27-671. Provisions of lease
A. The leases shall provide for the payment by the lessee of a royalty of not less
than twelve and one-half per cent of the gross value of the resource at the well head.
B. The leases shall provide for an annual rental of not less than one dollar per
acre for each year that the lease is in effect.
C. The leases shall be for a primary term of ten years and as long thereafter as
geothermal resources are procured and produced in paying quantities from the leased
lands. The lease upon which drilling operations are being diligently prosecuted on the
expiration date shall continue in effect for a period of two years and so long as
geothermal resources are procured and produced in paying quantities from such lands.
D. The leases shall contain other terms and provisions, not inconsistent with the
provisions of this article or other laws of this state, as in the opinion of the
department are for the best interest of this state.
E. Not more than two thousand five hundred sixty acres of land shall be included in
any one lease. The leased lands shall be in as compact a body as possible but may
include noncontiguous land.
F. Each lease shall provide that any combination, understanding or agreement
entered into by the lessee, written, verbal or otherwise, for the purpose of delaying
discovery or development of geothermal resources is an illegal practice, and that upon
legal determination of such practice shall constitute grounds for cancellation of the
lease. Appropriate proceedings shall be instituted by the attorney general against the
lessee in the county in which the land or any part of such land is located. The
provisions of this section shall not apply to a unit plan or operation entered into under
the provisions of this article or to any plan or operation authorized by any conservation
law of this state.
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