§226–1 Extension of Noncompetitive Oil or Gas Lease Issued Before September 2, 1960

Summary

Gives the person who legally holds a noncompetitive oil or gas lease issued before September 2, 1960 one extension when the lease’s initial five-year term ends. The extension only covers lands that are not withdrawn from leasing on the expiration date. A withdrawal does not stop the extension if drilling began before the withdrawal became effective and was being actively pursued on the expiration date. A withdrawal is not effective until 90 days after a notice is mailed by registered or certified mail to each affected lessee. If the land is outside the known geologic structure of a producing field, the extension is five years. If the land is inside that known structure, the extension is two years. In either case the lease then continues as long as oil or gas is produced in paying quantities. Leases where approved cooperative or unit-plan drilling began before the primary term ended and was actively pursued then get a two-year extension. Extensions follow the rules in force when the five-year term ended. To get an extension, the leaseholder—or an assignee or operator with a filed assignment or operating agreement—must apply within 90 days before the lease expires.