A. For the purpose of issuing oil and gas leases thereon, all state lands under the jurisdiction of the commissioner shall be classified as either nonrestricted or restricted. Those lands placed within a restricted district pursuant to Section 19-10-16 NMSA 1978 shall be classified as restricted lands. All other lands owned by the state under the jurisdiction of the commissioner shall be classified as nonrestricted lands. Before leasing any tract of restricted land, it shall be further categorized as either regular or premium based upon the following factors relating to the tract:

(1) oil and gas trends;

(2) oil and gas traps;

(3) reservoir volume and recovery rating;

(4) lease bonus rating; and

(5) exploration and activity.

A percentage of zero percent to twenty percent shall be allocated to each factor. If the total percentages of all factors for a tract of land to be leased is less than seventy-five percent, the tract shall be categorized as regular. If the total percentage of all factors for a tract of land to be leased is seventy-five percent or more, the tract shall be categorized as premium.

B. After notice and hearing, the commissioner shall promulgate regulations specifying criteria to be used in categorizing tracts pursuant to Subsection A of this section.

History: 1978 Comp., § 19-10-3, enacted by Laws 1985, ch. 195, § 1.

Repeals and reenactments. — Laws 1985, ch. 195, § 1, repealed former 19-10-3 NMSA 1978, as amended by Laws 1972, ch. 70, § 1, relating to the term and form of an oil and gas lease, and enacted a new section. For present comparable provisions, see 19-10-4.1, 19-10-4.2 and 19-10-4.3 NMSA 1978.