New Mexico 2025 Regular Session

New Mexico Senate Bill SB23 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	~~SFC/SB 23~~
2		-	~~Page 1~~
	1	+	underscored material = new
	2	+	[bracketed material] = delete
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	28	+	SENATE BILL 23
	29	+	57
	30	+	TH LEGISLATURE
	31	+	-
	32	+
	33	+	STATE
	34	+
	35	+	OF
	36	+
	37	+	NEW
	38	+
	39	+	MEXICO
	40	+
	41	+	-
	42	+	FIRST SESSION
	43	+	,
	44	+
	45	+	2025
	46	+	INTRODUCED BY
	47	+	George K. Muñoz
28	48		AN ACT
29	49		RELATING TO PUBLIC LANDS; SETTING THE ROYALTY RATE ON FUTURE
30		-	OIL AND GAS DEVELOPMENT LEASES ON CERTAIN STATE TRUST LANDS
31		-	TO ENHANCE REVENUE FOR BENEFICIARIES; REQUIRING THE MANNER OF
32		-	POSTING OF CERTAIN INFORMATION.
	50	+	OIL AND GAS DEVELOPMENT LEASES ON CERTAIN STATE TRUST LANDS TO
	51	+	ENHANCE REVENUE FOR BENEFICIARIES.
33	52		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
34		-	SECTION 1. Section 19-10-4.3 NMSA 1978 (being Laws
35		-	1985, Chapter 195, Section 5) is amended to read:
36		-	"19-10-4.3. DEVELOPMENT FORM OF LEASE--PREMIUM
37		-	RESTRICTED LAND.--
38		-	A. The commissioner shall not cancel leases except
39		-	upon failure or default of the lessee to comply with any of
40		-	the provisions or covenants within the lease described in
41		-	Subsection B of this section.
42		-	B. The following form is designed as the
43		-	"Development Form". It may be used by the commissioner for
44		-	oil and gas leases on lands classified as restricted lands
45		-	and categorized as Premium and issued on or after July 1,
46		-	2025:
47		-	"LEASE NO. ___________________ APPLICATION NO. ______________
	53	+	SECTION 1. Section 19-10-4.3 NMSA 1978 (being Laws 1985,
	54	+	Chapter 195, Section 5) is amended to read:
	55	+	"19-10-4.3. DEVELOPMENT FORM OF LEASE--PREMIUM RESTRICTED
	56	+	LAND.--The following form is designed as the "Development
	57	+	Form". It may be used by the commissioner for oil and gas
	58	+	leases on lands classified as restricted lands and categorized
	59	+	as Premium and issued on or after July 1, 2025 :
	60	+	"LEASE NO. _____________________ APPLICATION NO. ______________
48	61		OIL AND GAS LEASE
49	62		(Development Form)
50		-	This agreement, dated ____________________, 20___,
51		-	between the state of New Mexico, acting by and through its SFC/SB 23
52		-	Page 2
	63	+	.229493.3SA underscored material = new
	64	+	[bracketed material] = delete
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78		-	commissioner of public lands, hereinafter called the
79		-	"lessor", and_______________________________________________,
80		-	whose address is ___________________________________________
81		-	____________________________________________________________,
	90	+	This agreement, dated ____________________, [19 ] 20___,
	91	+	between the state of New Mexico, acting by and through its
	92	+	commissioner of public lands, hereinafter called the "lessor",
	93	+	and _________________________________________________________,
	94	+	whose address is ____________________________________________
	95	+	_____________________________________________________________,
82	96		hereinafter called the "lessee",
83	97		WITNESSETH:
84	98		WHEREAS, the lessee has filed in the office of the
85		-	commissioner of public lands an application for an oil and
86		-	~~gas~~ lease covering the lands hereinafter described and has
87		-	~~tendered~~ therewith the required first payment; and
	99	+	commissioner of public lands an application for an oil and gas
	100	+	lease covering the lands hereinafter described and has tendered
	101	+	therewith the required first payment; and
88	102		WHEREAS, all of the requirements of law relative to the
89	103		application and tender have been duly complied with;
90		-	THEREFORE, in consideration of the premises as well as
91		-	~~the~~ sum of___________________________________________________
	104	+	THEREFORE, in consideration of the premises as well as the
	105	+	sum of _______________________________________________________
92	106		dollars ($________________), the same being the amount of the
93	107		tender above mentioned, and the further sum of $___________
94	108		filing fee, and of the covenants and agreements hereinafter
95		-	contained, the lessor does hereby grant, demise, lease and
96		-	~~let~~ unto the lessee, exclusively, for the sole and only
	109	+	contained, the lessor does hereby grant, demise, lease and let
	110	+	unto the [said] lessee, exclusively, for the sole and only
97	111		purpose of exploration, development and production of oil or
98		-	gas (including carbon dioxide and helium), or both thereon
99		-	~~and~~ therefrom with the right to own all oil and gas so
100		-	~~produced and~~ saved therefrom and not reserved as royalty by
101		-	~~the lessor under the terms of this lease, together with~~
102		-	~~rights of way,~~ ~~easements and servitudes for pipelines, SFC/SB 23~~
103		-	~~Page 3~~
	112	+	gas (including carbon dioxide and helium), or both thereon and
	113	+	therefrom with the right to own all oil and gas so produced and
	114	+	saved therefrom and not reserved as royalty by the lessor under
	115	+	.229493.3SA
	116	+	- 2 - underscored material = new
	117	+	[bracketed material] = delete
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129		-	telephone lines, tanks, power houses, stations, gasoline
130		-	plants and fixtures for producing, treating and caring for
131		-	such products and housing and boarding employees and any and
132		-	all rights and privileges necessary, incident to or
133		-	convenient for the economical operation of the land, for oil
134		-	and gas, with right for such purposes to the free use of oil,
135		-	gas, casing-head gas or water from the lands, but not from
136		-	the lessor's water wells, and with the rights of removing
137		-	either during or after the term hereof, all and any
138		-	improvements placed or erected on the premises by the lessee,
139		-	including the right to pull all casing, subject, however, to
140		-	the covenants and conditions hereinafter set out, the
141		-	following described land situated in the county of _________,
142		-	state of New Mexico, and more particularly described as
143		-	follows:
	143	+	the terms of this lease, together with [rights-of-way ] rights
	144	+	of way, easements and servitudes for pipelines, telephone
	145	+	lines, tanks, power houses, stations, gasoline plants and
	146	+	fixtures for producing, treating and caring for such products
	147	+	and housing and boarding employees and any and all rights and
	148	+	privileges necessary, incident to or convenient for the
	149	+	economical operation of [said ] the land, for oil and gas, with
	150	+	right for such purposes to the free use of oil, gas, casing-
	151	+	head gas or water from [said ] the lands, but not from the
	152	+	lessor's water wells, and with the rights of removing either
	153	+	during or after the term hereof, all and any improvements
	154	+	placed or erected on the premises by the lessee, including the
	155	+	right to pull all casing, subject, however, to the covenants
	156	+	and conditions hereinafter set out, the following described
	157	+	land situated in the county of ___________, state of New
	158	+	Mexico, and more particularly described as follows:
144	159		Line SUBDIVISION Sec. Twp. Rge. Acres Institution
145		-	1 ___________________________________________________________
146		-	2 ___________________________________________________________
147		-	3 ___________________________________________________________
148		-	4 ___________________________________________________________
149		-	5 ___________________________________________________________
150		-	6 ___________________________________________________________
151		-	7 ___________________________________________________________
152		-	The lands having been awarded to the lessee and
153		-	designated as Tract No. ____________ at a public sale held by SFC/SB 23
154		-	Page 4
	160	+	1 _____________________________________________________________
	161	+	2 _____________________________________________________________
	162	+	3 _____________________________________________________________
	163	+	4 _____________________________________________________________
	164	+	5 _____________________________________________________________
	165	+	6 _____________________________________________________________
	166	+	7 _____________________________________________________________
	167	+	[Said] The lands having been awarded to the lessee and
	168	+	.229493.3SA
	169	+	- 3 - underscored material = new
	170	+	[bracketed material] = delete
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180		-	the commissioner of public lands on ____________________,
	196	+	designated as Tract No. ____________ at a public sale held by
	197	+	the commissioner of public lands on ____________________, [19 ]
181	198		20___.
182		-	To have and to hold the land, and all the rights ~~and~~
183		-	privileges granted hereunder, to and unto the lessee for a
	199	+	To have and to hold [said ] the land, and all the rights
	200	+	and privileges granted hereunder, to and unto the lessee for a
184	201		primary term of five years from the date hereof, and as long
185	202		thereafter as oil and gas, or either of them, is produced in
186		-	paying quantities from the land by the lessee, subject ~~to all~~
187		-	of the terms and conditions as hereinafter set forth.
188		-	In consideration of the premises, the parties covenant
189		-	~~and~~ agree as follows:
	203	+	paying quantities from [said ] the land by the lessee, subject
	204	+	to all of the terms and conditions as hereinafter set forth.
	205	+	In consideration of the premises, the parties covenant and
	206	+	agree as follows:
190	207		1. Subject to the free use without royalty, as
191	208		hereinbefore provided, the lessee shall pay the lessor as
192		-	royalty ________ (not less than three-sixteenths nor more
193		-	than one-fifth, or alternatively, not less than one-fifth nor
194		-	more than one-fourth if the leased premises is located in
195		-	whole or in part within the following portions of the
196		-	restricted districts established pursuant to Section 19-10-16
197		-	NMSA 1978: townships 8 to 10 south inclusive, ranges 31 to 38
198		-	east inclusive; townships 11 to 15 south inclusive, ranges
199		-	31 to 38 east inclusive; townships 16 to 20 south inclusive,
200		-	ranges 21 to 39 east inclusive; township 20.5 south, ranges
201		-	21 to 23 east inclusive; or townships 21 to 26 south
202		-	inclusive, ranges 21 to 38 east inclusive, N.M.P.M.) part of
203		-	the oil produced and saved from the leased premises or the
204		-	cash value thereof, at the option of the lessor, such value SFC/SB 23
205		-	Page 5
	209	+	royalty ________ (not less than three-sixteenths nor more than
	210	+	one-fifth, or alternatively, not less than one-fifth nor more
	211	+	than one-fourth if the leased premises is located in whole or
	212	+	in part within the following portions of the restricted
	213	+	districts established pursuant to Section 19-10-16 NMSA 1978:
	214	+	townships 8 to 10 south inclusive, ranges 31 to 38 east
	215	+	inclusive; townships 11 to 15 south inclusive, ranges 31 to 38
	216	+	east inclusive; townships 16 to 20 south inclusive, ranges 21
	217	+	to 39 east inclusive; township 20.5 south, ranges 21 to 23 east
	218	+	inclusive; or townships 21 to 26 south inclusive, ranges 21 to
	219	+	38 east inclusive, N.M.P.M. ) part of the oil produced and saved
	220	+	from the leased premises or the cash value thereof, at the
	221	+	.229493.3SA
	222	+	- 4 - underscored material = new
	223	+	[bracketed material] = delete
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231		-	to be the price prevailing the ~~day oil is run into a~~
232		-	pipeline, if the oil be run into a ~~pipeline, or into storage~~
233		-	tanks, if the oil is stored.
	249	+	option of the lessor, such value to be the price prevailing the
	250	+	day oil is run into a pipeline, if the oil be run into a
	251	+	pipeline, or into storage tanks, if the oil is stored.
234	252		2. Subject to the free use without royalty, as
235		-	hereinbefore provided, at the option of the lessor at any
236		-	time and from time to time, the lessee shall pay the lessor
237		-	as royalty ________ (not less than three-sixteenths nor more
238		-	than one-fifth, or alternatively, not less than one-fifth nor
239		-	more than one-fourth if the leased premises is located in
240		-	whole or in part within the following portions of the
241		-	restricted districts established pursuant to Section 19-10-16
242		-	NMSA 1978: townships 8 to 10 south inclusive, ranges 31 to 38
243		-	east inclusive; townships 11 to 15 south inclusive, ranges
244		-	31 to 38 east inclusive; townships 16 to 20 south inclusive,
245		-	ranges 21 to 39 east inclusive; township 20.5 south, ranges
246		-	21 to 23 east inclusive; or townships 21 to 26 south
247		-	inclusive, ranges 21 to 38 east inclusive, N.M.P.M.) part of
248		-	the gas produced and saved from the leased premises,
249		-	including casing-head gas. Unless the option is exercised by
250		-	the lessor, the lessee shall pay the lessor as royalty
251		-	________ (not less than three-sixteenths nor more than
	253	+	hereinbefore provided, at the option of the lessor at any time
	254	+	and from time to time, the lessee shall pay the lessor as
	255	+	royalty ________ (not less than three-sixteenths nor more than
252	256		one-fifth, or alternatively, not less than one-fifth nor more
253	257		than one-fourth if the leased premises is located in whole or
254	258		in part within the following portions of the restricted
255		-	districts established pursuant to Section 19-10-16 NMSA 1978: SFC/SB 23
256		-	Page 6
	259	+	districts established pursuant to Section 19-10-16 NMSA 1978:
	260	+	townships 8 to 10 south inclusive, ranges 31 to 38 east
	261	+	inclusive; townships 11 to 15 south inclusive, ranges 31 to 38
	262	+	east inclusive; townships 16 to 20 south inclusive, ranges 21
	263	+	to 39 east inclusive; township 20.5 south, ranges 21 to 23 east
	264	+	inclusive; or townships 21 to 26 south inclusive, ranges 21 to
	265	+	38 east inclusive, N.M.P.M. ) part of the gas produced and saved
	266	+	from the leased premises, including casing-head gas. Unless
	267	+	[said] the option is exercised by the lessor, the lessee shall
	268	+	pay the lessor as royalty ________ (not less than three-
	269	+	sixteenths nor more than one-fifth, or alternatively, not less
	270	+	than one-fifth nor more than one-fourth if the leased premises
	271	+	is located in whole or in part within the following portions of
	272	+	the restricted districts established pursuant to Section
	273	+	19-10-16 NMSA 1978: townships 8 to 10 south inclusive, ranges
	274	+	.229493.3SA
	275	+	- 5 - underscored material = new
	276	+	[bracketed material] = delete
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282		-	townships 8 to 10 south inclusive, ranges 31 to 38 east
283		-	inclusive; townships 11 to 15 south inclusive, ranges
284		-	31 to 38 east inclusive; townships 16 to 20 south inclusive,
285		-	ranges 21 to 39 east inclusive; township 20.5 south, ranges
286		-	21 to 23 east inclusive; or townships 21 to 26 south
	302	+	31 to 38 east inclusive; townships 11 to 15 south inclusive,
	303	+	ranges 31 to 38 east inclusive; townships 16 to 20 south
	304	+	inclusive, ranges 21 to 39 east inclusive; township 20.5 south,
	305	+	ranges 21 to 23 east inclusive; or townships 21 to 26 south
287	306		inclusive, ranges 21 to 38 east inclusive, N.M.P.M. ) of the
288		-	cash value of the gas, including casing-head gas, produced
289		-	~~and~~ saved from the leased premises and marketed or utilized,
290		-	~~such~~ value to be equal to the net proceeds derived from the
291		-	~~sale of~~ such gas in the field; provided, however, the cash
292		-	~~value for~~ royalty purposes of carbon dioxide gas and of
293		-	~~hydrocarbon gas~~ delivered to a gasoline plant for extraction
294		-	~~of liquid~~ hydrocarbons shall be equal to the net proceeds
295		-	~~derived from~~ the sale of such gas, including any liquid
296		-	~~hydrocarbons~~ recovered therefrom.
	307	+	cash value of the gas, including casing-head gas, produced and
	308	+	saved from the leased premises and marketed or utilized, such
	309	+	value to be equal to the net proceeds derived from the sale of
	310	+	such gas in the field; provided, however, the cash value for
	311	+	royalty purposes of carbon dioxide gas and of hydrocarbon gas
	312	+	delivered to a gasoline plant for extraction of liquid
	313	+	hydrocarbons shall be equal to the net proceeds derived from
	314	+	the sale of such gas, including any liquid hydrocarbons
	315	+	recovered therefrom.
297	316		Notwithstanding the foregoing provisions, the lessor may
298	317		require the payment of royalty for all or any part of the gas
299		-	produced and saved under this lease and marketed or used at a
300		-	price per m.c.f. equal to the maximum price being paid for
301		-	gas of like kind and quality and under like conditions in the
302		-	same field or area or may reduce the royalty value of any
303		-	such gas (to any amount not less than the net proceeds of
304		-	sale thereof, in the field) if the commissioner of public
305		-	lands shall determine such action to be necessary to the
306		-	successful operation of the lands for oil or gas purposes or SFC/SB 23
307		-	Page 7
	318	+	produced and saved under this lease and marketed or [utilized ]
	319	+	used at a price per m.c.f. equal to the maximum price being
	320	+	paid for gas of like kind and quality and under like conditions
	321	+	in the same field or area or may reduce the royalty value of
	322	+	any such gas (to any amount not less than the net proceeds of
	323	+	sale thereof, in the field) if the commissioner of public lands
	324	+	shall determine such action to be necessary to the successful
	325	+	operation of the lands for oil or gas purposes or to
	326	+	encouragement [or] of the greatest ultimate recovery of oil or
	327	+	.229493.3SA
	328	+	- 6 - underscored material = new
	329	+	[bracketed material] = delete
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333		-	to encouragement of the greatest ultimate recovery of oil or
334		-	gas or to the promotion or conservation of oil or gas or in
335		-	the public interest.
336		-	3. This lease shall not expire at the end of the
337		-	primary term hereof if there is a well capable of producing
338		-	gas in paying quantities located upon some part of the lands
339		-	embraced herein, or upon lands pooled or communitized
340		-	herewith, where such well is shut-in due to the inability of
341		-	the lessee to obtain a pipeline connection or to market the
342		-	gas therefrom, and if the lessee timely pays an annual
343		-	royalty on or before the annual rental paying date next
344		-	ensuing after the expiration of ninety days from the date the
345		-	well was shut-in and on or before the rental date thereafter.
346		-	The payment of the annual royalty shall be considered for all
347		-	purposes the same as if gas were being produced in paying
348		-	quantities and upon the commencement of marketing of gas from
349		-	the well or wells the royalty paid for the lease year in
350		-	which the gas is first marketed shall be credited upon the
351		-	royalty payable hereunder to the lessor for such year. The
352		-	provisions of this section shall also apply where gas is
353		-	being marketed from the leasehold premises and through no
354		-	fault of the lessee, the pipeline connection or market is
355		-	lost or ceases, in which case this lease shall not expire so
356		-	long as the annual royalty is paid as herein provided. The
357		-	amount of any annual royalty payable under this section shall SFC/SB 23
358		-	Page 8
	355	+	gas or to the promotion or conservation of oil or gas or in the
	356	+	public interest.
	357	+	3. This lease shall not expire at the end of the primary
	358	+	term hereof if there is a well capable of producing gas in
	359	+	paying quantities located upon some part of the lands embraced
	360	+	herein, or upon lands pooled or communitized herewith, where
	361	+	such well is shut-in due to the inability of the lessee to
	362	+	obtain a pipeline connection or to market the gas therefrom,
	363	+	and if the lessee timely pays an annual royalty on or before
	364	+	the annual rental paying date next ensuing after the expiration
	365	+	of ninety days from the date [said ] the well was shut-in and on
	366	+	or before [said] the rental date thereafter. The payment of
	367	+	[said] the annual royalty shall be considered for all purposes
	368	+	the same as if gas were being produced in paying quantities and
	369	+	upon the commencement of marketing of gas from [said ] the well
	370	+	or wells the royalty paid for the lease year in which the gas
	371	+	is first marketed shall be credited upon the royalty payable
	372	+	hereunder to the lessor for such year. The provisions of this
	373	+	section shall also apply where gas is being marketed from
	374	+	[said] the leasehold premises and through no fault of the
	375	+	lessee, the pipeline connection or market is lost or ceases, in
	376	+	which case this lease shall not expire so long as [said ] the
	377	+	annual royalty is paid as herein provided. The amount of any
	378	+	annual royalty payable under this section shall equal twice the
	379	+	annual rental due by the lessee under the terms of this lease
	380	+	.229493.3SA
	381	+	- 7 - underscored material = new
	382	+	[bracketed material] = delete
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372	396		14
373	397		15
374	398		16
375	399		17
376	400		18
377	401		19
378	402		20
379	403		21
380	404		22
381	405		23
382	406		24
383	407		25
384		-	equal twice the annual rental due by the lessee under the
385		-	terms of this lease but not less than three hundred twenty
386		-	dollars ($320) per well per year; provided, however, that any
387		-	such annual royalty for any month beginning on or after ten
388		-	years from the date hereof shall equal four times the annual
389		-	rental due by the lessee under the terms of this lease but
390		-	not less than two thousand dollars ($2,000) per well per
391		-	year; provided further, that no annual royalty shall be
392		-	payable under this section if equivalent amounts are timely
393		-	paid pursuant to another lease issued by the lessor and if
394		-	such other lease includes lands communitized with lands
395		-	granted hereunder for the purpose of prorationally sharing in
396		-	the shut-in well. Notwithstanding the provisions of this
397		-	section to the contrary, this lease shall not be continued
398		-	after five years from the date hereof for any period of more
399		-	than ten years by the payment of the annual royalty unless,
400		-	for good cause shown, the commissioner of public lands, in
401		-	the commissioner's discretion, grants such a continuance.
402		-	4. The lessee agrees to make full settlement on the
	408	+	but not less than three hundred twenty dollars ($320) per well
	409	+	per year; provided, however, that any such annual royalty for
	410	+	any month beginning on or after ten years from the date hereof
	411	+	shall equal four times the annual rental due by the lessee
	412	+	under the terms of this lease but not less than two thousand
	413	+	dollars ($2,000) per well per year; provided further, that no
	414	+	annual royalty shall be payable under this section if
	415	+	equivalent amounts are timely paid pursuant to another lease
	416	+	issued by the lessor and if such other lease includes lands
	417	+	communitized with lands granted hereunder for the purpose of
	418	+	prorationally sharing in the shut-in well. Notwithstanding the
	419	+	provisions of this section to the contrary, this lease shall
	420	+	not be continued after five years from the date hereof for any
	421	+	period of more than ten years by the payment of [said ] the
	422	+	annual royalty unless, for good cause shown, the commissioner
	423	+	of public lands, in [his ] the commissioner's discretion, grants
	424	+	such a continuance.
	425	+	[3.] 4. The lessee agrees to make full settlement on the
403	426		twentieth day of each month for all royalties due the lessor
404	427		for the preceding month, under this lease, and to permit the
405	428		lessor or its agents, at all reasonable hours, to examine the
406	429		lessee's books relating to the production and disposition of
407	430		oil and gas produced. The lessee further agrees to submit to
408		-	the lessor annually upon forms furnished by the lessor, SFC/SB 23
409		-	Page 9
	431	+	the lessor annually upon forms furnished by the lessor,
	432	+	verified reports showing the lessee's operations for the
	433	+	.229493.3SA
	434	+	- 8 - underscored material = new
	435	+	[bracketed material] = delete
410	436		1
411	437		2
412	438		3
413	439		4
414	440		5
415	441		6
416	442		7
417	443		8
418	444		9
419	445		10
420	446		11
421	447		12
422	448		13
423	449		14
424	450		15
425	451		16
426	452		17
427	453		18
428	454		19
429	455		20
430	456		21
431	457		22
432	458		23
433	459		24
434	460		25
435		-	verified reports showing the lessee's operations for the
436	461		preceding year.
437		-	5. An annual rental at the rate of $_____________ ~~per~~
438		-	acre shall become due and payable to the lessor by the
	462	+	[4.] 5. An annual rental at the rate of $_____________
	463	+	per acre shall become due and payable to the lessor by the
439	464		lessee, upon each acre of the land above described and then
440		-	claimed by such lessee and the same shall be due and payable
441		-	in advance to the lessor on the successive anniversary dates
442		-	of this lease, but the annual rental on any assignment shall
443		-	~~in no~~ event be less than forty dollars ($40.00).
	465	+	claimed by such lessee and the same shall be due and payable in
	466	+	advance to the lessor on the successive anniversary dates of
	467	+	this lease, but the annual rental on any assignment shall in no
	468	+	event be less than forty dollars ($40.00).
444	469		In the event the lessee shall elect to surrender any or
445		-	all of the acreage, the lessee shall deliver to the ~~lessor a~~
446		-	duly executed release thereof and in event the ~~lease has been~~
447		-	recorded then the lessee shall upon request ~~furnish and~~
448		-	deliver to the lessor a certified copy of a duly ~~recorded~~
449		-	release.
450		-	6. The lessee may at any time by paying to the ~~lessor~~
451		-	all amounts then due as provided herein and the further ~~sum~~
452		-	of forty dollars ($40.00), surrender and cancel this lease
	470	+	all of [said] the acreage, [he] the lessee shall deliver to the
	471	+	lessor a duly executed release thereof and in event [said ] the
	472	+	lease has been recorded then [he ] the lessee shall upon request
	473	+	furnish and deliver to the lessor a certified copy of a duly
	474	+	recorded release.
	475	+	[5.] 6. The lessee may at any time by paying to the
	476	+	lessor all amounts then due as provided herein and the further
	477	+	sum of forty dollars ($40.00), surrender and cancel this lease
453	478		insofar as the same covers all or any portion of the lands
454	479		herein leased and be relieved from further obligations or
455	480		liability hereunder, in the manner as hereinbefore provided.
456		-	Provided, this surrender clause and the option herein
457		-	reserved to the lessee shall cease and become absolutely
458		-	inoperative immediately and concurrently with the institution
459		-	of any suit in any court of law or equity by the lessee, SFC/SB 23
460		-	Page 10
	481	+	Provided, this surrender clause and the option herein reserved
	482	+	to the lessee shall cease and become absolutely inoperative
	483	+	immediately and concurrently with the institution of any suit
	484	+	in any court of law or equity by the lessee, lessor or any
	485	+	assignee, to enforce this lease, or any of its terms expressed
	486	+	.229493.3SA
	487	+	- 9 - underscored material = new
	488	+	[bracketed material] = delete
461	489		1
462	490		2
463	491		3
464	492		4
465	493		5
466	494		6
467	495		7
468	496		8
469	497		9
470	498		10
471	499		11
472	500		12
473	501		13
474	502		14
475	503		15
476	504		16
477	505		17
478	506		18
479	507		19
480	508		20
481	509		21
482	510		22
483	511		23
484	512		24
485	513		25
486		-	lessor or any assignee, to enforce this lease, or any of its
487		-	terms expressed or implied.
488		-	7. All payments due hereunder shall be made on or
	514	+	or implied.
	515	+	[6.] 7. All payments due hereunder shall be made on or
489	516		before the day such payment is due, at the office of the
490	517		commissioner of public lands in Santa Fe, New Mexico.
491		-	8. The lessee with the consent of the lessor shall have
492		-	the rights to assign this lease in whole or in part.
493		-	Provided, however, that no assignment of an undivided
494		-	interest in the lease or in any part thereof nor any
495		-	assignment of less than a legal subdivision shall be
496		-	recognized or approved by the lessor. Upon approval in
497		-	writing by the lessor of an assignment, the assignor shall
498		-	stand relieved from all obligations to the lessor with
499		-	respect to the lands embraced in the assignment and the
500		-	lessor shall likewise be relieved from all obligations to the
501		-	assignor as to such tracts, and the assignee shall succeed to
502		-	all of the rights and privileges of the assignor with respect
503		-	to such tracts and shall be held to have assumed all of the
504		-	duties and obligations of the assignor to the lessor as to
505		-	such tracts.
506		-	9. In the event a well or wells producing oil or gas in
507		-	paying quantities should be brought in on adjacent land that
508		-	is draining the leased premises, the lessee shall drill such
509		-	offset well or wells as a reasonably prudent operator would
510		-	drill under the same or similar circumstances, provided that SFC/SB 23
511		-	Page 11
	518	+	[7.] 8. The lessee with the consent of the lessor shall
	519	+	have the rights to assign this lease in whole or in part.
	520	+	Provided, however, that no assignment of an undivided interest
	521	+	in the lease or in any part thereof nor any assignment of less
	522	+	than a legal subdivision shall be recognized or approved by the
	523	+	lessor. Upon approval in writing by the lessor of an
	524	+	assignment, the assignor shall stand relieved from all
	525	+	obligations to the lessor with respect to the lands embraced in
	526	+	the assignment and the lessor shall likewise be relieved from
	527	+	all obligations to the assignor as to such tracts, and the
	528	+	assignee shall succeed to all of the rights and privileges of
	529	+	the assignor with respect to such tracts and shall be held to
	530	+	have assumed all of the duties and obligations of the assignor
	531	+	to the lessor as to such tracts.
	532	+	[8.] 9. In the event a well or wells producing oil or gas
	533	+	in paying quantities should be brought in on adjacent land
	534	+	[which] that is draining the leased premises, the lessee shall
	535	+	drill such offset well or wells as a reasonably prudent
	536	+	operator would drill under the same or similar circumstances,
	537	+	provided that no such offset well shall be required if
	538	+	compensatory royalties are paid pursuant to an agreement
	539	+	.229493.3SA
	540	+	- 10 - underscored material = new
	541	+	[bracketed material] = delete
512	542		1
513	543		2
514	544		3
515	545		4
516	546		5
517	547		6
518	548		7
519	549		8
520	550		9
521	551		10
522	552		11
523	553		12
524	554		13
525	555		14
526	556		15
527	557		16
528	558		17
529	559		18
530	560		19
531	561		20
532	562		21
533	563		22
534	564		23
535	565		24
536	566		25
537		-	no such offset well shall be required if compensatory
538		-	royalties are paid pursuant to an agreement between the
539		-	lessor and the lessee.
540		-	10. The lessee agrees to notify the lessor of the
	567	+	between the lessor and the lessee.
	568	+	[9.] 10. The lessee agrees to notify the lessor of the
541	569		location of each well before commencing drilling thereon, to
542	570		keep a complete and accurate log of each well drilled and to
543	571		furnish a copy thereof, verified by some person having actual
544	572		knowledge of the facts, to the lessor upon the completion of
545		-	any well, and to furnish the log of any unfinished well at
546		-	~~any~~ time when requested to do so by the lessor.
	573	+	any well, and to furnish the log of any unfinished well at any
	574	+	time when requested to do so by the lessor.
547	575		If any lands embraced in this lease shall be included in
548	576		any deed or contract of purchase outstanding and subsisting
549	577		issued pursuant to any sale made of the surface of such lands
550	578		prior to the date of this lease, it is agreed and understood
551		-	that no drilling operation shall be commenced on any such
552		-	lands so sold unless and until the lessee shall have filed a
553		-	good and sufficient bond with the lessor as required by law,
554		-	to secure the payment for such damage to the livestock,
555		-	range, water, crops or tangible improvements on such lands as
556		-	may be suffered by the purchaser holding such deed or
557		-	contract of purchase, or the purchaser's successors, by
558		-	reason of the developments, use and occupation of such lands
559		-	by such lessee. Provided, however, that no such bond shall
560		-	be required if such purchaser shall waive the right to
561		-	require such bond to be given in the manner provided by law. SFC/SB 23
562		-	Page 12
	579	+	that no drilling operation shall be commenced on any such lands
	580	+	so sold unless and until the lessee shall have filed a good and
	581	+	sufficient bond with the lessor as required by law, to secure
	582	+	the payment for such damage to the livestock, range, water,
	583	+	crops or tangible improvements on such lands as may be suffered
	584	+	by the purchaser holding such deed or contract of purchase, or
	585	+	[his] the purchaser's successors, by reason of the
	586	+	developments, use and occupation of such lands by such lessee.
	587	+	Provided, however, that no such bond shall be required if such
	588	+	purchaser shall waive the right to require such bond to be
	589	+	given in the manner provided by law.
	590	+	[10.] 11. In drilling wells, all water-bearing strata
	591	+	shall be noted in the log, and the lessor reserves the right to
	592	+	.229493.3SA
	593	+	- 11 - underscored material = new
	594	+	[bracketed material] = delete
563	595		1
564	596		2
565	597		3
566	598		4
567	599		5
568	600		6
569	601		7
570	602		8
571	603		9
572	604		10
573	605		11
574	606		12
575	607		13
576	608		14
577	609		15
578	610		16
579	611		17
580	612		18
581	613		19
582	614		20
583	615		21
584	616		22
585	617		23
586	618		24
587	619		25
588		-	11. In drilling wells, all water-bearing strata shall
589		-	be noted in the log, and the lessor reserves the right to
590		-	require that all or any part of the casing shall be left in
591		-	any nonproductive well when the lessor deems it to the
592		-	interest of the beneficiaries of the lands granted hereunder
593		-	to maintain the well or wells for water. For such casing so
594		-	left in wells the lessor shall pay to the lessee the
595		-	reasonable value thereof.
596		-	12. The lessee shall be liable and agree to pay for all
597		-	damages to the range, livestock, growing crops or
598		-	improvements caused by the lessee's operations on the lands.
599		-	When requested by the lessor, the lessee shall bury pipelines
600		-	below plow depth.
601		-	13. The lessee shall not remove any machinery or
602		-	fixtures placed on the premises, nor draw the casing from any
603		-	well unless and until all payments and obligations due the
604		-	lessor under the terms of this agreement shall have been paid
605		-	or satisfied. The lessee's right to remove the casing is
606		-	subject to the provision of Paragraph 11 above.
607		-	14. Upon failure or default of the lessee to comply
	620	+	require that all or any part of the casing shall be left in any
	621	+	nonproductive well when the lessor deems it to the interest of
	622	+	the beneficiaries of the lands granted hereunder to maintain
	623	+	[said] the well or wells for water. For such casing so left in
	624	+	wells the lessor shall pay to the lessee the reasonable value
	625	+	thereof.
	626	+	[11.] 12. The lessee shall be liable and agree to pay for
	627	+	all damages to the range, livestock, growing crops or
	628	+	improvements caused by the lessee's operations on [said ] the
	629	+	lands. When requested by the lessor, the lessee shall bury
	630	+	pipelines below plow depth.
	631	+	[12.] 13. The lessee shall not remove any machinery or
	632	+	fixtures placed on [said ] the premises, nor draw the casing
	633	+	from any well unless and until all payments and obligations due
	634	+	the lessor under the terms of this agreement shall have been
	635	+	paid or satisfied. The lessee's right to remove the casing is
	636	+	subject to the provision of Paragraph [10 ] 11 above.
	637	+	[13.] 14. Upon failure or default of the lessee to comply
608	638		with any of the provisions or covenants hereof, the lessor is
609	639		hereby authorized to cancel this lease and such cancellation
610	640		shall extend to and include all rights hereunder as to the
611		-	whole of the tract so claimed, or possessed by the lessee,
612		-	but shall not extend to, nor affect the rights of any other SFC/SB 23
613		-	Page 13
	641	+	whole of the tract so claimed, or possessed by the lessee, but
	642	+	shall not extend to, nor affect the rights of any other lessee
	643	+	or assignee claiming any portion of the lands upon which no
	644	+	default has been made; provided, however, that before any such
	645	+	.229493.3SA
	646	+	- 12 - underscored material = new
	647	+	[bracketed material] = delete
614	648		1
615	649		2
616	650		3
617	651		4
618	652		5
619	653		6
620	654		7
621	655		8
622	656		9
623	657		10
624	658		11
625	659		12
626	660		13
627	661		14
628	662		15
629	663		16
630	664		17
631	665		18
632	666		19
633	667		20
634	668		21
635	669		22
636	670		23
637	671		24
638	672		25
639		-	lessee or assignee claiming any portion of the lands upon
640		-	which no default has been made; provided, however, that
641		-	before any such cancellation shall be made, the lessor shall
642		-	mail to the lessee so defaulting, by registered or certified
643		-	mail, addressed to the post office address of such lessee as
644		-	shown by the records of the state land office, a notice of
645		-	intention of cancellation specifying the default for which
646		-	cancellation is to be made, and if within thirty days from
647		-	the date of mailing the notice the lessee shall remedy the
648		-	default specified in the notice, cancellation shall not be
649		-	made.
650		-	15. If this lease shall have been maintained in
651		-	accordance with the provisions hereof and if at the
652		-	expiration of the primary term provided for herein oil or gas
653		-	is not being produced on the land but the lessee is then
654		-	engaged in bona fide drilling or reworking operations
655		-	thereon, this lease shall remain in full force and effect so
656		-	long as such operations are diligently prosecuted and, if
657		-	they result in the production of oil or gas, so long
658		-	thereafter as oil and gas in paying quantities, or either of
659		-	them, is produced from the land; provided, however, such
660		-	operations extending beyond the primary term shall be
661		-	approved by the lessor upon written application filed with
662		-	the lessor on or before the expiration of the term, and a
663		-	report of the status of all of such operations shall be made SFC/SB 23
664		-	Page 14
	673	+	cancellation shall be made, the lessor shall mail to the lessee
	674	+	so defaulting, by registered or certified mail, addressed to
	675	+	the post office address of such lessee as shown by the records
	676	+	of the state land office, a notice of intention of cancellation
	677	+	specifying the default for which cancellation is to be made,
	678	+	and if within thirty days from the date of mailing [said ] the
	679	+	notice the [said] lessee shall remedy the default specified in
	680	+	[said] the notice, cancellation shall not be made.
	681	+	[14.] 15. If this lease shall have been maintained in
	682	+	accordance with the provisions hereof and if at the expiration
	683	+	of the primary term provided for herein oil or gas is not being
	684	+	produced on [said] the land but the lessee is then engaged in
	685	+	bona fide drilling or reworking operations thereon, this lease
	686	+	shall remain in full force and effect so long as such
	687	+	operations are diligently prosecuted and, if they result in the
	688	+	production of oil or gas, so long thereafter as oil and gas in
	689	+	paying quantities, or either of them, is produced from [said ]
	690	+	the land; provided, however, such operations extending beyond
	691	+	the primary term shall be approved by the lessor upon written
	692	+	application filed with the lessor on or before the expiration
	693	+	of [said] the term, and a report of the status of all of such
	694	+	operations shall be made by the lessee to the lessor every
	695	+	thirty days and a cessation of such operations for more than
	696	+	twenty consecutive days shall be considered as an abandonment
	697	+	of such operations and this lease shall thereupon terminate.
	698	+	.229493.3SA
	699	+	- 13 - underscored material = new
	700	+	[bracketed material] = delete
665	701		1
666	702		2
667	703		3
668	704		4
669	705		5
670	706		6
671	707		7
672	708		8
673	709		9
674	710		10
675	711		11
676	712		12
677	713		13
678	714		14
679	715		15
680	716		16
681	717		17
682	718		18
683	719		19
684	720		20
685	721		21
686	722		22
687	723		23
688	724		24
689	725		25
690		-	by the lessee to the lessor every thirty days and a cessation
691		-	of such operations for more than twenty consecutive days
692		-	shall be considered as an abandonment of such operations and
693		-	this lease shall thereupon terminate.
694		-	If during the drilling or reworking of any well under
695		-	this section, the lessee loses or junks the hole or well and
696		-	after diligent efforts in good faith is unable to complete
697		-	the operations, then within twenty days after the abandonment
698		-	of the operations, the lessee may commence another well
699		-	within three hundred thirty feet of the lost or junked hole
700		-	or well and drill the same with due diligence.
	726	+	If during the drilling or reworking of any well under this
	727	+	section, the lessee loses or junks the hole or well and after
	728	+	diligent efforts in good faith is unable to complete [said ] the
	729	+	operations, then within twenty days after the abandonment of
	730	+	[said] the operations, the lessee may commence another well
	731	+	within three hundred thirty feet of the lost or junked hole or
	732	+	well and drill the same with due diligence.
701	733		Operations commenced and continued as herein provided
702		-	shall extend this lease as to all lands as to which the same
703		-	is in full force and effect as of the time the drilling
	734	+	shall extend this lease as to all lands as to which the same is
	735	+	in full force and effect as of the time [said ] the drilling
704	736		operations are commenced; provided, however, this lease shall
705		-	be subject to cancellation in accordance with Paragraph 14
706		-	hereof for failure to pay rentals or file reports that ~~may~~
707		-	become due while operations are being conducted hereunder.
708		-	16. Should production of oil and gas or either of ~~them~~
709		-	in paying quantities be obtained while this lease is in ~~force~~
710		-	and effect and should thereafter cease from any cause ~~after~~
711		-	the expiration of five years from the date hereof, this ~~lease~~
712		-	shall not terminate if the lessee commences additional
	737	+	be subject to cancellation in accordance with Paragraph [13 ] 14
	738	+	hereof for failure to pay rentals or file reports [which ] that
	739	+	may become due while operations are being conducted hereunder.
	740	+	[15.] 16. Should production of oil and gas or either of
	741	+	them in paying quantities be obtained while this lease is in
	742	+	force and effect and should thereafter cease from any cause
	743	+	after the expiration of five years from the date hereof, this
	744	+	lease shall not terminate if the lessee commences additional
713	745		drilling or reworking operations within sixty days after the
714		-	cessation of such production and shall remain in full force SFC/SB 23
715		-	Page 15
	746	+	cessation of such production and shall remain in full force and
	747	+	effect so long as such operations are prosecuted in good faith
	748	+	with no cessation of more than twenty consecutive days, and if
	749	+	such operations result in the production of oil or gas in
	750	+	paying quantities, so long thereafter as oil or gas in paying
	751	+	.229493.3SA
	752	+	- 14 - underscored material = new
	753	+	[bracketed material] = delete
716	754		1
717	755		2
718	756		3
719	757		4
720	758		5
721	759		6
722	760		7
723	761		8
724	762		9
725	763		10
726	764		11
727	765		12
728	766		13
729	767		14
730	768		15
731	769		16
732	770		17
733	771		18
734	772		19
735	773		20
736	774		21
737	775		22
738	776		23
739	777		24
740	778		25
741		-	and effect so long as such operations are prosecuted in good
742		-	faith with no cessation of more than twenty consecutive days,
743		-	and if such operations result in the production of oil or gas
744		-	in paying quantities, so long thereafter as oil or gas in
745		-	paying quantities is produced from the land; provided,
746		-	however, written notice of intention to commence such
747		-	operations shall be filed with the lessor within thirty days
748		-	after the cessation of such production, and a report of the
749		-	status of such operations shall be made by the lessee to the
750		-	lessor every thirty days, and the cessation of such
751		-	operations for more than twenty consecutive days shall be
752		-	considered as an abandonment of such operations and this
753		-	lease shall thereupon terminate.
754		-	17. Lessees, including their heirs, assigns, agents and
755		-	contractors, shall at their own expense fully comply with all
756		-	laws, regulations, rules, ordinances and requirements of the
757		-	city, county, state and federal authorities and agencies, in
758		-	all matters and things affecting the premises and operations
759		-	thereon that may be enacted or promulgated under the
	779	+	quantities is produced from [said ] the land; provided, however,
	780	+	written notice of intention to commence such operations shall
	781	+	be filed with the lessor within thirty days after the cessation
	782	+	of such production, and a report of the status of such
	783	+	operations shall be made by the lessee to the lessor every
	784	+	thirty days, and the cessation of such operations for more than
	785	+	twenty consecutive days shall be considered as an abandonment
	786	+	of such operations and this lease shall thereupon terminate.
	787	+	[16.] 17. Lessees, including their heirs, assigns, agents
	788	+	and contractors, shall at their own expense fully comply with
	789	+	all laws, regulations, rules, ordinances and requirements of
	790	+	the city, county, state and federal authorities and agencies,
	791	+	in all matters and things affecting the premises and operations
	792	+	thereon [which] that may be enacted or promulgated under the
760	793		governmental police powers pertaining to public health and
761		-	welfare, including but not limited to conservation,
762		-	sanitation, aesthetics, pollution, cultural properties, fire
763		-	and ecology. Such agencies are not to be deemed third party
764		-	beneficiaries hereunder, however this clause is enforceable
765		-	by the lessor in any manner provided in this lease or by law. SFC/SB 23
766		-	Page 16
	794	+	welfare, including but not limited to conservation, sanitation,
	795	+	aesthetics, pollution, cultural properties, fire and ecology.
	796	+	Such agencies are not to be deemed third party beneficiaries
	797	+	hereunder, however this clause is enforceable by the lessor in
	798	+	any manner provided in this lease or by law.
	799	+	[17.] 18. Should the lessor desire to exercise its rights
	800	+	to take in-kind its royalty share of oil, gas or associated
	801	+	substances or purchase all or any part of the oil, gas or
	802	+	associated substances produced from the lands covered by this
	803	+	lease, the lessee hereby irrevocably consents to the lessor
	804	+	.229493.3SA
	805	+	- 15 - underscored material = new
	806	+	[bracketed material] = delete
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792		-	18. Should the lessor desire to exercise its rights to
793		-	take in-kind its royalty share of oil, gas or associated
794		-	substances or purchase all or any part of the oil, gas or
795		-	associated substances produced from the lands covered by this
796		-	lease, the lessee hereby irrevocably consents to the lessor
797	832		exercising its right. Such consent is a consent to the
798		-	termination of any supplier/purchaser relationship between
799		-	~~the~~ lessor and the lessee deemed to exist under federal
	833	+	termination of any supplier/purchaser relationship between the
	834	+	lessor and the lessee deemed to exist under federal
800	835		regulations. The lessee further agrees that it will require
801		-	any purchaser of oil, gas or associated substances to
802		-	~~likewise~~ waive any such rights.
803		-	19. The lessor reserves a continuing option to ~~purchase~~
804		-	at any time and from time to time, at the market price
805		-	prevailing in the area on the date of purchase, all or any
806		-	~~part~~ of the minerals (oil and gas) that will be produced from
807		-	~~the~~ lands covered by this lease.
808		-	20. The lessor reserves the right to execute leases ~~for~~
809		-	geothermal resource development and operation thereon; the
	836	+	any purchaser of oil, gas or associated substances to likewise
	837	+	waive any such rights.
	838	+	[18.] 19. The lessor reserves a continuing option to
	839	+	purchase at any time and from time to time, at the market price
	840	+	prevailing in the area on the date of purchase, all or any part
	841	+	of the minerals (oil and gas) that will be produced from the
	842	+	lands covered by this lease.
	843	+	[19.] 20. The lessor reserves the right to execute leases
	844	+	for geothermal resource development and operation thereon; the
810	845		right to sell or dispose of the geothermal resources of such
811	846		lands; and the right to grant rights of way and easements for
812	847		these purposes.
813		-	21. All terms of this agreement shall extend to and
	848	+	[20.] 21. All terms of this agreement shall extend to and
814	849		bind the heirs, executors, administrators, successors and
815	850		assigns of the parties hereto.
816		-	In witness whereof, the party of the first part has SFC/SB 23
817		-	Page 17
	851	+	In witness whereof, the party of the first part has
	852	+	[hereunto] signed and caused its name to be signed by its
	853	+	commissioner of public lands [thereunto ] duly authorized, with
	854	+	the seal of [his] office affixed, and the lessee has signed
	855	+	this agreement the day and year first above written.
	856	+	STATE OF NEW MEXICO
	857	+	.229493.3SA
	858	+	- 16 - underscored material = new
	859	+	[bracketed material] = delete
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843		-	signed and caused its name to be signed by its commissioner
844		-	of public lands duly authorized, with the seal of office
845		-	affixed, and the lessee has signed this agreement the day and
846		-	year first above written.
847		-	STATE OF NEW MEXICO
848		-	By__________________________________
	885	+	By___________________________________
849	886		Commissioner of Public Lands, Lessor
850		-	____________________________________
	887	+	_____________________________________
851	888		_____________________________(Seal)
852	889		Lessee"."
853		-	SECTION 2. Section 19-10-17 NMSA 1978 (being Laws 1929,
854		-	Chapter 125, Section 8, as amended) is amended to read:
855		-	"19-10-17. PUBLIC SALE OF RESTRICTED DISTRICT LEASES--
856		-	TIME--REGULATIONS--NOTICE--MINIMUM BONUS--SEALED BIDS OR
857		-	PUBLIC AUCTION AUTHORIZED--SITE OF SALE--PUBLICATION OF
858		-	NOTICE--REJECTION OF BIDS--COMPLETION OF TRANSACTION.--
859		-	A. The commissioner shall hold a public sale of
860		-	oil and gas leases upon lands that may be open to lease and
861		-	embraced within the restricted district or districts created
862		-	and that may be created under Section 19-10-16 NMSA 1978 on
863		-	the third Tuesday of each month or on the next business day
864		-	following, where the third Tuesday falls on a legal holiday,
865		-	and shall offer for lease such lands in designated tracts to
866		-	the highest and best bidder. All sales of leases upon
867		-	competitive bidding or a public auction shall be governed by SFC/SB 23
868		-	Page 18
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894		-	regulations issued by the commissioner not in conflict with
895		-	the provisions of Chapter 19, Article 10 NMSA 1978. Notice
896		-	of such sales shall be given by posting in a conspicuous
897		-	place in the state land office, not less than ten days before
898		-	the date of sale, a notice of the sale specifying the day and
899		-	hour when and the place where the sale will be held and
900		-	specifying the following for each tract to be offered for
901		-	lease:
902		-	(1) a description of the lands;
903		-	(2) the form of lease to be used;
904		-	(3) the royalty rate; and
905		-	(4) the annual rental per acre to be paid.
906		-	B. The commissioner may, when it is deemed to be
907		-	for the best interests of the beneficiaries of such lands,
908		-	also specify a minimum bonus to be paid for the leases upon
909		-	the respective tracts, and, when so specified, the bonus
910		-	shall be paid in addition to the first year's rental. The
911		-	notice shall also contain such other information as the
912		-	commissioner may deem advisable or necessary. Sales may be
913		-	conducted through sealed bids or at public auction or by both
914		-	methods combined, but the method of conducting each sale
915		-	shall be stated in the notice of sale required pursuant to
916		-	this section. Sales may be held at the option of the
917		-	commissioner either in the office of the commissioner or at
918		-	the county seat of the county in which the lands, or the SFC/SB 23
919		-	Page 19
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945		-	greater part thereof, are situated or such other place within
946		-	the state as the commissioner may designate in the notice of
947		-	public auction provided for in this section. The
948		-	commissioner is authorized to give such additional notice of
949		-	the sales, either by publication in newspapers or by mailing
950		-	copies of the notice of sale to interested persons, firms or
951		-	corporations, as the commissioner may deem necessary to give
952		-	proper publicity thereto. The commissioner shall have the
953		-	right to reject all bids received at any sale for the lease
954		-	upon any tract but shall not reject any bids made in
955		-	conformity with the regulations and provisions of Chapter 19,
956		-	Article 10 NMSA 1978 without rejecting all bids applicable to
957		-	the same tract of land. Leases sold at sales as provided in
958		-	this section shall be awarded to the respective bidders
959		-	offering the largest bonus, which shall be paid in addition
960		-	to the first year's rental, or, where a minimum bonus is not
961		-	specified and no offer of a bonus is received, to the bidder
962		-	offering the rental specified in the notice of sale that, for
963		-	the first year, shall not be less than one hundred dollars
964		-	($100) for each lease as provided in Section 19-10-15 NMSA
965		-	1978. Where two or more sealed bids making the same offer
966		-	for the same tract are received, the commissioner shall award
967		-	the lease in accordance with such regulations as the
968		-	commissioner may prescribe. The successful bidders shall
969		-	file proper applications for the leases purchased and shall SFC/SB 23
970		-	Page 20
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996		-	complete the payment of any balance due on their bids before
997		-	the closing of the office of the commissioner on the day of
998		-	the sale.
999		-	C. The individual percentages and total percentage
1000		-	for each factor, pursuant to Section 19-10-3 NMSA 1978, shall
1001		-	be posted in conjunction with the lease notice for each
1002		-	individual tract nomination in a manner that keeps
1003		-	confidential the identity of the nominating company."
1004		-	SECTION 3. EFFECTIVE DATE.--The effective date of the
	890	+	SECTION 2. EFFECTIVE DATE.--The effective date of the
1005	891		provisions of this act is July 1, 2025.
	892	+	- 17 -
	893	+	.229493.3SA