30 U.S.C. § 642 — Exploration contracts
submitted 68 years ago by Pub. L. 85-701 to r/title-30-MINERAL-LANDS-AND-MINING · 527 words · no verdicts yet
The Secretary may enter exploration contracts, and those contracts must provide Federal financial participation that the Secretary considers in the national interest, subject to specified repayment, royalty, and interest terms.
(a) Terms and conditions; interest rates. To carry out this chapter, and subject to this section, the Secretary may enter exploration* contracts with individuals, partnerships, corporations, or other legal entities. The contracts must provide whatever Federal financial participation the Secretary considers in the national interest. They must contain terms and conditions the Secretary considers necessary and appropriate, including repayment of Federal funds made available under the contract, with interest, as a royalty based on production value from the contract area. Interest is calculated from the loan date. The interest rate must be at least: (1) the rate the Treasury Secretary determines the Interior Department would have to pay to borrow the funds from the United States Treasury, considering current average yields on outstanding marketable United States obligations with maturities comparable to the contract terms; plus (2) 2 percentage points per year instead of separately recovering the cost of administering the contract.
(b) Deposit of royalty payments. The Treasury must deposit royalty payments received under subsection (a) as miscellaneous receipts.
(c) Certification of exploration projects; payment of royalties; time limitation on payment; royalty agreements. If the Secretary believes that analysis and evaluation of an exploration project's results show mineral production from the contract area may be possible, the Secretary must certify that within the contract's specified time. After certification, royalty payments are a charge against production for the full contract period or until the obligation is paid, but they may not continue for more than 25 years after the contract date. If the Secretary decides not to certify, the Secretary must promptly notify the contractor. When necessary and in the public interest, the Secretary may enter royalty agreements requiring royalty payments in the same way as if the project had been certified.
(d) Production. Nothing in this chapter, or in a rule or regulation the Secretary issues, may be read to require production from the contract area.
(e) Rules and regulations; adjustment of contracts. The Secretary must establish and issue rules and regulations needed to carry out this chapter. The Secretary may modify or adjust a contract's terms to reduce the amount or duration of royalty payments when the Secretary decides that doing so is necessary and in the public interest. No single contract may authorize more than $250,000 of Government participation.
(f) Availability of funds. No funds may be made available under this chapter unless the applicant provides evidence that commercial sources cannot provide funds on reasonable terms.
In order to carry out the purposes of this chapter, and subject to the provisions of this section, the Secretary is authorized to enter into exploration* contracts with individuals, partnerships, corporations, or other legal entities which shall provide for such Federal financial participation as he deems in the national interest. Such contracts shall contain terms and conditions as the Secretary deems necessary and appropriate, including terms and conditions for the repayment of the Federal funds made available under any contract together with interest thereon, as a royalty on the value of the production from the area described in the contract. Interest shall be calculated from the date of the loan. Such interest shall be at rates which (1) are not less than the rates of interest which the Secretary of the Treasury shall determine the Department of the Interior would have to pay if it borrowed such funds from the Treasury of the United States, taking into consideration current average yields on outstanding marketable obligations of the United States with maturities comparable to the terms of the particular contracts involved and (2) plus 2 per centum per annum in lieu of recovering the cost of administering the particular contracts.
Royalty payments received under paragraph (a) of this section shall be covered into the miscellaneous receipts of the Treasury.
When in the opinion of the Secretary an analysis and evaluation of the results of the exploration project disclose that mineral production from the area covered by the contract may be possible he shall so certify within the time specified in the contract. Upon certification, payment of royalties shall be a charge against production for the full period specified in the contract or until the obligation has been discharged, but in no event shall such royalty payments continue for a period of more than twenty-five years from the date of contract. When the Secretary determines not to certify he shall promptly notify the contractor. When the Secretary deems it necessary and in the public interest, he may enter into royalty agreements to provide for royalty payments in the same manner as though the project had been certified.
No provision of this chapter, nor any rule or regulation which may be issued by the Secretary shall be construed to require any production from the area described in the contract.
The Secretary shall establish and promulgate such rules and regulations as may be necessary to carry out the purposes of this chapter: Provided, however, That he may modify and adjust the terms and conditions of any contract to reduce the amount and term of any royalty payment when he shall determine that such action is necessary and in the public interest: Provided further, That no such single contract shall authorize Government participation in excess of $250,000.
No funds shall be made available under this chapter unless the applicant shall furnish evidence that funds from commercial sources are unavailable on reasonable terms.
Source credit: (Pub. L. 85–701, § 2, Aug. 21, 1958, 72 Stat. 700.)
- 1958Enacted · Pub. L. 85-701 · 72 Stat. 700
A history note hasn’t been published yet. The record shows enactment by Pub. L. 85-701 on 1958-08-21.
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