New Mexico HB 48: OIL AND GAS FUTURE ROYALTY RATE

Bill Text

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HOUSE BILL 48
56TH LEGISLATURE - STATE OF NEW MEXICO - SECOND SESSION, 2024
INTRODUCED BY
Matthew McQueen and Bill Tallman
AN ACT
RELATING TO PUBLIC LANDS; SETTING THE ROYALTY RATE ON FUTURE
OIL AND GAS DEVELOPMENT LEASES ON STATE TRUST LANDS TO ENHANCE
REVENUE FOR BENEFICIARIES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. Section 19-10-4.3 NMSA 1978 (being Laws 1985,
Chapter 195, Section 5) is amended to read:
"19-10-4.3. DEVELOPMENT FORM OF LEASE--PREMIUM RESTRICTED
LAND.--The following form is designed as the "Development
Form". It may be used by the commissioner for oil and gas
leases on lands classified as restricted lands and categorized
as Premium and issued on or after July 1, 2024:
"LEASE NO. _____________________ APPLICATION NO. ______________
OIL AND GAS LEASE
(Development Form)
.227184.1

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This agreement, dated ____________________, [19] 20___,
between the state of New Mexico, acting by and through its
commissioner of public lands, hereinafter called the "lessor",
and _________________________________________________________,
whose address is ____________________________________________
_____________________________________________________________,
hereinafter called the "lessee",
WITNESSETH:
WHEREAS, the lessee has filed in the office of the
commissioner of public lands an application for an oil and gas
lease covering the lands hereinafter described and has tendered
therewith the required first payment; and
WHEREAS, all of the requirements of law relative to the
application and tender have been duly complied with;
THEREFORE, in consideration of the premises as well as the
sum of _______________________________________________________
dollars ($________________), the same being the amount of the
tender above mentioned, and the further sum of $___________
filing fee, and of the covenants and agreements hereinafter
contained, the lessor does hereby grant, demise, lease and let
unto the [said] lessee, exclusively, for the sole and only
purpose of exploration, development and production of oil or
gas (including carbon dioxide and helium), or both thereon and
therefrom with the right to own all oil and gas so produced and
saved therefrom and not reserved as royalty by the lessor under
.227184.1
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the terms of this lease, together with [rights-of-way] rights
of way, easements and servitudes for pipelines, telephone
lines, tanks, power houses, stations, gasoline plants and
fixtures for producing, treating and caring for such products
and housing and boarding employees and any and all rights and
privileges necessary, incident to or convenient for the
economical operation of [said] the land, for oil and gas, with
right for such purposes to the free use of oil, gas, casing-
head gas or water from [said] the lands, but not from the
lessor's water wells, and with the rights of removing either
during or after the term hereof, all and any improvements
placed or erected on the premises by the lessee, including the
right to pull all casing, subject, however, to the covenants
and conditions hereinafter set out, the following described
land situated in the county of ___________, state of New
Mexico, and more particularly described as follows:
Line SUBDIVISION Sec. Twp. Rge. Acres Institution
1 _____________________________________________________________
2 _____________________________________________________________
3 _____________________________________________________________
4 _____________________________________________________________
5 _____________________________________________________________
6 _____________________________________________________________
7 _____________________________________________________________
[Said] The lands having been awarded to the lessee and
.227184.1
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designated as Tract No. ____________ at a public sale held by
the commissioner of public lands on ____________________, [19]
20___.
To have and to hold [said] the land, and all the rights
and privileges granted hereunder, to and unto the lessee for a
primary term of five years from the date hereof, and as long
thereafter as oil and gas, or either of them, is produced in
paying quantities from [said] the land by the lessee, subject
to all of the terms and conditions as hereinafter set forth.
In consideration of the premises, the parties covenant and
agree as follows:
1. Subject to the free use without royalty, as
hereinbefore provided, the lessee shall pay the lessor as
royalty ________ (not less than t