27-551. Definitions In this article, unless the context otherwise requires: 1. " Arizona refinery business" means a firm which markets in this state the product refined from royalty oil purchased under this article and which either owns and controls an oil refinery located within this state or is an Arizona corporation which owns an oil […]
27-552. Rules and regulations The department may prescribe rules and regulations necessary and appropriate to carry out the purposes of this article.
27-553. Leasing state lands for oil and gas The department may lease state lands for oil and gas and issue oil and gas leases as provided in this article.
27-554. Designation of known geological structures of producing oil and gas fields A. The department shall from time to time determine and designate the known geological structures of producing oil and gas fields. The determinations and designations shall be published twice in a newspaper of general circulation in the state, the last publication to be […]
27-555. Lease of state lands not located within known geological structure of producing oil and gas field; application; lease extension; provisions of lease; withdrawal of lands from leasing A. When state lands are not located within any known geological structure of a producing oil and gas field, as determined pursuant to section 27-554, the person […]
27-555.01. Extension of lease due to lack of transportation, processing facilities or market A. When the owner of an oil and gas lease issued pursuant to this chapter has discovered oil or gas on the leased premises or on lands joined therewith in a cooperative or pooled unit, while the lease is in full force […]
27-556. Lease of state lands located within known geological structure of producing oil or gas field; sealed bids; call for bids; publication; lease extension; provisions of lease; acreage limitation When state lands are located within a known geological structure of a producing oil or gas field, as determined pursuant to section 27-554, the lands shall […]
27-557. Unit operations; unit agreements A. Each lease issued under the provisions of this article shall provide that the lessee, insofar as its interest in the lease is affected, may join in cooperative or unit plans for the exploration, development and operation of oil and gas pools with the United States, its agencies and its […]
27-558. Conservation laws The development of oil and gas leases issued pursuant to this article shall be in accordance with the laws of the state relating to the conservation of oil and gas.
27-559. Development of water for use in operations; taking over well which yields fresh water A. A lessee shall have the right to develop water for use in its operations subject to the applicable laws of the state pertaining to drilling water wells and using water produced therefrom. B. If any well drilled for oil […]
27-560. Surface use by lessee; liability for damages; bond; appraisal of damages; appeal The lessee shall have the right to use as much of the surface of the lands as reasonably necessary for its operations under the lease. The lessee shall be liable for damage caused by it to the state’s interest in the surface […]
27-561. Assignment of lease; recording A. In event of the assignment of a lease as to a segregated portion of the land covered thereby, the rentals payable thereunder shall be apportionable between the several leasehold owners ratably according to the surface area of each. Default in rental payment by one shall not affect the rights […]
27-562. Surrender A lessee may surrender any part or all of the lands covered by the lease at any time upon payment to the department of all amounts then due as to the lands surrendered, but no refund of any part of the cash consideration or rental theretofore paid shall be made to the lessee […]
27-563. Payment of noncompetitive lease royalties in kind or cash Royalties payable to this state under section 27-555, subsection B are payable in kind or in cash at the option and demand of the department. The lessee shall pay royalties in cash unless the department elects to receive royalty oil in kind pursuant to this […]
27-564. Receipt and sale of royalty oil A. The department on its initiative and with the approval of the selection board may elect to receive royalty oil in kind from a lessee in lieu of a cash royalty, and the department may resell such royalty oil in the manner provided by the selection board. B. […]
27-565. Application to purchase royalty oil A. An Arizona refinery business may apply to the department to purchase royalty oil which the department elects to receive from a lessee. The application shall be filed not more than fifteen weeks nor less than thirteen weeks before the date of sale of the royalty oil by the […]
27-566. Notice to lessee of election; storage A. Not less than eleven weeks before the sale of royalty oil by the department, the department shall give the lessee written notice of the department’s election to receive the quantity of royalty oil on the date specified by the department. B. If the notice of election is […]
27-567. Sales of royalty oil A. The royalty oil which the department receives pursuant to an election under section 27-564 shall be offered for sale by the department at 10:00 a.m. on the date of delivery of the royalty oil to the department. B. The application fee and procedure for sale shall be as prescribed […]
27-568. Delivery of oil to purchaser Royalty oil sold pursuant to section 27-567 shall be delivered to the buyer at the earliest time following the declaration of the highest and best bidder and payment to the department.
27-569. Prohibitions on resale Sale of royalty oil under this article is for processing or use in the purchaser’s refineries but not for resale in kind. Agreements providing for the exchange of refinery charge stocks on a volume or equivalent value basis are not a resale in kind prohibited by this section. If an exchange […]
