Montana Code Annotated 2023

TITLE 77. STATE LANDS

CHAPTER 3. ROCK, MINERAL, COAL, OIL, AND GAS RESOURCES

Part 3. Coal

Rental And Royalty Terms

77-3-316. Rental and royalty terms. (1) The compensation of the state under all coal mining leases must be upon a rental and royalty basis and must be fixed and determined by the board.

(2) The rental and royalty terms of each lease must be subject to readjustment to reflect fair market value at the end of its primary term of 10 years and at the end of each 5-year period thereafter if the lease is producing coal in commercial quantities.

(3) The rental may be on a per-acre basis or per-ton basis but the rental may not be less than $2 per acre.

(4) (a) The amount of the royalty must be based upon:

(i) the kind, grade, and character of the coal in each particular mine;

(ii) the size, shape, and nature of the coal vein, strata, or body; and

(iii) the shipping and marketing facilities for the product.

(b) Consideration must also be given to every other known factor affecting the value of each particular coal mining lease, but the royalty for the coal mined may not be less than 10% of the f.o.b. mine price of a ton prepared for shipment.

History: (1), (3), (4)En. Sec. 40, Ch. 60, L. 1927; re-en. Sec. 1805.40, R.C.M. 1935; amd. Sec. 3, Ch. 358, L. 1975; Sec. 81-503, R.C.M. 1947; (2)En. Sec. 39, Ch. 60, L. 1927; re-en. Sec. 1805.39, R.C.M. 1935; amd. Sec. 5, Ch. 257, L. 1965; amd. Sec. 1, Ch. 121, L. 1967; amd. Sec. 6, Ch. 22, L. 1971; amd. Sec. 1, Ch. 291, L. 1971; amd. Sec. 31, Ch. 428, L. 1973; amd. Sec. 2, Ch. 358, L. 1975; Sec. 81-502, R.C.M. 1947; R.C.M. 1947, 81-502(part), 81-503; amd. Sec. 5, Ch. 332, L. 2011.