insertion of the notice
therein, and when and where the newspaper was published during that time, and the
affidavit and notice shall be recorded one hundred and eighty days after the first
publication.
B. A true copy of the original notice and affidavit of service, or the records
thereof, shall be prima facie evidence that the delinquent co-owner has failed or refused
to contribute his proportion of the expenditure, and shall be prima facie evidence of
service or publication of the notice, unless the writing or affidavit provided for in
section 27-222 is of record.
27-222 Acknowledgment of contribution by delinquent co-owner
A. If the delinquent co-owner, within the time required by the laws of the United
States, contributes his proportion of the expenditures, the co-owner, who demanded
contribution shall sign and deliver to the delinquent co-owner a written statement that
the delinquent, naming him, has, within the time required, contributed his share of the
expense for the year upon the claim, and further stating the district, county and state
wherein the claim is located and the book and page where the location notice is
recorded. The statement shall be recorded.
B. If the co-owner who demanded contribution fails to sign and deliver the
statement to the delinquent co-owner within twenty days after contribution is made, he
shall be liable to the delinquent for a penalty of one hundred dollars. The delinquent,
with two disinterested persons having personal knowledge of the contribution, may make an
affidavit setting forth the manner, amount, to whom and upon what mine the contribution
was made. The affidavit may be recorded, and shall be prima facie evidence of the
contribution.
27-231 Definition of mineral
In this article, unless the context otherwise requires, "mineral" means all metallic
ore minerals and industrial minerals other than common variety minerals as defined in
section 27-271.
27-233 Preferred right to renew mineral lease; evaluation of geologic and economic evidence
A. Upon application to the state land commissioner, not less than thirty nor more
than sixty days prior to the expiration of the lease, if the lessee of mineral lands is
not delinquent in the payment of rental or royalty on the date of expiration of the
lease, the lessee shall have a preferred right to renew the lease bearing even date with
the expiration of the old lease for a term of twenty years. The commissioner may deny
the renewal application for any reason listed in section 27-251, subsection B, paragraphs
1 through 5.
B. In determining whether the proposed mining activities would be in the best
interest of the trust pursuant to section 27-251, subsection B, paragraph 2, the
commissioner may require the lessee to provide geologic and economic evidence showing at
least probable or indicated mineral resources, as that evidence is conventionally
interpreted in the mineral industry. Evidence provided to the state land department
under this subsection is a trade secret of the mineral industry and is confidential
pursuant to section 27-274.
27-234 Rent; royalty; appeal; interest; penalty; lien
A. Before issuing a mineral lease the state land commissioner shall establish the
annual land rental for the mineral lease. The rental shall be based on an appraisal of
the land that, for purposes of establishing the rent, shall not include the contributory
value of mining. The annual rental:
1. Shall be at least the average rental assessed per acre by the states of
Colorado, New Mexico and Utah. If a state assesses a range of rental rates rather than a
single rental rate, the median of the range of rental rates assessed by that state shall
be used in calculating the average under this paragraph.
2. Is payable in advance of executing the mineral lease agreement by the
commissioner and at the beginning of each annual period thereafter.
B. In addition to the annual rental, a production royalty of at least two per cent
is assessed against the gross value of all minerals produced and sold from the mineral
lease. Where processing is performed after the mineral is extracted, the mineral shall be
deemed produced and sold when the concentrate or cathode results from that processing.
The royalty rate for each mineral lease shall be based on an appraisal of this state's
interest as a lessor in the mineral and shall be established according to the appraisal
standard prescribed by subsection C of this section. The gross value shall be based on
the monthly average price of the mineral as quoted by the mineral commodities market and
industry trade journals as determined by the commissioner and specified in the lease. If
a mineral does not have a published price quotation, the gross value shall be based on an
appraisal that establishes the fair market price of the mineral. The royalty shall not be
based on any hedging or price protection arrangements that may be entered into by the
lessee and any of these arrangements shall not be considered in any appraisal that
established the fair market price of the mineral.
C. The commissioner shall appraise this state's interest as a lessor in the mineral
according to standard appraisal methodology and, to the extent feasible, shall base the
appraisal on market royalty rates. The appraisal shall be completed in order to determine
whether a royalty rate greater than two per cent of the gross value is required in order
to obtain a fair market value for this state's interests as a lessor in the mineral. The
appraisal shall be completed before issuing a mineral lease, at the end of the first year
of commercial production and again for each renewal of the lease. If, during the term of
the lease, new minerals are produced and sold from the mineral lease, or changes in
technology substantially affect the value of this state's interest as a lessor, the
commissioner at that time may reappraise that interest and, if appropriate, adjust the
royalty rate.
D. For mines existing on state lands on June 8, 1989, the royalty paid under this
section shall not be less than the royalty which would have been paid under statutes in
effect immediately before June 8, 1989.
E. The costs of all appraisals conducted under this section shall be assessed
against the lessee and added to the amount due as rental under this section.
F. The department shall review all property tax assessment information relevant to
the mineral lease. The department shall maintain that information on a confidential
basis as prescribed by title 42, chapter 2, article 1.
G. Every mineral lease of state land shall require the lessee to make the following
records available on an annual basis:
1. Itemized statements of mineral production.
2. Relevant tax records.
3. Additional relevant records pertinent to appraisal, compliance with the lease
and mineral production deemed necessary by the commissioner.
H. The information obtained under subsection G, paragraph 2 of this section and any
trade secrets are confidential. For purposes of this subsection, trade secrets are
information to which all of the following apply:
1. A person has taken reasonable measures to protect the information from
disclosure and the person intends to continue to take those measures.
2. The information is not and has not been reasonably obtainable by legitimate
means by other persons without the person's consent, other than by governmental entities
and other than in discovery based on a showing of special need in a judicial or
quasi-judicial proceeding.
3. A statute does not specifically require disclosure of the information to the
public.
4. The person has satisfactorily shown that disclosure of the information is likely
to cause substantial harm to the person's competitive position.
I. Mineral lessees shall make monthly royalty payments based on the mineral
production activity of the previous month.
J. Appeals of the appraisal decision of the commissioner may be taken pursuant to
section 37-215 to the board of appeals, established by section 37-213, which shall
affirm, modify or reverse the decision of the commissioner within one hundred eighty
days. Except as provided in section 41-1092.08, subsection H, decisions of the board of
appeals under this subsection are subject to judicial review pursuant to title 12,
chapter 7, article 6. As a condition of the appeal, the lessee must continue to make all
rental and royalty payments due based on the commissioner's final appraisal decision, and
the court shall not stay the commissioner's decision, in whole or in part, pending a
final disposition of the case. The state shall segregate rents and royalties paid while
an appeal is pending and shall not distribute such monies to the state general fund or to
the trust beneficiaries until the appeal is completed.
K. If a lessee fails to pay rent or royalty, including appraisal costs under
subsection C of this section, on or before the date the payment is due, the amount due
accrues interest at the rate and in the manner determined pursuant to section 42-1123.
In addition, if it is determined that the failure to pay is not due to reasonable cause,
a penalty of five per cent of the amount found to be remaining due shall be added to the
rent or royalty for each month or fraction of a month elapsing between the due date and
the date on which it is paid. The total penalty shall not exceed one-third of the rent or
royalty remaining due. The penalty so added to the rent or royalty is due and payable on
notice and demand from the commissioner.
L. If any rent, royalty, appraisal assessment, interest or penalty is not paid by
the lessee when due, the unpaid amounts constitute a lien from the date the amounts
become due on all property and rights to property that belong to the lessee and that are
located on state land.
27-235 Offering leases at auction; terms of lease; financial security termination
A. The state land commissioner may offer mineral leases at public auction, after
advertising, for state lands on which a mineral exploration permit or mineral lease has
been terminated or not been renewed by the lessee or permittee. The commissioner may
establish by rule the procedure for conducting the auction, but bidding is limited to a
cash bonus to be paid in full before the commissioner executes the lease documents. The
land rental and royalty rate are not subject to bidding.
B. Every mineral lease of state lands shall be for a term of twenty years.
C. The lease shall confer the right:
1. To extract and ship minerals from the leased land located within planes drawn
vertically downward through the exterior boundary lines of the leased land.
2. To use as much of the surface as required for purposes incident to mining.
3. Of ingress to and egress from other state lands, whether or not leased for
purposes other than mining.
D. Every mineral lease of state lands shall provide for:
1. The development and use of the property according to the lessee's general mining
plan approved by the commissioner.
2. The fencing of all shafts, exploration holes, adits, tunnels and other dangerous
mine workings for the protection of public health and safety and livestock.
3. The construction of necessary improvements and installation of necessary
machinery and equipment with the right to remove it upon expiration, termination or
abandonment of the lease, if the lessee is not in default of the terms and conditions of
the lease.
4. The right of the lessee and the lessee's assigns to transfer the lease.
5. Termination of the lease by the commissioner upon written notice specifically
setting forth the default for which forfeiture is declared, and preserving the right to
cure the default within a stated period of not less than thirty days.
E. If financial security is required under this subsection, it shall be in the form
of a cash deposit, a certificate of deposit, a surety bond or any other form of financial
assurance acceptable to the commissioner. On default, the commissioner may use the
proceeds of the financial security for the purposes described in paragraph 1, 2 or 3 of
this subsection. Financial security may be required in the following circumstances:
1. The commissioner may require financial security to guarantee the payment of all
monies due under the lease as royalty to this state.
2. The commissioner shall require financial security in a reasonable amount to be
fixed by the commissioner conditioned on the lessee's reclaiming the surface of the land
described in the lease to a reasonable condition in accordance with the reclamation
measures approved by the commissioner. The commissioner may enter into agreements
pursuant to title 11, chapter 7, article 3 with the state mine inspector's office, United
States bureau of land management, United States forest service and other agencies that
manage public lands and take other appropriate measures to coordinate the review and
approval of reclamation plans, including designating a lead agency for reclamation plan
review and action. The commissioner shall avoid redundant, inconsistent or contradictory
reclamation, inspection, administration, enforcement and financial assurance requirements
unless such requirements are necessary as a result of the commissioner's trust
obligations.
3. The commissioner shall require financial security conditioned on the lessee's
prompt payment to the owner or lessee of the surface of the state land described in the
lease, or across which the lessee exercises the right of ingress, for any loss to the
owner or lessee from damage or destruction caused by the lessee or the lessee's agents or
employees to grass, forage, crops or improvements on the land.
F. The lessee of any mineral lease who has met the applicable terms and conditions
of the lease from the time of issuance to the time of termination, as determined by the
commissioner, may terminate the lease at any time during its term by giving the
commissioner thirty days' written notice of the termination.
27-236 Suspension of royalty rights
The commissioner may, if he deems it in the interest of the state, subordinate the
royalty rights of the state under this article, or suspend the operation thereof or of
any lease executed under the provisions of this article, in favor of the United States or
any agency thereof, for the purpose of facilitating extension of financial aid under the
laws of the United States in the development or operation of any mine located upon state
lands.
27-237 Review by commissioner
All questions arising between a lessee and the commissioner under this article shall
be subject to review as in other cases involving state lands, and the lessee's right to
possess and operate the lease shall continue until the question is finally determined.
27-238 Existing leases
Every mineral lease issued under this article and article 4 of this chapter which
had not expired or been terminated by the department as of June 8, 1989 shall be in
effect for the unexpired term for which it was granted. The state land commissioner
shall set the rental and royalty according to the appraisal standards prescribed by
section 27-234 for any mineral lease in effect on June 8, 1989 and that rental and
royalty are effective as of December 10, 1987.
27-239 Inspections, investigations and audits
A. The state land commissioner or the commissioner's authorized representative may
enter, and the lessee shall maintain access to, the state land held under a mineral lease
at reasonable times to inspect the workings, improvements and other facilities used to
extract or sever minerals or common variety minerals, as defined in section 27-271, from
state lands.
B. The commissioner or the commissioner's authorized representative may enter at
reasonable times to:
1. Obtain factual data or access to records pertinent to mineral production and
required to be kept under the terms of the lease.
2. Otherwise ascertain compliance with law and the terms of the lease.
C. Inspections, investigations and audits under subsection A shall be on reasonable
notice to the lessee unless reasonable grounds exist to believe that notice would
frustrate the enforcement of law or the terms of the lease. The commissioner may, and if
required by law shall, apply for and obtain warrants for entry and inspection.
D. The commissioner may require a lessee to appear at reasonable times and on
reasonable notice at the commissioner's office and produce such records and information
as are specified in the notice to determine compliance with the terms of the lease.
E. The commissioner shall provide to the lessee a written report of each
inspection, investigation and audit under this section.
F. Tax records and trade secrets, as defined in section 23-401, obtained under this
section are confidential.
27-251 Application for mineral exploration permit
A. Any natural person over eighteen years of age and any other person qualified to
transact business in this state may apply to the state land commissioner for a mineral
exploration permit on the state land in one or more of the rectangular subdivisions of
twenty acres, more or less, or lots, in any one section of the public land survey. Such
application shall be in writing and signed by the applicant, or an authorized agent or
attorney for the applicant, and shall contain the name and address of the applicant, a
description according to the public land survey of the state land for which the applicant
seeks a mineral exploration permit, and such other information as the commissioner may
prescribe by rule. The application shall be filed with the state land department and
shall be accompanied by payment to the department of a filing fee as prescribed by
section 37-108. Each application meeting the requirements of this section shall be
stamped by the department with the time and date it is filed with the department. The
application shall have priority over any other application for a mineral exploration
permit involving the same state land which may be filed with the department subsequent to
such time and date, and such land shall be deemed withdrawn as long as the application is
pending.
B. Not less than thirty days nor more than forty-five days from the filing of the
application with the department, provided there is no prior application for a mineral
exploration permit involving the same state land then pending before the department, or
if such prior application is then pending but is subsequently cancelled, not more than
thirty days after it is cancelled, the department shall mail to the applicant at the
address shown on the application a written notice designating the state land that is
described in the application and that, at the time the application was filed with the
department, was open to application, the amount of rental required to be paid for the
mineral exploration permit as herein provided, and whether a bond will be required under
the provisions of section 27-255 as a condition to issuance of such permit. If, within
thirty days after the mailing of such notice, the applicant pays to the department as
rental for the permit the amount of two dollars per acre for each acre of state land
designated in the notice and files with the department the bond, if any, required under
section 27-255, and if the commissioner finds that issuing the permit is in the best
interest of the trust, the commissioner shall issue to the applicant a mineral
exploration permit for the state land designated in the notice. The commissioner may
deny the application for any of the following reasons:
1. The application was not made in good faith.
2. The proposed exploration or possible future mining activities would not be the
highest and best use of the trust lands.
3. The value and income potential of surrounding trust lands would be adversely
affected and the benefit from proposed exploration and future mining activity cannot
reasonably be expected to be greater than the diminished value to those surrounding trust
lands.
4. The proposed operations would violate applicable state or federal law.
5. The commissioner determines that the proposed exploration activities or possible
future mining activities will create a liability to the state greater than the income
from the proposed operations.
C. During the period such mineral exploration permit is in effect no person except
the permittee and the authorized agents and employees of the permittee shall be entitled
to explore for minerals on the state land covered by the permit. If the applicant fails
to make the payment or furnish the bond within the period of thirty days, the application
shall be deemed cancelled and of no further effect.
27-252 Terms of mineral exploration permit; definition
A. Every mineral exploration permit shall be for a term of one year from the date
of issuance, subject to renewals as provided in this article for an aggregate of not to
exceed five years from such date, and shall give to the permittee the rights, subject to
the terms and conditions, as follows:
1. During the period the permit is in force and effect, the permittee shall have
the exclusive right to explore for minerals within the state land covered by the permit
and to apply for and obtain a mineral lease or leases to the land.
2. The permittee shall have those surface rights necessary for exploration for
mineral on the state land covered by the permit, but may remove from the land only that
amount of mineral required by the permittee for sampling, assay and metallurgical testing
purposes.
3. The permittee shall have the right of ingress to and egress from the land
covered by the permit across other state lands but only along routes first approved by
the commissioner.
4. The permittee shall be liable to and shall compensate the owner and lessee of
the surface of the state land covered by the permit, or across which the permittee
exercises the right of ingress and egress, for any loss to such owner and lessee from
damage or destruction caused by the permittee or the permittee's agents or employees to
grasses, forage, crops or improvements upon such state land.
5. The permit shall terminate automatically as of the end of any annual period from
and after the date of issuance unless during such annual period the permittee expended in
exploration for valuable mineral deposits on the state land covered by the permit not
less than the amount per acre provided in this article or paid to the department a sum
equal thereto, and prior to expiration of such annual period shall have filed with the
department an application for renewal for the ensuing annual period, and an affidavit
showing such expenditure, together with such other proof in support thereof as the
commissioner by rule may prescribe. The amount to be so expended or paid to the
department during each of the first two annual periods in which such permit may be in
effect shall be not less than ten dollars for each acre of state land covered by the
permit at the commencement of such annual period, and the amount to be so expended or
paid to the department during each of the last three annual periods in which such permit
may be in effect shall be not less than twenty dollars for each acre of state land
covered by the permit at the commencement of such annual period. Prior to termination of
any such annual period, the permittee may, by instrument in writing filed with the
department, release from the permit the acreage covered thereby and contained within one
or more rectangular subdivisions of twenty acres, more or less, or lots, according to the
lines of the public land surveys.
6. When a permittee has an interest in one or more contiguous properties for which
he or she holds a mineral exploration permit, such permittee may group such permits and
expend the sum required by this article under a common plan of development on one or more
of the properties for the benefit of all if the total area of such contiguous property
does not exceed three miles on a side.
7. Upon termination of the mineral exploration permit, other than by issuance of a
mineral lease, the permittee shall submit to the department the following information,
which shall not include any chemical analysis or other identification of minerals,
concerning any drill holes or wells drilled on state land covered by the permit:
(a) Total depth.
(b) Lithologies and depths of lithologic boundaries encountered in the hole.
(c) Logs of surveys made of the hole including gamma ray, resistivity, caliper and
deviation surveys.
8. Drill hole information shall be confidential for one year after termination of
the permit, and such period of confidentiality shall be extended for an additional year
upon the request of the permittee.
9. Any expenditures in exploration for valuable mineral deposits made in excess of
the requirements of this article during any annual period of the permit may be credited
against expenditure requirements of successive annual periods of the permit.
10. In lieu of making expenditures in exploration, the permittee may elect to make a
money payment of the amounts required for expenditures in exploration for valuable
mineral deposits to the department.
B. Upon any partial or total relinquishment, or the cancellation or expiration of
the permit other than by issuance of a mineral lease, the permittee shall fill any holes,
ditches or other excavations, as may be required by the commissioner, and, as far as
reasonably possible, reclaim the surface to its former condition.
C. As used in this article, "exploration" means activity conducted upon the state
land covered by an exploration permit to determine the existence or nonexistence of a
valuable mineral deposit, including but not limited to geological, geochemical or
geophysical surveys conducted by qualified experts, and drilling, sampling and
excavation, together with the costs of assay and metallurgical testing of samples from
such land.
27-253 Renewal of permit
The holder of an exploration permit may, prior to expiration of the annual period
for which such permit was issued, or prior to expiration of the annual period for which
such permit was renewed, file with the department an application for renewal of such
permit for the ensuing annual period. No such application for renewal shall be filed,
nor shall the permit be renewed, for more than four successive annual periods following
expiration of the annual period for which such permit was issued. No rental shall be
payable for the first annual period for which a permit may be renewed. The rental for
each of the three subsequent annual periods following the first annual period for which a
permit may be renewed shall be one dollar for each acre of state land for which the
application for renewal is filed. Upon receipt by the department of the application for
renewal, and the affidavit of expenditure of the required amount in exploration during
the current annual period or a sum equal thereto, together with such other proof in
support of such expenditure as the commissioner by regulation may prescribe, and payment
to the department of the rental for the ensuing annual period, all prior to expiration of
the current annual period, the commissioner shall issue a renewal of the permit for the
ensuing annual period.
27-254 Mineral lease
Following discovery of a valuable mineral deposit upon the state land covered by a
mineral exploration permit within a rectangular subdivision of twenty acres, more or
less, or lot, of the public land survey, the permittee may apply to the commissioner for
a mineral lease upon the state land within such rectangular subdivision, or lot, and such
land shall, for the purpose of the application and any mineral lease issued pursuant to
such application, constitute a mineral claim without extralateral rights, and shall be
deemed to have been located as of the date of filing the application for the mineral
lease. Upon receipt of an application from the permittee for a mineral lease, and
satisfactory proof of discovery of a valuable mineral deposit, the commissioner shall
issue a mineral lease to the applicant for the mineral claim or claims covered by the
application. From and after the date of issuance of a mineral lease, the mineral claim
or claims covered by such mineral lease shall be deemed to be excluded from the
exploration permit. Upon application to the commissioner, not less than thirty nor more
than sixty days prior to the expiration of the lease, the lessee, if not delinquent in
the payment of rental or royalty on the date of expiration of the lease, shall have a
preferred right to renew the lease bearing even date with the expiration of the old lease
for a term of twenty years.
27-255 Bonds
A. The commissioner, in his discretion, may require the applicant for a mineral
exploration permit, prior to issuance of such permit, to file with the commissioner a
surety bond, in form and amount and with surety approved by the commissioner, conditioned
upon the prompt payment to the owner and lessee of the surface of state land to be
covered by the permit, or across which the permittee exercises the right of ingress or
egress, for any loss to such owner or lessee from damage or destruction caused by the
permittee or his or its agents or employees to grasses, forage, crops and improvements
upon such state lands.
B. The commissioner may also require the permittee to furnish a bond, in a
reasonable amount to be fixed by the commissioner, conditioned that the permittee will
guarantee restoration of the surface of the land described in the mineral exploration
permit to its former condition upon any partial or total relinquishment of such lands, or
the cancellation or expiration of the permit other than by issuance of a mineral lease.
C. On default, the commissioner may use the proceeds of the bond for the purposes
described in subsection A or B.
27-256 Assignment
Any mineral exploration permit issued hereunder may be assigned in whole or in part
by the permittee, but such assignment shall not become effective unless and until a copy
thereof is filed with the department and is approved by the commissioner. The assignee
shall succeed to all of the rights and shall be subject to obligations of the permittee
under the mineral exploration permit.
27-271.01 Inventory of trust land containing common mineral products, materials and property
The department shall maintain an inventory of lands suitable for lease or sale that
are within the boundaries identified in section 37-312 and are located in a county of
more than six hundred thousand persons according to the most recent United States
decennial census. Persons applying for reclassification of land pursuant to section
37-312 shall be notified if the land has been identified by the department as land
suitable for lease or sale.
27-271 Definition of common variety minerals
For purposes of this article, "common variety minerals":
1. Includes deposits of petrified wood, stone, pumice, pumicite or cinders,
decomposed granite, sand, gravel, boulders, common clay, fill dirt and waste rock.
2. Includes deposits that, although they may have value for use in trade,
manufacturing and the construction, landscaping and decorative rock industries, do not
possess a distinct, special economic value for those uses beyond the normal uses of those
deposits.
3. Includes material used as road base material, riprap, ballast, borrow, fill,
facing stone, landscaping or ornamental uses and other similar uses.
4. Does not include limestone suitable for use in producing cement, metallurgical
or chemical grade limestone or gypsum.
27-272 Common variety mineral leases; terms and conditions; rules
A. The state land department may dispose of common variety minerals at auction and
may execute common variety mineral leases offered at auction for the severance,
extraction or disposal of common variety minerals.
B. A lease shall be comprised of not more than one legal section of six hundred
forty acres, more or less, or lot of the public land survey and shall provide for:
1. A term of not more than ten years unless the commissioner considers a longer
term to be necessary, but in no event may the lease issue for a term longer than twenty
years.
2. A rental based on a percentage of the appraised land value, payable before the
commissioner executes the lease and at the beginning of each subsequent annual period.
3. The right of the lessee:
(a) To use as much of the surface of the premises as is reasonably necessary to
extract, sever, temporarily store, remove and dispose of common variety minerals.
(b) To wash, screen, crush, sort or otherwise mechanically process.
(c) Of ingress to and egress from the premises across other state lands along
designated routes approved by the department.
(d) To assign the lease, provided that such assignment shall not become effective
until a copy of the lease is filed with the department and is approved by the
commissioner as being in the best interests of the state.
4. Other terms and conditions as the department may deem for the best interests of
the state and that are not in conflict with the enabling act, constitution and laws of
this state.
C. The department shall establish in the lease the terms of the royalty to be paid
for all common variety minerals severed or extracted from the leased land and disposed of
by the lessee. The royalty rate shall be established by auction, but it shall be at
least the minimum royalty established by the department based on the appraised value of
the common variety minerals. The lease shall provide for:
1. Payment of a minimum annual royalty due and payable on the anniversary date of
the lease. The minimum annual royalty shall be based on a minimum annual production rate
and shall be applied as a credit to payment for common variety minerals extracted or
severed from the land. Royalty for any common variety mineral extracted, severed or
disposed of in excess of the minimum annual production is due and payable monthly, within
thirty days after billing.
2. The application of minimum annual royalty payments as a credit for payment of
common variety minerals for which payment must be made. Monies so advanced and not
credited against payments for common variety minerals become the sole property of this
state on termination or expiration of the agreement.
D. Common variety minerals are not subject to lease as provided by articles 3 and 4
of this chapter.
E. The department shall adopt rules necessary for the administration of this
article.
27-273 Performance and reclamation bonds
A. The commissioner may require the lessee to post a cash deposit, a certificate of
deposit, a surety bond or any other form of financial assurance acceptable to the
commissioner to guarantee the payment of all monies due under the lease as royalty to the
state.
B. The commissioner shall require the lessee to furnish a cash deposit, a
certificate of deposit, a surety bond or any other form of financial assurance acceptable
to the commissioner, in a reasonable amount to be fixed by the commissioner, conditioned
that the lessee will guarantee reclamation of the surface of the land described in the
lease to a reasonable condition in accordance with good mining practices.
C. The commissioner shall also require the lessee to file with the department a
cash deposit, a certificate of deposit, a surety bond or any other form of financial
assurance acceptable to the commissioner, conditioned upon prompt payment to the owner or
lessee of the surface of the state land covered by the lease, or across which the lessee
exercises the right of ingress, for any loss to such owner or lessee from damage or
destruction caused by the lessee or the lessee's agents or employees to grasses, forage,
crops and improvements upon such lands.
D. On default, the commissioner may use the proceeds of the cash deposit,
certificate of deposit, surety bond or other financial assurance for the purposes
described in subsection A, B or C.
27-274 Trade secrets; confidentiality; definition
A. For the proper administration of state land, the state land commissioner may
require a lessee to submit relevant geologic, engineering and feasibility studies and
other economic and technical information that is considered a trade secret in the mineral
industry.
B. To evaluate the mineral potential of state trust land, the commissioner may use
relevant geologic, engineering and feasibility studies and other economic and technical
information that is considered a trade secret in the mineral industry.
C. Trade secret information obtained under this section is confidential.
D. For purposes of this section, "trade secret" means information to which all of
the following apply:
1. A person has taken reasonable measures to protect the information from
disclosure and the person intends to continue to take those measures.
2. The information is not and has not been reasonably obtainable by legitimate
means by other persons without the person's consent, other than by governmental entities
and other than in discovery based on a showing of special need in a judicial or
quasi-judicial proceeding.
3. A statute does not specifically require disclosure of the information to the
public.
4. The person has satisfactorily shown that disclosing the information is likely to
cause substantial harm to the person's competitive position.
27-276 Enforcement
Leases issued and executed under this article are subject to the enforcement
provisions prescribed by section 27-239.
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