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8O°1( SILO URANIUM tUNING LEASE
THIS LEASE is made and entered into on this 30th day of September
19 77 , by and between the County of Weld, Colorado, a political subdivision
of the State of Colorado, by and through its Board of County Commissioners ,
Weld County Centennial Center, 915 10th Street, Greeley, Colorado 80631 ,
hereinafter called "Lessor" , and Power Resources Corporation
hereinafter called "Lessee" , WITNESSETH:
1. Interests Leased. For and in consideration of $120.00
Dollars ($ ) , receipt of which is hereby acknowledged as first
year' s rent in the amount of $ , and a bonus in the amount of
$ 120.00 , and in further consideration of Lessee ' agreement to pay
Fn One and no/100 Dollars ($ 1. 00 ) per acre annually as
rental in advance of the anniversary date of this lease until such time as
eat an advance minimum royalty becomes due under the terms of paragraph 3 of this
Lease; and in further consideration of the terms and conditions hereinafter
p e .stated , and of the payments of royalties reserved herein , to be kept and
performed by Lessee, its successors and assigns , Lessor hereby grants , leases
s and lets exclusively unto Lessee all uranium, vanadium, other fissionable
LL source materials , other spatially associated minerals , and all other min-
erals of every kind and character whatsoever, together with all deposits
thereof (which leased minerals and mineral deposits are hereinafter called
the "Subject Minerals" ) , except oil , gas , and associated liquid hydrocarbons
o and coal , in , on, and under the land described herein (which lands are here-
" inafter called the "Leased Premises" ) , and together with all rights and
i , privileges of the Lessor to enter upon the leased premises for the purpose of
_,c , surveying, exploring , .prospecting, drilling for, developing , mining , stock-
:..1 piling , removing, shipping, and marketing any of the subject minerals : all
rights of the Lessor to construct and use buildings , roads , power and com-
e.
munication lines and other improvements reasonably required by Lessee for
z the full enjoyment of the leased premises; to use so much of the surface of
ti
the leased premises in such manner as may be reasonably necessary, conven-
ient, or suitable for or incidental to any of the rights or privileges of
Lessee hereunder or otherwise reasonably necessary 'to effect the purpose of
this lease consistent with the rights of the Lessor; and together with ease-
ments and all rights of way for ingress to and egress from the leased premises to
which Lessor may be entitled: SUBJECT TO all existing easements and rights
of way of third parties , existing leases , rights and encumbrances of record ,
and rights of surface owners; and the right of Lessor to develop, explore,
produce or lease for development, exploration or production of oil , gas and
associated liquid hydrocarbons and coal , in and under the leased premises;
to the following land situated in Weld County, Colorado , to-wit:
Township 10 North, Range 62 West
Section 20: NNW' , NW'SWa ,
Containing 120 acres
LE.O 62
2_ Term of Lease. The term of this lease shall begin on the date of
execution hereinabove first written, and this lease shall continue in full
force and effect for a term of ten (10) years from such commencement date , and
- so long thereafter as any of ,the subject minerals are produced from the leased
• premises in paying quantities_ Paying quantities means producini:. -.efficient
to return royalties to Lessor equal to the advance minirn!m ftefei ,e
less than ten dollars ($10.00) per acre per year.
3- Cessation of Production_ Lessee shall notify Lessor of any cessa-
tion of production , and the reasons therefor. Cessation of production for any
reason for a period in excess of 1&0 consecutive days will automatically re-
move this lease producing status. Lessor may, upon a showing of good cause
for cessation of production by Lessee, agree, in a writing, which shall he _ .r-
nexed to this lease, i.a continue the term of this lease during such a period
despite a lack o, pruriuction of any of the subject minerals on the leased
premises, if during nl ( :: h periuc, ice rentals or advance madvace mirihum royals
ments re-;aired by paragraphs ,1E, 5 hereof shall he nt S. . rid produc
tdrn
cease for a period in excess of 1 '0 consecutive days aster the initial tee ( +0)
year term of this lease, the advance minimum royalty required to hold ; he
7705.14
Ba1/42 . OA AD 1732399
6 ,
leased premises shill he agreed upon between the parties.
Delay Rentals . So long as Lessee is not producing subject, mis-
orals from the leased premises, on or before each anniversary date of td„ t
lease for the initial five years of the lease term, Lessee shall pas' to
Lessor, by certified or cashiers check or cash, the sum of r4,
Dollars (,- :•, on ) , as delay rental ,
the same to be reduced by the amount of any royalties received by Lessor for
production from the leased premises during the preceding lease year and not
theretofore recovered by Lessee from payments by Lessor. No sight drafts
will he accepted by Lessor.
b. Advance Minimum Royalty. As minimum and advance royalty , and in
lieu of any delay rentals , without relation to the amount of uranium min:
from the leased premises , Lessee shall pay annually to Lessor the toile nee
amounts :
LEASE YEAR ADVANCE MINIMUM ROYAL.IY CEASE YEAR ADVANCE MINIMUM KU *
let none 6th $6. 00 per acre
------------
2nd none 7th 57 .00 per acre
3rd 8th ;I .00 p -r ac:o
none ---- — -- -- -- - - -
9th $9 . 00 per a�_i .
4th none _. _- _-. ---
5th none ,0th 10. 00 pee ace
—_ -. - --
Acreage changes resulting from surrender or partial assignment rosy rases the
advance minimum royalty proportionately. •
Further, at the end of each five-year peried ,- tesser may change the raL
amount of advance minimum royalty to be paid by Lessee. In the ee nt Ice ee
shall not extract uranium from the leased premises sufficient to return to thm
Lessor the minimum amounts above specified , it is nevertheless under,tocd ehea
the above sums of money are due and payable to Lessor whether or not uranium
is mined, hut that such advance minimum royalty shall be credited upcu Ja first
royalties due as hereinafter provided for uranium actually produced from 'id
prenri es. -
f> Forfeiture of Advance Minimum Royalty. la the absence of prodiction
of uranium in continuous paying quantities before the expiration date of the
lease, all advance minimum royalties and all rentals shall be forfeited to the
Lessor.
7. Ixtension . Lessen may have a preferential right to renew the lease or
to receive a new lease , whichever may be determined by Lessor co be in the hasa
interest of the County, under one or mere of the following conditions:
A. An advance minimum royalty , the amount to be negotiated before
expiration of the lease, will he continuous until the end of the
second ter-year term of the lease, or until the expiration of the
new lease. This amount may he adjusted at the end of each five-
•
year period of the lease.
n. Lessee shall furnish to Lessor satisfactory evidence of pions
for mining during the second Len year term or during the ten-year
term of a new lease or;
C. Iouni h aia•yuate geological evidence to Lessor that the crea.e:'
•
limited is in fact an integral part of and contains reserves in
loitieal t inino unit. Filial e' feriiination as to whct` cr the adrea;
is or is not a part of a locic:rl mining unit will be made by LesE
h. Froductlea e ,ya l ty. Lessor hereby reserves and lessee agrees:
to Le 5or production royalty per the following schedule without regard LI, the
minis r° i ethods Employed by Lessee_ -
300K
810 1712399
RO!'A[ Y 5001 DIII1 L
11
ASSAY PLRCI NiAGI R0YR i Y PI RCI MAGI Dot I AR VAt Ill (1(10111 N !
0. 001 to 0. 075 2. 25% )
0. 0/0 to 0. 15 4. 2)7 ) NULXO LRDA
0. 16 to 0. 20 6. '25 '
0. 21 to 0. 25 8.25% )
0. 26 and higher 10.25;: )
Coluirmn_1 of the schedule, Assay Percentage:
Assay percentages of uranium contained in each ton of ore mined shall to do-
essor reserve the 'r ; Ttermined by Lessee or Lessee' s yualaiied agent. Less
perform its own assay at any time and , in the eve at of disagreement h, tytter
Lessee and Lessor, a disinterested third party may be employed as a rr rco
by mutual agreement to perform a third assay to arbitrate the drsa ree le d .
The cost of the referee shall be paid by the party whose assay shows ter
greatest variance from that of the referee.
Cr,luc,n II of the schedule, Royalty Percent,rpe :
The royalty percentage shown opposite the assay percentage shall he
by the number or pounds or fraction tholtif of uranium ee elned io t
determined by the assay percentage , the product of which shall be r,::ui le .-' [
the followring quotient to compute the royalty due to Red Count/.
Colu,r.n ill of the schedule, Dollar Val c 0rotient :
The quotient is obtained by dividing he two the sum of NUlXO plus LhDx.
quotient shall be re-computed quarterly during the first working weeTer
nary, April , July, and October, unino t.h,e. latest [RDA values and t es values
printed by NUEXCO on the last working day of the previous month.
In the event that published uranium exrlirnse values Sher U become unt.y i
to I r sor from either NUEXCO or I RL A, then exch.. ig ' values puhltsSed elete
entities may be used in theelsched lld rmulasr.�,Selection
1 other en
y ; cr ��sed agreed 'Lo ?rl l g rlr`..
whose published exchange be tween Lessee and Lessor.
NULXO, as used herein, means the uranium Ixchanr _ Value for ismpdi t.l' a lstar
of uranium as published by the Nuclear Lxchange Corporation , 3000 a".
Road, Menlo Park , California 94025; 'Phofie (415) 854-1510 ; TWX. 910-370-176D.
ERDA, as used herein, means the latest long-term-contract quotations
is nilL-
lisi,rd by the Energy Research De'v'elopment Administration, P.O. Box 2567
Grand Junction, Colorado 81501; Phone (303) 242-8621 .
Fractional parts of a ton shall he valued on a pro rata basis to the : ehrest
cent. All weights for purposes of this lease shall be dry weight.
The royalty on any mineral recovered as a by-product shall he payable only Lo
the extent Lessee removes and sells same or is otherwise separately c � , n
sted for same. .
Lessor reserves the right to reasonably adjust the production ro, ulty te
at the end of each ten-year period of the lease , provided the leased rr
THt
are kield by production.
Payment of royhtlies shall he rh)di r - see to lessor wi thin thin t tm) cn
after the end 01 the calen,< rr to ter within which said ore is prose.
r ; ,
processed by or for the benefit of lessee , or removed from the lei.- r e mse
if sold by 1 e ec and shall be accompoared by a
start i ' t showing
rc;..r
analyses and values of all ores , concentrates , minerals , metals and rrrur '
from the lea ea o r ises during such ;erevious calendar y„arte, and
th of the charges or costs deductible therefrom.
-3-
ei°°1C 810 1732399
The mineral content of all ore mined and removed from the leased premises
shall be determined by Lessee, or 6, the mill or smelter to which the ore is
shipped, in accordance with standard sampling and analysis procedures.
Upon request to Lessee, and at Lessor' s expense, Lessor shall have the ri.;`h .
to have a representative present at the time samples are taken.
In the event Lessee mines ore from the leased premises, Lessor shall be fur-
nished, at the Lessor's request and at no expense, a portion of all or any
samples taken for analysis. In that event, split samples shall be retained
by Lessee for later analysis by an independent referee, as provided above.
9. Solution Mining in Situ. Lessee shall determine the depth, size,
shape, volume, tonnage and uranium content of the ore body to be mined. The
ore body shall be accurately located relative to the lands described in this.
lease. Royalty percentage and monies shall be computed on the average am—ant
of uranium per ton of ore in the ore body or bodies that exist on, in, and
under the leased premises by use of the above royalty schedule.
SOLUTION MINING IN SITU means any process by which uranium is removed from an
ore body .by dissolving the uranium from the ore body and removing the uranium
with a liquid substance without removal of or disturbance of the ore body, ex-
cepting that holes may be drilled into the ore body for injection and removal
of the liquid substance, for monitoring the process and for assay purposes.
HEAP LEACHING_ Lessee shall determine volume, tonnage, .and uranium content
of materials in mine dumps from this lease that are to be leached, Royalty
monies shall be computed by use of the above schedule, with the average amni:u1_
of uranium contained per ton of material in the mine dump leach piles. Ores
containing recoverable uranium shall not be commingled with mine dump materials.
The mine dump shall be on the leased premises unless otherwise agreed to io
writing between Lessee and Lessor.
HEAP LEACHING means any process by which uranium is removed from materials iii
mine dumps by dissolving the uranium contained in the mine dump materials .
MINE DUMP means spoil heap of waste rock. refuse or other non-ore materials_
• .10. Overriding. -Royalty Limitations. It is agreed that this lease or ;w,;'
subsequent assignment hereof shall not be burdened with overriding royalties
the aggregate of which exceeds 2 % of the gross value of the uranium
at the first point of sale. Lessor must he notified of all overriding roy-
alties accruing to this lease. Violation of the above will subject this lease
to cancellation by Lessor.
11. Annual Production Reports. In addition to the quarterly statements
from Lessee required by paragraph 7 of this lease, Lessee shall also, annually
during the term of this lease, submit a sworn statement to Lessor disclosieg
the number of tons and the assay thereof of all uranium mined from the premises
during the preceding year. Such annual statements may coincide With Lessee' s
fiscal years or with official calendar years. Further, Lessee shall furnish
a map annually showing all workings, depths, thicknessess or uranium ore with
location of same tied to a corner established by United States survey, cer-
tified by a licensed surveyor. Maps furnished to the Colorado Division of
Mines or to the Mined Land Reclamation Board may satisfy this requirement.
Lessor agrees that all such information supplied by Lessee shall remain con-
.fidential and unpublished for the duration of this lease.
12. Prospecting and Exploration Data. Lessee shall provide to Lessor,
upon request, a complete report on prospecting and exploration operations ,
- including geologic interpretations and recoverable -reserve calculations , aid
maps and cross sections showing location of any uranium bearing outcrops, drill
holes, trenches, uranium ore bodies and other prospecting and exploration
activities, along with assays showing the amount of uranium contained in ;.he
ore. The records required to be maintained by Lessee and provided to Lessc::
upon request include logs of all strata penetrated and all geologic and hydro-
logic conditions encountered, and copies of in-hole surveys. This infor;sr,.t.•it.,r
is to be collected and prepared under the supervision of a qualified geo7 oo mot,
geological engineer or mining engineer. Other qualified persons may collect
and prepare this data, if agreed to in writing between Lessee and Lessor.
any event, upon termination of this .lease, all of the above information shall
be provided by Lessee to Lessor. Lessor agrees that all such information: sop-
plied by Lessee shall remain confidential and unpublished for the duration of
this lease.
‘343 810 t'732399
13. No Dri l l s i to Near Dwell -i:t9 (louse. No dri l l si to shall be located
within 200 feet of any existing well or dwelling house unless the permission
of the surface owner is first had and obtained, and notice of the grant of
such permission is given to Lessor.
14. Limitation of Exploratory Work. No work shall be done by Lessee
during exploratory operationsthat may interfere with lambing or feeding c+
livestock unless the permission of the surface owner is first had and ob-
tained, and notice of grant of such permission is given to Lessor.
15. Livestock-Tight Fences. Lessee agrees to enclose with a livestcck--
tight fence any excavations dangerous to livestock that it may make in the
course of •its operations.
16. Maintenance of Fences. The Lessee agrees not to keep fences do' a
at any point, to repair promptly any road damage done by vehicles ant equip-
. ment of Lessee,.and to erect gates or cattleguards in all fences in which
openings may be made for ore haulage.
17.- Payment for Surface Damage. If any of Lessee's operations here-
. result in damage to buildings, land, personal property, growing crops
or timber, Lessee shall reimburse the owner for the reasonable value. of the
same, and shall hold Lessor harmless from any liability for such damage.
18. Lesser Interest. In the event Lessor owns an interest in the sub-
ject minerals which is less than the entire and undivided mineral estate
• therein , whether or not such lesser mineral interest is referred to herein ,
then the royalties and delay rentals herein provided for shall be paid to
Lessor only in the proportion that Lessor's interest therein bears to the
whole and undivided mineral estate. Lessor shall be entitled to retain only
such proportion of the moneys previously paid to Lessor hereunder as Lessor's
said interest bears to the whole and undivided mineral estate, and Lessee
shall be entitled to offset all other moneys previously paid Lessor hereundee
against royalties and delay rentals which thereafter become due and payab;e
to Lessor hereunder. Notwithstanding any other provisions of this lease, with
respect to that'portion, if any, of the leased premises in which Lessor owns
no right, title, or interest in the subject mineral-s, Lessee is under no
obligation to pay, and Lessor has no right to receive, delay rentals, advance
minimum royalties, or production royalties.
19. Disclaimer of Warranty. Nothing herein shall be construed as a
warranty of title or an agreement to defend title to the Leased Premises by
the Lessor.
20. Exploration and Mining Operations. Lessee agrees to maintain all
operations in a good and workmanlike manner. The Lessee shall use the method
of exploration and reclamation set out in Schedule A of this lease. The
Lessee may use and employ methods of mining as it may desire or find most
profitable and economical so long as the Lessee complies with all applicable
requirements of the County of Weld and the State of Colorado regarding the
protection of ground water resources, the rights of surface owners, and the ee-
clamation of mined lands. Lessee shall have all the right and privilege of the
Lessor at any time during the term of this lease, and so long thereafter as
it may hold an interest in the minerals hereunder, to use any and all roads cr
workings located at any time-on or under the leased premises, and Lessee shall
have the further right of mixing, either underground or at the surface or pro-
cessing plant, any ores, solutions or other .products (herein called "products")
containing subject minerals and produced from the leased premises or any
portion thereof with products from any other lands, provided that the mixiiru is
• accomplished only after the products have been sampled and after the weight or
• volume thereof has been determined or ascertained by sound engineering pt +n-
ciples. An accurate record of the tonnage or volume of products and of he
analysis of products from each property going into such mixture shall be frt
and made available to Lessor at all reasonable times. The tonnage or v ! ui.:e
of products from each property, together with the analysis thereof, shal-:
Le
used as the basis of the allocation between the properties of production
royalties paid .from such products.
21. Pooling. In connection with in situ, leach or solution mining , '.('ssee
is hereby granted the right to pool and combine acreage from the leased n.'e°:,ises
with acreage from ether lands for the purpose of obtaining a drilling pattern
-5-
tJuut• 1O 1932399
set up for such mining at the boundary of said leased premises. In such /
event, Lessee shall have a location of such drilling pattern acurately surveyed
to determine the position of the drilling pattern with respect to the pro-
perty line or lines of the properties involved. The Lessee shall furnish the
Lessors of the leased premises of the other properties involved with a cor;'
of such survey. The allocation of royalties attributable to mineral contain-
ing solutions produced from production well or wells involved in such drill -
• ing pattern shall be allocated to the respective royalty owners pro rata , on
the basis of surface acreage of the leased premises and other lands lying
within such drilling pattern. It shall be conclusively presumed that ti-e ..ab-
ject minerals which are produced are produced in a uniform manner within thc
boundaries of such dr-illing. pattern. In no event shall the drilling patl.ern
used for the purpose of pooling under this paragraph exceed 100 feet on either
side of the boundary line or_ a radius of 100 feet from a point on the bc'jr iary
line if the drilling pattern is irregular.
22. Assignment. . The estate of either party may be assigned in whole or
in part; provided, that no change in the ownership of the leased premises er
assignment of royalties payable hereunder shall be binding upon Lessee until
Lessee has been furnished with a written transfer or assignment or a certif;e
copy thereof; and provided further that Lessee may not assign its estate with-
out written permission of Lessor, which permission will not be unreasonably
withheld. In the event this mining lease shall be assigned as to a part or
parts of the leased premises and the Lessee, or assignee 'or assignees of any
part or parts, shall fail or made default in the payment of the proportior, te
part of royalties due from him or them or otherwise breach any covenants con--
tained herein, such default shall not operate to defeat or affect this lease
insofar as it covers any other part or parts of the leased premises. An as-
signment of this lease shall , to the extent of such assignment, relieve and
discharge the Lessee of all obligations hereunder which have not theretofore
become due.
23. Inspection. Lessor or its duly -appointed representative shall have
the right, exercisable at all reasonable times and in a reasonable manner so
as not- to interfere with the Lessee's operations, to go upon the leased pre-
mises or any part thereof, for the purpose of inspecting the workings thereon.
Lessor is also hereby authorized to check assays and scales a
as to. tor a workings
r
ac,
curacy, to go through any of the slopes, entries, shafts, openings
on said premises, and to examine, inspect, survey and take measurements of toe
same, and to examine and make extracts from, or copies of, all books and .
weight sheets and records which show in any way the uranium output, uranium
values, payments and royalties from and of the leased premises. Lessee shall
• furnish all conveniences necessary for saj4 inspection survey or examination
to Lessor. Lessor may require Lessee to provide all instruments and docu-
ments Of any kind and nature whatever which affect Lessee's interests. Lessor
shall hold Lessee harmless from all claims for damages -arising out of any
death, personal injur"31 or property damage sustained by Lessor or Lessor' s
agents or servants, while in or upon the leased premises herein permitted, un-
less such death or injury arises as a result•of negligence of the Lessee.
• 24. Notices. It is agreed -that any notice required to be given to Lessee
under the provisions of this lease shall be sent by certified mail to the ac'-
dress set forth at the beginning of this lease or to such other
address
lasc •
s
Lessee may indicate -in writing to Lessor, and such service by ail
deemed sufficient and in full• compliance with the terms of this lease. Notice
to Lessor shall be given in like manner, addressed to the Weld County
lBoard
ard of
County Commissioners, -Centennial Center, 915 10th Street, Greeley,
80631.
2.5. Default; Force Majeure;Termination. If at any time Lessee shall be
in default inthe performance o•f the 1.errrs and conditions of this .lease? to
performed by it, provided such default is not caused by casualties, strike,
legislation, public regulations, storms, flood, acts of God, civil or military
disorders, insurrection, riots, fire, accident, explosion, or other causes t:e-
yond the control of Lessee, and if., with 90 days after written notice of such
default is given by Lessor to Lessee, Lessee has not coirnenced activities
which will cure the default if pursued diligently, then Lessor may
erminete
this lease by notice to Lessee provided that, for .any default in the payrnet
of money, Lessor may terminate this lease by notice to Lessee if such default
is not cured within 30 days 'after such written notice of default. If this
lease is surrendered or terminated for any cause, Lessee shall remove all eu-
gines, tools, machinery, buildings, structures, headframes, trailers, ore
•
-6_
810 1732399
stockpiles and all other property of every nature and description erected ,
place or situated on the leased promises by it within a period 'of 90 days
from the effective date of such surrender or termination. Upon such term-
ination, Lessee shall close off and plug any open shafts or holes to such
extent that such shaft of hole shall not thereafter he a hazard to persons
or livestock using the surface of the leased premises, in accordance with
the provisions of Schedule A attached. If upon termination of this lease
for any reason, whether by surrender, forfeiture or expiration of term or
otherwise, Lessee shall not have fully complied with the terms of this
lease, Lessor shall hold and retain possession of the property improvements
and equipment of the Lessee as security unto Lessor, for the payment of
rent and royalties to Lessor, or to protect Lessor against liens , or to
indemnify Lessor against any loss or damage sustained by Lessor by reason
of default. of Lessee , for which purpose Lessor is hereby given a lien upon
all such property improvements and equipment, which lien shall attach as
the same are place upon the premises. In the event Lessor shall foreclose
the lien given to Lessor by Lessee, Lessor may itself be purchaser at any
sale thereof upon such foreclosure. Upon the termination of this lease
for any cause, if Lessee shall remain in possession of said premises , Lessee
shall he guilty of an unlawful detainer under applicable Colorado law,
and shall be subject to all the conditions and provisions thereof and to •
eviction and removal .
26. Surrender. Lessee may at any time execute and deliver to Lessor
a release or releases covering all or any portion or portions of the lets,ei
premises and thereby surrender this lease as to all or such portion or por-
tions and, from and after the date of such release, thereby terminate all
obligations, including a proportionate amount of delay rentals , to the
acreage -surrendered except obligations accrued as of the day of surrender-.
Such release must be in writing and must contain the book and page number
of said lease. All annual and quarterly reports and exploration infor-
mation required by this lease must he submitted to Lessor .before the lease
may be terminated. This clause becomes inoperative upon the institution
of any suit in any court of law by Lessee, Lessor or any assignee of either
to enforce this lease, or any of its terms , express or implied.
•
- 27. Notice to Lessor. Notwithstanding any provision of this lease
to the contrary, no operation shall be commenced upon the leased premises
without written notice to the Lessor and to the surface owner, if other
than the Lessor.
28. GovernmentReequlations. It is expressly understood that this
lease is subject to and controlled by any,law of the State of Colorado now
in effect restricting or limiting the powers of counties of boards of county
commissioners , and any provision herein in conflict therewith shall he in-
operative and void. It is further understood that this lease in no way
operates to relieve Lessee of the obligation -to comply with all applicable
laws , rules, regulations and ordinances of the County of Weld , the State of
Colorado and the United States of America , governing mineral exploration ,
mining operation , and reclamation of mined lands, including land use and
building regulations.
29. Water. If Lessee initiates or establishes any water rights for
which the point of surface diversion or ground water withdrawal is on the
leased premises, title to such water rights shall , upon termination of the
lease, become the property of the surface owner without cost, and title to
water rights shall be conveyed to the surface owner immediately upon term-
ination, except that if Lessor is the surface owner the water right shall
be taken in the name of the Lessor in the firsbinstance and shall be the
property of lessor without cost.
30. binding Effect. This lease shall be binding on the parties P.-hr. -
to, and upon their heirs, successors, assigns, executors or administrators_
31 . Indemnification of Lessor. lessee agrees to hold Lessor haru(ics
for any and all manner of claims arising or to arise from Lessee's opesabre._,
on the said leased premises.
BOOK
81.0 1732399
: I
32. Notwithstanding anything hereinabove contained to the contrary,
in the event that uranium and other associated minerals are recovered from
the leased premises by Lessee through in situ, leach or solution mining,
Lessee shall pay Lessor a royalty which is the greater of the royalty set
forth herein or a royalty for each pound of U308 recovered of 3 1/3% of the
NUEXCO rate for the month in which the U308 is actually recovered from the
leased premises.
IN WITNESS WHEREOF, the parties hereto have set their hands and seals
as of the day and year first above written.
Pdtwgn_ AEk$ eQ2eOK.
LESSEE: LESSOR: BOARD OF COUNTY COMMISSIONERS
[iicer P2rSe'o sr W COUNTY, COLORADO'
i% &(
4irwsr / -/._ ( -�
s w.r =Ur;zrnay
ATTEST: ,
COUNTY CLERK AND RECORDER
AND CLERK TO THE/GARD
BY�� :u . 4i.r(Lci
eputy County C erc
,
'LJ
0
-8-
3cor< 810 1.7323)9
r �+
SCHEDU:_E A
DRILLHOLE ABANDONMENT PROCEDURE
WELD COUNTY MINERAL LEASE
1. Materials. The following materials cr similar materials made by
different manufacturers shall be used in the drillhole abandonment pro-
cedure. Baroid Quick Gel - a high yield bentonite packaged in fifty (50)
pound bags; Baroid Quick Trol - granular nonfermenting organic compound
packaged in two (2) pound moisture proof bags.
2. Mixing. The materials described in No. 1. above shall be mixed
in a ration of 2 pounds of Quick Trol to 100 pounds of Quick Gel . At the
time of reaching the total depth, the proper amount of Quick Gel and Quick
Trol are to be premixed prior to "jetting" into the mixing tank. Mixing
must be doneslowly and thoroughly. "Balls" of unyielded gel floating in
the mixing tank are an indication of insufficient and too rapid mixing.
Approximately one gallon of cementing material per foot of depths is requires:
for a 4 3/4 inch diameter drillhole. lo minimize waste, a portion of the
mixing tank of sufficient volume to fill the drillhole should be blocked
off and the mixing operation confined to that portion.
•
•
A Marsh Funnel and a graduated one-quart capacity cup shall be used for
testing the viscosity of the drilling mud according to the following pro-
cedure:
A. Pour sample of mud through a screen into the funnel (close exit
hole with finger) . "Lumpy" (unyielded) gel shall be screened out
and should be discarded.
• B. When the funnel is nearly full , release finger from exit hole and
determine length of time necessary to fill the cup to one-quart cap-
acity. Not less than 53 seconds should be required to fill the cup.
Any lesser viscosity is unacceptable.
•
3. injection. After determining that the mud meets specifications,
the mud shall be pumped into the drillhole displacing the fluid already
in the hole. The drill pipe may now be removed from the hole and any un-
injected mixture remains should be used to fill the hole to the surface
after the pipe is withdrawn.
4. Plugging. After injection of mud, a substantial surface plug shall
be placed in the drillhole according to the following procedure:
A. An octoplug or other substantial expandable plug shall be placed
in the drillhole to a depth of 10 feet.
B. Approximately one foot of drill cuttings shall be shoveled into
the drillhole to act as a sealant for the cement.
C. At least 1/3 of a bag of cement shall be emptied onto the wet,
sandy portion of the drill cutting pile. If the hole is out of grAme,
such as in a surface gravel , then more cement-sand mixture must be
placed in the hole. If necessary, several sacks of cement shall be
used to plug one hole.
D. The cement and sand shall be thoroughly mixed with a shovel until
.all cement has been taken out by the wet sand.
•
E. The sand and cement mixture shall be shoveled into the drillhole.
E. The mixture shall be 'lightly tamped in the hole to insure against
the formation of air pockets.
G. The above procedure shall be repeated until the drillhole is filled
to within two feet below ground level .•
U. Drill cuttings shall be shoveled into the hole until it is filled
to slightly above ground level alowing fur some compaction.
5. Reclamation. The surface around each drillhole shall be reclaimed
by the following procedure: Dried cutting piles shall be reduced to a veer:
less than 1/2 inch thick with a backhoe with a bucket attachment, in order to
allow the underlying grass to reclaim the surface around. the drillhole.
•
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