Page:United States Statutes at Large Volume 102 Part 2.djvu/763

 PUBLIC LAW 100-443—SEPT. 22, 1988

102 STAT. 1767

"(A) the payment in lieu of commercial quantities production requirement of subsection (i). "(B) The significant expenditure requirement of subsection 0)"(2) A lease extended pursuant to paragraph (1) shall continue so long thereafter as geothermal steam is produced or utilized in commercial quantities, but such continuation shall not exceed an additional 25 years, for a total of 50 years, if such lease was also the subject of an extension under subsection (c) or an additional 30 years, for a total of 50 years, if such lease is only extended pursuant to paragraph (1). "(3) If, at the end of either 50-year term referred to in paragraph (2), geothermal steam is being produced or utilized in commercial quantities and the lands are not needed for other purposes, the lessee shall have a preferential right to a renewal of such leeise for a second term in accordance with such terms and conditions as the Secretary deems appropriate. For purposes of this paragraph only, the term 'produced or utilized in commercial quantities' means a bona fide sale or the use of geothermal steam by the lessee to generate electricity in marketable quantities. "(h) To meet the bona fid^ effort requirement referred to in Reports. subsection (g)(1) the lessee must submit a report to the Secretary demonstrating bona fide efforts (as determined by the Secretary) to produce or utilize geothermal steam in commercial quantities for such lease, given the then current economic conditions. "(i)(l) To meet the payments in lieu of commercial quantities production requirement referred to in subsection (g)(1)(A) the lessee must agree to the modification of the terms and conditions of the lease to require annual payments to the Secretary in accordance with this subsection. "(2) Payments under this subsection shall commence with the first year of the extension. Payments shall be equal to the following: "(A) In each of the first through the fifth payment years, at least $3.00 per acre or fraction thereof, of lands under lease. "(B) In each pf the sixth through the tenth payment years, at least $6.00 per acre or fraction thereof, of lands under lease. "(3) Failure to make the payments required by this subsection shall subject the lease to cancellation. "(4) No payments made pursuant to this subsection shall be required after the earlier of the following: "(A) The date of termination of the lease. "(B) The date of relinquishment of the lease. "(C) The date geothermal steam is produced or utilized in commercial quantities from the lease. "(5) No payments made pursuant to this subsection shall be used to reduce rentals or future production royalties. "(j)(l) To meet the significant expenditure requirement referred to in subsection (g)(1)(B) the lessee must demonstrate to the Secretary on an annual basis during an extension that a significant expenditure of funds is being made on the lease. "(2) The following expenditures made by the lessee shall qualify as meeting the requirement of this subsection: ' (A) Expenditures to conduct actual drilling operations on the lease, such as for exploratory or development wells, or geochemical or geophysical surveys for exploratory or development wells. "(B) Expenditures for road or generating facilities construction on the lease.

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