Great Falls tribune., 1921-12-05
10 APPLICATIONS
FILED F0 ROLL LAND
UNDER NEW LEASES
First Public Auction Since Bill
Effective to BE in Helena
Next Friday.

Helena. Dec. 4.-Ne1t Frioay in
Helena the first competitive bidding
for state oil lands under the new leas-
ing bill will be held. At the present
time, it is said, more than 40 appli-
cations have been filed by companies
and individuals.
Under the regulations Of the new
lease, which was only adopted recently
BY the state land board. an application
is required from the person desiring
the lease, describing the lands, and ac-
check for 5000. In the event that the
lease is granted the 5000 applies as
the first years rental on 800 acres.
Now Form Different
The new lease form is quite differ
ent from the one which has been in
force Some objection has already
the provisions are much more severe
and it is contended that only com
panies with considerable capital can
afford to compete. However, under
the old form. the owner Of lease had
no opportunity to renew after the ex
piration of five years except under
competition. The rental on the old
lease was 500 per section, requiring
bond of $500 and the royalty de-
manded by the state under that form
was 10 per cent. The new rental is
5000 for ecah 800 acres, requiring
bond of $4,000 for each unit and
royalty Of l21a per cent for all oil and
gas which may be produced upon the
land.
Entitled to Renewal
The land board contends that the
feature which makes the new lease de-
CIR 1c hot In L.
complied with the provisions of the
lease. is entitled to a renewal for an
other five years and continuously so
long as he complies wiH the require
ments.
The lessee is required within one
year after obtaining the lease. to be-
gin drilling at least one we'll which
must be drilled oa depth of / 800 feet
within a period of 1S months from the
date of the lease unless oil or gas
shall be encountered and produced at
less depth. Should oil or gas not be
encountered at this time. then it is re-
quired during the next - months that
an additional 1000 feet be drilled or
event that the lessee is not disposed to
comply with this provision. he has the
privilege of So stating to the land of
flee and paying S. per acre per an
mum in lieu of the drilling and develop
ment work prescribed.
On Offset Wells
Another provision Of this lease is
that offset wells must be drilled with
in go days after the discovery and de-
velopment of wells on land contiguous
to leased state land. Failure to com
ply with this provision results in the
termination and forfeiture Of the lease.
1t is also prcvided that should an
well be developed where the
water flows from the top casing that
the lessee shall leave the casing in the
well to insure the water flow. As in
leases made by other states the lessee
is required to protect against flow of
water itno oil bearing sands.
The provision for renewal requires
the following: That the lessee shall
during the period of the lease or the
extension thereof drill a well which
shall produce oil or gas in commercial
quantities and as long as such we'll
right Of renewal under the same terms !
as the original lease. Should such
well not be developed if the lessee
show expenditure Of not less than S15.-
900 in exploration and development, he
is also entitled to renewal
The state has the option where oil |
lands are developed to increase the
bond from $1,000 up to any amount not
exceeding $4,000. This is for the
protection of the state in the pay
ment of royalties.