the full amount of the bonus and the first year’s rental or the minimum royalty, as
applicable, within 10 business days from the date the department notifies the successful
bidder. Bidders who have an established credit rating with the department through prior
leasing activity, or units of government, may pay the total amount due by cash, certified
check, personal check, or company check. Bidders may also establish a credit rating with
the department by filing 3 acceptable credit references with the department, 1 of which
shall be from a bank. Bidders who do not have an established credit rating with the
department shall pay the entire amount due by cash or certified check.
(5) Failure of the successful bidder to pay the total bonus and the first year’s rental or
the minimum royalty, as applicable, by the close of open oral lease auctions or within 10
business days from the date the successful bidder is notified by the department for sealed
bid lease auctions may result in the forfeiture of the lease rights to the lands involved and
may result in the bidder being placed on the hold action list. Placement on the hold
action list may bar the bidder from any further leases, assignments, easements,
extensions, or other discretionary approvals requested of the department. Lands on which
lease rights have been forfeited may be offered to the back-up bidder at the department’s
(6) The department may reject any bid or stop the auction of any offered lease rights at
any time in the department’s sole discretion.
History: 1987 AACS.; 2019 AACS.
R 299.4025 Direct nonmetallic minerals leases.
Rule 5. The department may enter direct nonmetallic mineral leases.
History: 1987 AACS; 2019 AACS.
R 299.4026 Awarding of leases.
Rule 6. (1) Department approval is required before any lease is issued.
(2) The department may group approved lease rights into 1 or more leases, depending
on the location of the lease rights and any special lease conditions.
(3) Before a lease shall be executed for any approved lease rights, the successful bidder
shall file with the department a performance bond acceptable to the department. The
department shall specify the amount of performance bond, maximum acreage covered,
and when and how the bond may be drawn upon.
(4) The department shall provide the original lease instrument to the proposed lessee for
signature. Unless otherwise agreed to in writing by the department, the proposed lessee
shall return the properly executed lease instrument and, for direct leases, the bonus and
rental due or the minimum royalty, as applicable, within 30 calendar days from the date
the department sent the lease instrument.
(5) If the proposed lessee is unable to return the lease instrument and amount due
within the time specified, the department may, upon request of the proposed lessee,
authorize additional time if the department determines the delay is not the fault of the
proposed lessee. Failure of the proposed lessee to comply within time limits authorized
shall result in forfeiture of the entire bonus and first year’s rental or the minimum royalty,