Sec. 66.71. LEASE PROVISIONS. (a) An oil and gas lease issued by the board shall provide for payment of a delay rental. During the primary term of the lease, the lease shall terminate on the anniversary date of the lease unless:
(1) oil or gas is being produced in paying quantities from the leased premises;
(2) drilling operations are being conducted on the leased premises; or
(3) the lessee pays timely in the manner provided in the lease the amount of delay rental stated in the lease.
(b) If oil or gas is discovered in paying quantities on any tract covered by a lease, the lease as to that tract shall remain in force as long as oil and gas is produced in paying quantities from the tract, provided that the other provisions of this subchapter are complied with by the lessee.
(c) An oil and gas lease issued by the board shall provide that royalty may be taken in kind at any time and from time to time at the discretion of the board in the manner provided in this subchapter.
Amended by Acts 1997, 75th Leg., ch. 1324, Sec. 1, eff. Jan. 1, 1998.
Structure Texas Statutes
Subtitle C - The University of Texas System
Chapter 66 - Permanent University Fund
Subchapter D. Board for Lease of University Lands
Section 66.62. Board for Lease of University Lands
Section 66.63. Certain Board Actions
Section 66.64. Powers and Duties of the Board
Section 66.65. Board Staff; Exchange of Information With State Agencies
Section 66.68. Marginal Property Royalty Rates
Section 66.71. Lease Provisions
Section 66.72. Cessation of Production; Drilling and Reworking
Section 66.73. Shut-in Royalty
Section 66.74. Lease Extension or Suspension
Section 66.75. Protection From Drainage; Compensatory Royalties
Section 66.76. Assignment; Relinquishment
Section 66.77. Royalty Payments and Reports
Section 66.78. Interest and Penalties
Section 66.79. Payment of Royalty in Kind
Section 66.81. Audit Information Confidential
Section 66.82. Forfeiture; Other Remedies