Mineral Disposal on Former Santa Fe Pacific Railroad Company Lands Acquired by the United States

Part 2920:  If the operator owns the minerals, but is not operating under any Federal surface use authorization, the district or field office should establish a trespass case file and issue a trespass notice alleging violation of the appropriate law(s) and regulations.  Upon receipt of the operator’s response, the district or field office must decide whether to let the operator continue operations or demand that the operator cease operations pending decision on the 2920 permit.  The operator must apply for a permit pursuant to 43 CFR Part 2920.  The BLM must calculate trespass damages for the entire amount of time the operation has occurred at the site.  A satisfactory trespass settlement must be negotiated and agreed upon by the operator and the BLM before permit issuance.  Trespass funds received will be deposited into a BLM 5320 LAND account.  In addition, a reclamation bond is required and must be calculated.  Processing the 2920 permit must not proceed until cost recovery fees are estimated and collected.

Part 3600:  If the BLM owns the minerals, but the operator is mining without a Federal contract, the district or field office should establish a trespass case file and issue a trespass notice alleging violation of the appropriate law(s) and regulations.  Upon receipt of the operator’s response, the district or field office must decide whether to let the operator continue operations or demand that the operator cease operations pending decision on the 3600 sale.  The operator must apply for a sale pursuant to 43 CFR Part 3600.  The BLM must calculate trespass damages for the entire amount of material removed from the site.  A satisfactory trespass settlement must be negotiated and agreed upon by the operator and the BLM before contract issuance.  Trespass funds received will be deposited into a BLM 5320 MINL account.  In addition, a reclamation bond is required and must be calculated.  Processing the 3600 sale must not proceed until cost recovery fees are estimated and collected.

Escrow:  In the event that the BLM asserts mineral ownership of the mineral materials and the operator disagrees, the BLM can allow the operation to continue (Handbook 9235-1, Chap. II. A. 3.b.), but should issue a surface use permit with the condition that this permit is temporary until a determination is made about the mineral material ownership.  This permit will require NEPA analysis, bonding, and cost recovery fees.  Operations will be allowed to continue under an approved Plan of Operations until the BLM completes its mineral ownership determination.  Pursuant to an escrow agreement, the operator must make regular payments for the value of the materials removed from the trespass site.  Federal royalty payments must reflect fair market value for the mineral material, which is determined by appraisal.  The funds in the escrow account will not be disbursed to the operator or the U.S. Treasury until a final determination of ownership of the mineral materials is made.  If a mineral material contract is required as a result of the mineral ownership determination, the royalty payment specified in the escrow agreement will be adjusted to reflect the actual appraised value of the mineral material at the time the contract is issued.