§212 Surveys; Royalties; Time Payable; Annual Rentals; Term of Leases; Readjustment on Renewals; Minimum Production; Suspension of Operation

Summary

Each lease must describe the land using the legal public-land survey divisions. Royalties must be set by the Secretary of the Interior before the lease is offered and cannot be less than 5% of the gross value of phosphates, phosphate rock, and related minerals. The lease must say whether royalties are paid monthly or quarterly. Payments are due on the last day of the month after the month or quarter when the minerals were sold or removed. Each lease must also charge a rental due when the lease starts and each year after: at least $0.25 per acre the first year, $0.50 per acre the second and third years, and $1.00 per acre each year after that. Rental payments count toward that year’s royalties. Leases run for 20 years and continue if the lessee follows the rules. At the end of each 20-year period, the Secretary can make reasonable changes to the lease terms. Leases must require a minimum yearly production or a minimum royalty if production is low, except when stoppages are caused by strikes, weather, or other accidents beyond the lessee’s control. The Secretary can allow operations to be paused when market conditions would force a loss.