2023 New Mexico Statutes › Chapter 19 - Public Lands › Article 10 - Lease of Oil and Gas Lands › Section 19-10-22 - [Validation of existing leases; contest of claims; relinquishment for conversion; terms of new lease; fees.]

All oil and gas leases issued by the commissioner of public lands prior to the effective date of this amendment which have not expired, or which have not been legally canceled for nonperformance by the lessee or assignee, are hereby declared to be valid and existing contracts with the state of New Mexico according to their terms and provisions, and the obligation of the state and of the commissioner to observe and conform to the terms and provisions thereof is hereby recognized. In any case where two or more persons claim a valid lease on the same tract or tracts of land under the provisions of this section, then the rights of the conflicting claimants shall be determined by the commissioner subject to right of appeal from the decision of the commissioner as provided by law.
The legal owner and holder of any lease or leases issued by the commissioner prior to March 12, 1929, if not in default of any of the provisions thereof, may relinquish the same to the state and upon application filed at the time of filing such relinquishment, the commissioner shall issue the applicant a new lease upon the form prescribed by Section 2 of this act. The primary term of the new lease issued pursuant to such relinquishment shall be the unexpired term of the original lease and as long thereafter as oil and gas in paying quantities, or either of them, is produced from the leased premises by the lessee, and the new lease shall provide for the payment of the annual rental prevailing in the district wherein the lands affected are situated, but not less than the rental provided in the original lease. In converting such lease, as herein provided, the commissioner shall prescribe a reasonable filing fee for the filing of the relinquishment and application, and the lessee shall not be required to pay any rental in addition to the rental provided in the lease relinquished for the current year in which the lease is relinquished, except the difference, if any, between the amount of rental provided in the old lease and that to be provided in the new lease. The provisions of Chapter 125 of the 1929 Session Laws [19-10-1, 19-10-12 to 19-10-25 NMSA 1978], and of this act [19-10-1, 19-10-12, 19-10-15 to 19-10-18, 19-10-22 NMSA 1978] relating to sales of leases within a restricted district upon competitive bidding, or by sealed bids, or at public auction, shall not apply to this section.
History:
Laws 1929, ch. 125, § 14; C.S. 1929, § 132-414; Laws 1931, ch. 18, § 8; 1941 Comp., § 8-1115; 1953 Comp., § 7-11-16.
ANNOTATIONS
Bracketed material.
— The bracketed material was inserted by the compiler and is not part of the law.
Compiler's notes.
— Section 2 of this act, referred to in the first sentence of the second paragraph, had been compiled as 19-10-3 NMSA 1978. Section 19-10-3 NMSA 1978 was repealed and reenacted by Laws 1985, ch. 195, § 1.
Time to exercise surrender privilege.
— Under this statute, a lease became convertible which gave the lessee privilege to surrender at any time, although it was producing and although it would have been renewable in a few weeks at a rental higher than the statutory lease.
Harry Leonard, Inc. v. Vesely
, 1934-NMSC-090, 39 N.M. 33, 38 P.2d 1112.
Construction of 1929 act.
— The provision in Laws 1929, ch. 125, § 14 (this section prior to its amendment in 1931), that the new lease was to be "issued in lieu of" the lease surrendered, was not sufficient to render the statute ambiguous or to support the contention that the term of the new lease should be merely the unexpired portion of the original term.
Atlantic Oil Producing Co. v. Crile
, 1930-NMSC-040, 34 N.M. 650, 287 P. 696.
And effect thereof on act of 1925.
— Where Laws 1925, ch. 137, § 9, providing for surrender of old leases and issue of new leases, was amended by Laws 1927, ch. 46, § 3, with same provisions, which latter act was repealed by Laws 1929, ch. 125, § 20, which act also provided for surrender of leases issued prior to March 23, 1927, and the issue of new leases, the repeal of the amendatory act, with a substitute, did not revive the original provision.
Atlantic Oil Producing Co. v. Crile
, 1930-NMSC-040, 34 N.M. 650, 287 P. 696.