§143. Transfer of solid mineral leases, approval by board

A. In addition to the provisions of R.S. 30:128, in the case of a proposed transfer, under the circumstances described in Subsection B hereof, of any lease or sublease entered into by or under the authority of or subject to the jurisdiction of the State Mineral and Energy Board which includes the development and production of solid minerals, the board shall determine whether to approve such proposed transfer pursuant to this Section and to such rules and regulations as may be issued hereunder.

B. The procedures set forth in this Section shall be followed only where the lease or sublease proposed to be transferred is either (i) one solely for the development and production of solid minerals or (ii) one under which solid minerals have been developed or produced at any time during the three years next preceding the proposed transfer. The procedures set forth in this Section shall be followed irrespective of the form of the proposed transfer, and shall be followed if the transfer is proposed to be effected by way of sale, assignment, or sublease or by the acquisition, directly or indirectly, whether by merger or otherwise, of the beneficial ownership of any class of equity securities of a corporate entity which is either (i) the lessee or sublessee of a lease solely for the development and production of solid minerals or (ii) the entity which has as its principal business the development and production of solid minerals, provided, however, that a transfer for purposes of this Section shall not be deemed to occur (i) by the giving of a mortgage or other security interest in a lease or sublease or (ii) by the acquisition of less than ten percent of any class of equity securities of a corporate entity or (iii) when the proposed transfer covers only minerals other than solid minerals.

C. When a transfer is proposed under the circumstances described in Subsection B hereof, the proposed transferee shall first make application on forms to be prescribed by the secretary of the Department of Natural Resources pursuant to regulation. Such regulations shall require at a minimum, detailed information concerning the competence and integrity of the proposed transferee, including its financial and performance capabilities, as these bear upon its ability to perform all obligations under the lease or sublease in such a manner as not to adversely affect the public interest of the state as respects its natural resources, including potential economic and physical waste and development of such resources, or both. All applications shall be accompanied by a fee of one hundred dollars and a bond to secure payment by the applicant of the actual costs of any investigation or hearing hereunder.

D.(1) Prior to any action by the board on any such application, the secretary of the Department of Natural Resources shall conduct a hearing on the application, which shall be conducted as expeditiously as practicable consistent with developing a full factual record. The seller, assignor, or sublessor of the lease or sublease or the corporate entity whose stock the transferee proposes to acquire under the circumstances described in Subsection B hereof shall be a necessary party to any hearing hereunder, and to any investigation or other proceedings had in connection therewith.

(2) In advance of any such hearing, the secretary of the Department of Natural Resources shall have the same powers as are conferred upon the commissioner of conservation by R.S. 30:909 to investigate, receive written statements, administer oaths and affirmations, subpoena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, contracts, agreements, or other records or documents; and any party to any such hearing shall have the right to take the testimony of any witness and to compel any witness to appear and depose and to produce books, papers, correspondence, memoranda, contracts and agreements, or other records or documents, on the same terms as are contained in R.S. 30:909.

(3) Except as otherwise provided herein, the hearing required hereby shall be conducted in accordance with and pursuant to the provisions of Chapter 13 of Title 49 of the Louisiana Revised Statutes of 1950 and such regulations as the secretary of the Department of Resources may issue hereunder.

(4) Promptly after the conclusion of the hearing, the secretary of the Department of Natural Resources shall prepare written findings of fact and a recommended decision on the application. He shall transmit these to the State Mineral and Energy Board together with a certified copy of the hearing record. After giving due consideration to whether the evidence establishes that the proposed transferee is competent and otherwise qualified to perform all of the obligations under the lease or sublease in such a manner as not to adversely affect the public interest of the state as respects its natural resources, the State Mineral and Energy Board shall issue a written decision granting or denying the application in whole or in part or upon such conditions as it may deem appropriate.

(5) An appeal may be taken from any final order of the State Mineral and Energy Board under this Section only by a party to the hearing required herein in accordance with R.S. 49:964 and 965.

(6) Anything herein to the contrary notwithstanding, the secretary of the Department of Natural Resources may transmit a recommended decision to the State Mineral and Energy Board without first conducting an investigation or holding a hearing if (i) all necessary parties to the hearing file affidavits with the secretary of the Department of Natural Resources attesting their belief that there are no substantial issues requiring an investigation or hearing and (ii) the secretary independently determines that there are no substantial issues requiring an investigation or hearing.

E. The secretary of the Department of Natural Resources shall have authority to issue all necessary or appropriate regulations to implement this Section.

F. Whenever it appears to the State Mineral and Energy Board or the secretary of the Department of Natural Resources that any person has engaged or is about to engage in any act or practice constituting a violation of any provision of this Section, the secretary of Department of Natural Resources may investigate and issue orders and notices. In addition to all other remedies, the State Mineral and Energy Board or the secretary of the Department of Natural Resources may bring an action in any court of competent jurisdiction in the name and on behalf of this state against any person or persons participating in or about to participate in a violation of this Section, to enforce compliance with this Section, or enjoin any action in violation of this Section.

G. No transfer in violation of any provision of this Section shall be valid.

H. Any person who wilfully violates this Section or who wilfully makes any false statement in an application, investigation or hearing conducted hereunder, may be imprisoned for a period not to exceed one year, or fined an amount not to exceed five thousand dollars, or both.

Added by Acts 1979, No. 296, §1, eff. July 10, 1979; Acts 2009, No. 196, §2, eff. July 1, 2009.