Subject to the exceptions listed below, geothermal leases may be issued in combination or separately for (a) lands administered by the Secretary of the Interior; (b) national forest lands or other lands administered by the Department of Agriculture through the Forest Service; and (c) geothermal resources in lands which have been conveyed by the United States subject to a reservation to the United States of geothermal resources. § 3201.1-2 Department of the Interior.

(a) Except as provided in this section, leases may be issued in accordance with the regulations in this part for withdrawn lands, for acquired lands, and for geothermal resources in lands which have passed from Federal ownership subject to a reservation to the United States of the geothermal resources therein where such lands or resources are administered by the Secretary of the Interior.

(b) Notwithstanding any other provision in these regulations, geothermal leases shall not be issued for:

(1) Lands which the Secretary has identified or may identify as being necessary to the performance of his or any other Federal officer's authorized functions, and on which geothermal resource development would in his judgment interfere with such functions; or (2) lands respecting which the Secretary has made or may make a finding that the issuance of geothermal leases would be contrary to the public interest. Upon receipt of an application for a geothermal lease affecting lands withdrawn under section 3 of the Reclamation Act of 1902 (43 U.S.C. 416) or any other appropriate authority, notice thereof and an opportunity to comment thereon shall be given to the head of the agency for whose benefit the withdrawal was made. No geothermal lease affecting lands withdrawn for any agency outside the Department of the Interior shall be leased without the consent of the head

of the agency for which the lands are withdrawn. Where leases are issued under Part 3210 of this chapter or Part 3220 for lands neighboring such reserved lands, the lessees shall be required to perform such lease operations and take such measures as are prescribed by the Secretary for the protection of the Federal interests therein.

§ 3201.1-3 Department of Agriculture.

Leases for public, withdrawn or acquired lands administered by the Forest Service, may be issued by the Secretary of the Interior only with the consent of, and subject to such terms and conditions as may be prescribed by, the head of that Department to insure adequate utilization of the lands for the purpose for which they were withdrawn or acquired.

§ 3201.1-4 Federal Power Commission.

Leases for lands to which section 24 of the Federal Power Act, as amended (16 U.S.C. 818), is applicable, may be issued by the Secretary of the Interior only with the consent of, and subject to, such terms and conditions as the Federal Power Commission may prescribe to insure adequate utilization of such lands for power and related purposes.

§ 3201.1-5 Patented lands.

(a) Geothermal resources in lands which have passed from Federal ownership subject to a reservation to the United States of geothermal resources therein may be leased under the regulations in this group subject to the provisions in this part and to such terms and conditions as may be prescribed by the authorized officer to insure adequate protection of the patented lands and any improvements thereon.

(b) Geothermal resources in lands the surface of which has passed from Federal ownership but in which the minerals have been reserved to the United States shall not be developed or produced except under terms and conditions prescribed by the Secretary and pursuant to any agreements made therefor while the question of the title to such resources is being resolved

pursuant to the provisions of section 21(b) of the Act.

§ 3201.1-6 Excepted areas.

Leases shall not be issued for lands which are: (a) Administered under the National Park System; (b) within a national recreation area; (c) in a fish hatchery administered by the Secretary, wildlife refuge, wildlife range, game range, wildlife management area, or waterfowl production area, or for lands acquired or reserved for the protection and conservation of fish and wildlife which are designated as rare and endangered species by the Secretary; or under active consideration for inclusion in categories (a), (b), or (c) as evidenced by the filing of an application for a withdrawal or a proposed withdrawal; or (d) tribally or individually owned Indian trust or restricted lands, within or without the boundaries of Indian reservations.

§ 3201.2 Acreage limitations.

(a) Maximum holdings. No citizen, association, corporation, or governmental unit shall take, hold, own, or control at one time, whether acquired directly from the Secretary or otherwise, any direct or indirect interest in Federal geothermal leases in any one State exceeding 20,480 acres, including leases acquired under the provisions of section 4(a)-(f) of the Act. Nor may any citizen, association, or corporation be permitted to convert mineral leases, permits, applications therefor, or mining claims, pursuant to the provisions of section 4(a)-(f) of the Act into geothermal leases for more than 10,240 acres.

(b) Computation. In computing acreage holdings or control, the accountable acreage of a party owning an undivided interest in a lease shall be that party's proportionate part of the total lease acreage. Likewise, the accountable acreage of a party owning an interest in a corporation or association shall be his proportionate part of the corporation's or association's accountable acreage except that no person shall be charged with his pro rata share of any acreage holdings of any association or corporation unless he is the beneficial owner of more than 10 per centum of the stock or other in

struments of ownership or control of that association or corporation. Parties owning a royalty or other interest determined by or payable out of a percentage of production from a lease will be charged with a similar percentage of the total lease acreage.

(1) An association shall not be deemed to exist between the parties to a contract for development of leased lands, whether or not coupled with an interest in the lease, nor between colessees, but each party to any such contract or each co-lessee will be charged with his proportionate interest in the lease.

(2) Lessees holding acreage in common shall be considered a single entity and cannot hold acreage in excess of the maximum specified in the law for any one lessee.

(c) Excepted acreage. Leases committed to any unit or cooperative plan approved or prescribed by the Secretary of the Interior shall not be included in computing accountable acreage. Leases subject to an operating, drilling or development contract approved by the Secretary pursuant to section 18 of the Act, other than communization or drilling agreements, shall be excepted in determining the accountable acreage of the lessees or operators.

(d) Excess acreage. (1) Where, as the result of the termination or contraction of a unit or cooperative plan, or the elimination of a lease from operating, drilling, or development plan, a party holds or controls excess accountable acreage, such party shall have 90 days from such termination or contractions or elimination in which to reduce his holdings to the prescribed limitation.

(2) If any person holding or controlling leases or interests in leases is found to hold accountable acreage in violation of the provisions of this section and of the Act, the last lease or leases or interest or interests acquired by him which created the excess acreage holdings shall be canceled or forfeited in their entirety, even though only part of the acreage in the lease or interest constitutes excess holdings, unless it can be shown to the satisfaction of the Director that the holding or control of the excess acreage is not the result of negligence or willful

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intent in which event the lease or leases shall be canceled only to the extent of the excess acreage.

(3) Any person holding or controlling leases or interests in leases below the acreage limitation provided in this section, shall be subject to these rules: (i) If he files an application which causes him to exceed the acreage limitation, that application will be rejected.

(ii) If he files a group of applications at the same time, any one of which causes him to exceed the acreage limitation, the entire group of applications will be rejected.

(4) If any person holding or controlling leases or interests in leases below the acreage limitation provided in this section, acquires a lease or leases, or an interest or interests therein, which cause him to exceed the acreage limitation, his most recently filed application for lease or applications for leases then containing acreage in excess of the limitation provided in this section will be rejected in its or their entirety. For the purpose of this paragraph, time of filing shall be determined by the date of filing marked on the application, or, if the same date is marked on two or more applications, by the serial number of the applications.

(e) Showing required. No lease will be issued and no transfer or operating agreement will be approved until it has been shown that the applicant, operator, or transferee is entitled to hold the acreage or obtain the operating rights. At any time upon request by the authorized officer, the record title holder of any lease or a lease operator or a lease applicant may be required to file in the proper BLM office a statement, showing as of a specified date the serial number and the date of each lease of which he is the record holder, or under which he holds operating rights, and each application for lease held or filed by him in the particular State setting forth the acreage covered thereby, and the nature, extent and acreage interest, including royalty interests held by him in any geothermal lease of which the reporting party is not the lessee of record, whether by corporate stock ownership, interest in unincorporated associations and partnerships, or in any other manner.

§ 3201.3 Leases within unit areas.

Before issuance of a geothermal lease for lands within an approved unit agreement, the lease applicant or successful bidder will be required to file evidence that he has entered into an agreement with the unit operator for the development and operation of the lands in a lease if issued to him under and pursuant to the terms and provisions of the approved unit agreement, or a statement giving satisfactory reasons for the failure to enter into such agreement. If such statement is acceptable, he will be permitted to operate independently but will be required to perform his operations in a manner which the Supervisor deems to be consistent with the unit operations.

(a) Each applicant for a lease is required to submit with his application a statement that his interests, direct and indirect, in Federal geothermal leases do not exceed the acreage limitations prescribed in § 3201.2, together with a statement of his citizenship.

(b) If the applicant is an association or corporation the application must be accompanied by:

(1) A statement showing that it is authorized to hold geothermal leases; (2) a statement that the officer executing the application is authorized to act on behalf of the association or corporation; (3) a statement setting forth the State in which it was incorporated or formed and the names and

addresses of all members or stockholders holding more than 10 percent of the association or corporation; and (4) a statement from each person owning or controlling more than 10 percent of the association or corporation setting forth his citizenship and his holdings. (c) If the applicant is a municipality, or governmental unit, the application must be accompanied by:

(1) A statement showing that it is authorized to hold geothermal leases; (2) a statement that the officer executing the application is authorized to act on behalf of the municipality or governmental unit, and (3) a copy of its governing body's resolution authorizing such action.

§ 3202.2-2 Guardian or trustee.

(a) Guardian. If the application is made by a guardian, he must submit:

(1) A certified copy of the court order authorizing him to act as guardian and in behalf of his ward, to enter into contractual agreements and to fulfill all obligations arising under the lease; and (2) statements as to the citizenship and holdings under the Act of himself and of each person under his guardianship for whom the application is made.

(b) Trustee. If the application is made by a trustee, he must submit a copy of the instrument establishing the trust or a certified copy of the court order authorizing him to act as trustee, in behalf of the beneficiary, as to all obligations arising under the lease; and statements as to the citizenship and holdings under the Act of himself and of each beneficiary.

§ 3202.2-3 Attorney-in-fact.

If an application is filed by an attorney-in-fact, it must be accompanied by a statement as to his authority to act.

§ 3202.2-4 Statements previously filed.

Where the statements required by § 3202.2 have been previously filed a reference by serial number to the record in which they have been filed, together with a statement as to any amendments will be accepted.

§ 3202.2-5 Showing as to sole party in interest.

Each application must indicate whether the applicant is the sole party in interest. Where the applicant is not the sole party in interest, separate statements must be signed by each of the parties and by the applicant setting forth the nature of the agreement between them. All interested parties must furnish evidence of their qualifications to hold such lease interest. These separate statements must be filed in the proper BLM office with the application, except as provided in § 3211.2 of this chapter.

§ 3202.2-6 Heirs and devisees (estates).

If an applicant or a successful bidder dies before the lease is issued, the lease will be issued to the executor or administrator of the estate if probate of the estate has not been completed, and if probate has been completed, or is not required, to the heirs or devisees, provided there is filed in all cases an application to lease in compliance with the requirements of this section which will be effective as of the effective date of the original application filed by the deceased. If there are any minor heirs or devisees, the application can only be made by their legal guardian or trustee in his name. Each such application must be accompanied by the following information:

(a) Where probate of the estate has not been completed:

(1) Evidence that the person who as executor or administrator submits the application, and bond form if a bond is required, has authority to act in that capacity and to sign the application and bond forms.

(2) A statement over the signature of each heir or devisee or, if the heir or devisee is a minor, over the signature of his legal guardian or trustee, concerning citizenship and holdings.

(3) Evidence that the heirs or devisees are the heirs or devisees of the deceased applicant or successful bidder and are the only heirs or devisees of the deceased.

(b) Where the executor or administrator has been discharged or no probate proceedings are required:

(1) A certified copy of the will or decree of distribution, if any, and if not, a statement signed by the heirs that they are the only heirs of the applicant or successful bidder and the provisions of the law of the deceased's last domicile showing that no probate is required.

(2) A statement over the signature of each of the heirs or devisees with reference to holdings and citizenship. If the heir or devisee is a minor, the statement must be over the signature of the guardian or trustee.

§ 3202.2-7 Fractional present interests.

(a) An application for a fractional present interest noncompetitive lease must be executed on a form approved by the Director and it must be accompanied by a statement showing the extent of the applicant's ownership of the operating rights to the fractional geothermal resources interest not owned by the United States in each tract covered by the application to lease. Ordinarily, the issuance of a lease to one who, upon such issuance, would own less than 50 percent of the operating rights in any such tract, will not be regarded as in the public interest, and an application leading to such results will be rejected.

(b) Geothermal resources in lands which have passed from Federal ownership but which lands have been purchased by the Federal Government with a fractional interest in the geothermal resources shall not be developed or produced, except under prescribed terms and conditions and pursuant to any agreement made between the parties of interest prior to the resolution of the question of ownership of the geothermal resources.

Subpart 3203-Leasing Terms

§ 3203.1 Primary and additional term. § 3203.1-1 Dating of leases.

All geothermal leases will be dated as of the first day of the month following the date on which the leases are signed on behalf of the lessor except that, where prior written request has been made, a lease may be dated as of the first day of the month within which it is so signed. A renewal

lease will be dated from the termination of the original lease.

§ 3203.1-2 Primary term.

All leases shall be for a primary term of 10 years.

§ 3203.1-3 Additional term.

(a) If geothermal steam is produced or utilized in commercial quantities within the primary term of a lease, that lease shall continue for so long thereafter as geothermal steam is produced or utilized in commercial quantities, but the lease shall in no event continue for more than 40 years after the end of the primary term except that the lessee shall have a preferential right to a renewal of his lease for a second 40-year term upon such terms and conditions as the authorized officer deems appropriate, if at the end of the first 40-year term the lands are not needed for another purpose and geothermal steam is produced or utilized in commercial quantities. Production or utilization of geothermal steam in commercial quantities shall deemed to include the completion of one or more wells producing or capable of producing geothermal steam in commercial quantities and a bona fide sale of such geothermal steam for delivery to or utilization by a facility or facilities not yet installed but scheduled for installation not later than 15 years from the date of commencement of the primary term of the lease.

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