Potash Exploration Permit Regulation

Potash Exploration Permit Regulation, M.R. 432/87 R The Mines and Minerals Act , C.C.S.M. c. M162 Regulation 432/87 R Registered December 1, 1987 bilingual version (HTML) Definitions 1 In this regulation, "cash deposit" in addition to its usual meaning includes an approved (a) certificate of deposit or irrevocable letter of credit issued by any chartered bank in Canada or credit union in Manitoba, or (b) security issued by the Government of Canada, the Province of Manitoba, the government of any other province in Canada or the payment of which is guaranteed by the aforementioned issuers; (« dépôt au comptant ») "C.P.I." means the consumer Price Index for all items for Canada as determined by Statistics Canada, or such other agency whose function it is to determine that index; (« IPC ») "director" means the Director of Mines; (« directeur ») "holder" means the grantee from the Crown of an exploration permit; (« titulaire ») "potash" means all the naturally occurring salts of the element potassium found in association with sodium chloride and in particular sylvite and carnallite. (« potasse ») Exploration permit 2 The minister may issue an exploration permit for potash in the form of Schedule A hereto or in such other form as may be determined from time to time by the minister and may include such terms and conditions as the minister may prescribe. Application for lease 3(1) A holder of an exploration permit for potash who has complied with the terms and conditions of an exploration permit issued under section 2 may apply to the minister to enter into a lease of potash rights in respect of all or any part of an area described in the exploration permit. 3(2) A lease approved by the minister (a) shall provide for (i) payment in advance of an annual rental per hectare calculated in accordance with subsection (3), and (ii) a right of cancellation by the government if the lessee fails within five years to furnish to the minister an independent feasibility study as to whether or not the production of potash from the leased lands is economically viable; and (b) may contain such other terms and conditions as the minister determine. 3(3) The lessee shall pay to the government of Manitoba rental per hectare in accordance with the following: (a) where the lease begins in 1987, the sum of $5. for the first year; and (b) for each subsequent year of the lease, the sum obtained when $5. is multiplied by a fraction the numerator of which is the C.P.I. for December 31 of the preceding year and the denominator of which is in all cases the C.P.I. for the year ending on December 31, 1986. Production subject to royalty 4 The products of any lease acquired pursuant to section 3 shall be subject to the payment to the Crown of such royalty thereon as may from time to time be fixed by the Lieutenant Governor in Council and the royalty shall be collected in such manner as may be specified by the minister. SCHEDULE A POTASH EXPLORATION PERMIT NO. ___ In consideration of and subject to the provisos, conditions and restrictions hereinafter contained, permission is hereby granted to: _________________________________________________________ _________________________________________________________ (hereinafter called "the holder") its successors and assigns the right, licence, privilege and authority insofar as the Crown in the Right of Manitoba has the right to grant the same to explore for potash in, upon or under the lands more particularly described as follows: _________________________________________________________ _________________________________________________________ (hereinafter called the "permit area") containing _____ acres, more or less, for a period of five years dated from the ____ day of ________, 19___, excepting the right to remove or produce any potash save for testing purposes, and subject to the following conditions: 1. The payment of a fee of $250. 2. The payment annually, in advance of the anniversary date of the exploration permit, of a rental of 50¢ for each acre or fraction thereof contained in the permit area. 3. The payment of a cash deposit of $100,000. which shall be refunded to the holder upon termination of the exploration permit provided that the annual expenditure required by clause 4 for the 12 month period in which termination occurs has been fulfilled. 4. The expenditure by the holder of an annual expenditure of $200,000. for the purpose of exploring the potash zone including the drilling of wells in the permit area which wells shall pass through the potash zone. 5. The potash zone penetrated by wells drilled pursuant to this exploration permit shall be cored, and at least one half of the core cut lengthwise shall be forwarded to the director at Winnipeg, together with all chemical and mineralogical analyses of the core. 6. All operations in connection with drilling a well for the purpose of exploring for subsurface minerals shall be carried out in accordance with the provisions of The Mines and Minerals Act and Regulations thereunder as amended from time to time. 7. The data obtained from the cored sections of the potash zone shall not be released by the department prior to the termination of the exploration permit, without the consent of the holder, or until the holder has released such data. 8. The director or any person authorized by him, or both, may enter upon the permit area at any time, with the right of access to all wells, records, plants and equipment situated thereon, together with the right to take samples and particulars, or carry out any test. 9. The holder, his representative and the operator shall render to the director and to any authorized person such assistance as he may require for the purpose of clause 8. 10. Upon receipt of evidence satisfactory to the director that the holder has expended in excess of the amount required by clause 4, such excess expenditure may be applied in respect to the expenditures required in any subsequent year. 11. Where the annual expenditures on the exploration permit are less than that required by clause 4, the holder may, in order to maintain his exploration permit in good standing (a) make a cash payment to the department equal to the amount of deficiency; or (b) make a cash deposit equal to the amount of deficiency and such deposit shall be refundedupon proof being submitted by the holder showing that he has expended during any subsequent year of the exploration permit an amount equivalent to that required by clause 4 up to and including such subsequent year; and, if the holder has not expended the amount equivalent to such requirement, the department may refund a portion of the cash deposit equivalent to the amount of the actual expenditures, if any, made during such subsequent year in excess of the amount required by clause 4 for such subsequent year; and the balance of the deposit shall become the property of the Crown. 12. The holder of an exploration permit shall, not later than 90 days after each anniversary date of the date of issue of the exploration permit, submit to the director a detailed statement of expenditures made in accordance with clause 4, together with a report of all work carried out in the permit area, including a description of all potentially useful substances encountered during such work. 13. The holder of an exploration permit in good standing may obtain an extension of the exploration permit for a further period of one year, from year to year, to a maximum of three years, upon submission of evidence satisfactory to the minister that a reasonable endeavour has been made by the holder to explore and develop the potash zone in the permit area, and provided that application for the extension is made by the holder in writing on or before the expiry date of the exploration permit and the application is accompanied by a fee of $250. 14. Notwithstanding clause 2, the annual rental payable for any extension period granted under clause 13 shall be $1. per acre payable in advance of the anniversary date of the date of issue of the exploration permit. 15. Subject to clause 14 where an extension of an exploration permit has been granted pursuant to clause 13, the terms and conditions governing the initial period of the exploration permit shall apply, with such modifications as the circumstances require, to the extension period. 16. A holder may at any time surrender the lands or any portion thereof in the area of the exploration permit by filing written notice thereof but no rent or fee paid by him with respect to the surrendered lands shall be refunded to him. 17. No assignment of the exploration permit or the rights granted thereunder shall be effective or valid without the consent of the minister being first had and obtained. 18. The holder shall keep the Crown indemnified against all actions, claims, and demands that may be brought or made against the Crown by reason of anything done by the holder, its servants, workers or agents, in the exercise or purported exercises of the rights, powers and privileges hereby granted. 19. This exploration permit does not grant the holder right-of-entry to the surface of the lands described herein. M.R. 115/2025