Section 050. Land Use, Surface Rights And Obligations

01. Prevention of Injury or Damage. The Lessee, its assignees, agents, and/or contractors must tak e all reasonable precautions to prevent injury or damage to persons, real and personal property, and to prevent waste or damage to the oil, gas, and other surface and subsurface natural resources and the surrounding environment includin g vegetation, livestock, fish and wildlife and their natural habitat, streams, rivers, lakes, timber, and forest an d agricultural resources. The Lessee, its assignees, agents, and/or contractors will compensate the Board, its surfac e lessees, grantees, or contract purchasers for any damage resulting from their operations or any damage resulting fro m their failure to take all reasonable precautions to prevent injury or damage to persons, real and personal property, an d to prevent waste or damage to the oil, gas, and other surface and subsurface natural resources and surroundin g environment, as set forth above. The Lessee, its assignees, agents, and/or contractors must comply with all environmental laws, rules, and regulations as they pertain to its operation. (7-1-25) 02. Blowout or Spill. The Lessee must report to the Director any blowout, fire, uncontrolled venting , or oil spill on the leased land within twenty-four (24) hours and confirm this report in writing within ten (10) days. (7-1-25) 03. Timber Removal. The Lessee may not unreasonably interfere with the removal of timbe r purchased prior or subsequent to the issuance of an Oil and Gas Lease. The Lessee may remove any timber required for ingress or egress or as otherwise necessary for operations. The Lessee must pay the current stumpage price, a s determined by the Director for any timber cut or removed. Such proceeds go to the state agency that has custody and control over the leased lands. (7-1-25) 04. Potable Water Discovery

ior or subsequent to the issuance of an Oil and Gas Lease. The Lessee may remove any timber required for ingress or egress or as otherwise necessary for operations. The Lessee must pay the current stumpage price, a s determined by the Director for any timber cut or removed. Such proceeds go to the state agency that has custody and control over the leased lands. (7-1-25) 04. Potable Water Discovery. If the Lessee finds only potable water in any well drilled fo r Exploration or production of oil and gas, and the water is of such quality and quantity as to be valuable and usable fo r agricultural, domestic, or other purposes, the Board may acquire the well with whatever casing is installed in the wel l at the casing’s fair market value upon the surface lessee, grantee, or contract purchaser assuming all future liabilitie s and responsibilities for the well, with the approval of the Commission, and if such acquisition is in compliance wit h Section 058; provided that the surface lessee, grantee, or contract purchaser also complies with applicable laws and rules of the Department of Water Resources. (7-1-25) 05. Reclamation. The Lessee must reclaim all State Lands disturbed by its Exploration and operation s so that they are, at least, consistent with previous use by the surface owner. This may include segregating an d protecting topsoil and regrading to approximate previous contour. If the Director has determined that substantia l removal of topsoil has occurred, the Lessee will replace the topsoil and revegetate to the extent necessary to minimize erosion. (7-1-25) 06. Entry by Director. The Director is permitted, at all reasonable times, to go in and upon the lease d lands and premises to inspect the operations and products obtained and to post any lawful notice. The Director may, a t any time, require that reasonable tests, surveys, samples, etc., be taken to assure compliance with these rules, i n accord with their instruction, without cost to the state of Idaho, to assure compliance with these rules

ed, at all reasonable times, to go in and upon the lease d lands and premises to inspect the operations and products obtained and to post any lawful notice. The Director may, a t any time, require that reasonable tests, surveys, samples, etc., be taken to assure compliance with these rules, i n accord with their instruction, without cost to the state of Idaho, to assure compliance with these rules. The Director may at any reasonable time and at state expense, inspect and copy all of Lessee’s books and records pertaining to a Lease under these rules. If the Lessee fails to take timely, corrective measures, as ordered by the Director, Board, o r Commission, bond forfeiture may occur and the Director may: shut down Lessee’s operations if the Director determines they are unsafe or are causing or may cause waste or pollution to oil, gas, or other resources, or; or th e Director may terminate the Lease and cause damage or unsafe conditions to be repaired or corrected, at the expens e of the Lessee. (7-1-25) 051. -- 054. (RESERVED)