CHAPTER 5. Oil and Gas and Mineral Leases by Public Agencies [7051. - 7062.]

Cal. Public Resources Code - PRC 5.

in effect

Cal. Public Resources Code - PRC § 7051. Section 7051.

(a) The board of supervisors, boards of trustees, directors or other governing body of any county or other public or quasi-public corporation, body or agency authorized to acquire and hold real property pursuant to the statutory authority under which such county, corporation, body or agency is created may, under such limitations and restrictions as are prescribed by law, lease for the production of oil, gas and other hydrocarbons or for the mining of any other minerals whatsoever, any land owned by the county or such other public or quasi-public corporation, body or agency, or include such land in a community lease embracing adjoining lands, or enter into compensatory royalty agreements in lieu of making such lease, whenever, in the judgment of the governing body, the public use of such property shall not be substantially interfered with thereby. No land used, owned, dedicated, or acquired by purchase, condemnation, gift, or otherwise, as a public park, highway, street, walk, or public playground shall be so leased unless the use of such property for park, highway, street, walk or public playground purposes shall not be substantially interfered with thereby; provided, however, that if in the judgment of the governing body of any such park, highway, street, walk or public playground, drilling for oil or gas would not substantially interfere with the use of such property for park, highway, street, walk or playground purposes, then any such lease on any such property shall provide that drilling for oil or gas beneath the surface of such property shall be done by means of slant drilling from surface locations, outside the outer boundaries of any such property, or from designated locations inside the outer boundaries of such property, which inside locations have been approved by the county parks commission and will not interfere substantially with the use of such property for such park, highway, street, walk or playground purposes. No land owned or under the jurisdiction of the county or such other public or quasi-public corporation, body or agency lying within 300 feet above the line of high tide, or at any point below the line of high tide, of the Pacific Ocean, or any arm, bay, or inlet of the Pacific Ocean shall be leased for the drilling for and production of petroleum products or other minerals, unless the use of such property for public purposes shall not be substantially interfered with thereby; provided, however, that if in the judgment of the governing body of any such land, drilling for oil or gas would not substantially interfere with the use of such property for public purposes, then any such lease on any such property shall provide that drilling for oil or gas beneath the surface of such property shall be done by means of slant drilling from surface locations, outside the outer boundaries of any such property, or from designated locations inside the outer boundaries of such property, which inside locations have been approved by the governing body and will not interfere substantially with the use of such property for public purposes. (b) Notwithstanding any other provision of this section, no tide or submerged lands owned or under the jurisdiction of the county or such other public or quasi-public corporation, body or agency shall be leased for the exploration for, drilling for or production of petroleum products within the boundaries of the areas of the County of Los Angeles described in subdivision (a) of Section 6871.2 unless such lands are within one nautical mile of the ordinary high water mark, the applicable conditions of the Public Resources Code and requirements of the State Lands Commission have been met, and the drilling for oil and gas deposits is to be done by means of slant drilling from an upland site.

Cal. Public Resources Code - PRC § 7052. Section 7052.

Lands may be leased in tracts of such size and shape as the governing body may determine. Before executing a lease of any such property, the governing body shall in open meeting, by not less than a two-thirds vote of its members, adopt a resolution declaring its intention to lease the property. The resolution shall describe the property proposed to be leased in such manner as to identify it, specify the minimum rental and term for which it will be leased, the form of the lease or agreement, and one variable, biddable factor, on which bids will be received, and fix a time not less than three weeks thereafter and place for a public meeting of said governing body, at which meeting sealed proposals to lease will be received and considered. The resolution shall, before the date of such meeting, be published once a week for three successive weeks in one or more newspapers of general circulation in the county where the property is situated. This section shall not apply to the renewal or extension for a fixed term not exceeding the original term of leases or operating agreements initially issued for a fixed term. The State Lands Commission may in its discretion exempt particular leases or operating agreements from the procedure required by this section and Section 7053 where by reason of the small size of the property or drainage, actual or imminent, such procedure would in the judgment of the State Lands Commission in the particular case be impractical.

Cal. Public Resources Code - PRC § 7053. Section 7053.

At the time and place fixed in the resolution for the meeting, all sealed proposals which have been received shall in public session be opened, examined, and recorded by the governing body, and the property may be leased to the highest responsible bidder in the judgment of the governing body. The governing body may, should it deem such action for the best public interest, at any time reject any and all bids and withdraw the property from lease.

Cal. Public Resources Code - PRC § 7054. Section 7054.

An order to lease made by the governing body shall authorize and direct the execution and delivery by the chair or other presiding officer of a lease to the lessee.

Cal. Public Resources Code - PRC § 7054.5. Section 7054.5.

No lease or modification thereof or amendment thereto for the production, extraction, or removal of minerals, oil, gas, or other hydrocarbons from tide or submerged lands which have been granted by the State to a public agency in trust wherein the State has not reserved the minerals, shall be effective or shall be delivered to the lessee unless and until it has been approved by the State Lands Commission. Prior to adopting the resolution provided for by Section 7052, the governing body may petition the State Lands Commission for approval of the form of the resolution. When any public agency mentioned in Section 7056 has the right to designate drill sites or areas for the production of oil, gas or other hydrocarbons from tide or submerged lands pursuant to leases, operating agreements, other agreements, or modifications or amendments thereof, which are otherwise authorized by law, then such public agencies must first obtain the approval of the State Lands Commission before designating such drill sites or areas. Such designation and approval shall, as far as possible, conform to the legal requirements, policies and regulations applicable to the development of state-owned or controlled tide or submerged lands for the production of oil, gas or other hydrocarbons.

Cal. Public Resources Code - PRC § 7055. Section 7055.

Any money accruing from leases under this chapter shall be paid into the general fund of the county or other public or quasi public corporation, body or agency for the use of the county or other public or quasi public corporation, body or agency, as the case may be.

Cal. Public Resources Code - PRC § 7056. Section 7056.

The provisions of this chapter shall apply to all counties and to such public or quasi-public corporations, bodies and agencies as are not otherwise authorized by law to lease for the production of oil, gas and other hydrocarbons, or for the mining of other minerals, lands owned by such public or quasi-public corporation, body or agency, including, without limiting the generality of the foregoing, such of the following districts as are not otherwise authorized by law to lease land for such purposes, to wit: mosquito abatement districts, pest abatement districts, county sanitation districts, sanitary districts, local health districts, public cemetery districts, fire protection districts, park and recreation districts, placer mining districts, soil conservation districts, harbor and port districts, veterans memorial districts, school districts, airport districts, conservancy districts, flood control districts, drainage districts, irrigation districts, reclamation districts, levee districts, water districts, overflow districts, storm water districts and county power pumping districts; provided, however, that notwithstanding any other provisions of law authorizing the execution of such leases, the governing body of any district mentioned in this section may lease lands belonging to such district for the production of oil, gas and other minerals upon complying with the provisions of this chapter.

Cal. Public Resources Code - PRC § 7056.5. Section 7056.5.

The provisions of Sections 7051 to 7056, inclusive, shall apply to operating agreements and all other types of agreements entered into by the agencies mentioned in Section 7056 for the purposes described in Section 7051. This section does not constitute a change in, but is declaratory of, the pre-existing law.

Cal. Public Resources Code - PRC § 7057. Section 7057.

The property of any city may be leased for the purpose of producing or effecting the production of minerals, oil, gas or other hydrocarbon substances for a period not to exceed 35 years unless such property shall have been dedicated or acquired as a park, highway, street, walk or public playground, in which event such property may be leased for such purposes provided that the use of such property for park, highway, street, walk or public playground purposes shall not be substantially interfered with thereby; provided however, that if in the judgment of the governing body of any such park, highway, street, walk or public playground, drilling for oil or gas would not substantially interfere with the use of such property for park, highway, street, walk or playground purposes, then any such lease on any such property shall provide that drilling for oil or gas beneath the surface of such property shall be done by means of slant drilling from surface locations outside the outer boundaries of any such property, or from designated locations inside the outer boundaries of such property, which inside locations will not interfere substantially with the use of such property for such park, highway, street, walk or playground purposes. Such governing body shall prescribe such terms and conditions in such lease to the end that any drilling and producing operations will interfere as little as is possible with the use of the property for such park, highway, street, walk or playground purposes. The amendment of this section made at the 1959 Regular Session of the Legislature does not constitute a change in, but is declaratory of, the preexisting law. Notwithstanding any other provision of this section, no tide or submerged lands owned or under the jurisdiction of any city shall be leased for the exploration for, drilling for or production of petroleum products within the boundaries of the areas of the County of Los Angeles described in subdivision (a) of Section 6871.2 unless such lands are within one nautical mile of the ordinary high water mark, the applicable conditions of the Public Resources Code and requirements of the State Lands Commission have been met, and the drilling for oil and gas deposits is to be done by means of slant drilling from an upland site.

Cal. Public Resources Code - PRC § 7058. Section 7058.

Any city, county, city and county, or district, in the interest of increasing the ultimate recovery of oil or gas, or of the protection of oil or gas from unreasonable waste, or of the possible arresting or amelioration of land subsidence, may enter into unit or co-operative agreements with respect to all or any part or parts of land owned, possessed, controlled, held in trust by, or otherwise under the jurisdiction of, such city, county, city and county or district, for the purpose of bringing about the co-operative development and operation of all or a part or parts of the oil and gas field in which such lands are located, or for the purpose of bringing about the development or operation of all or a part or parts of such field as a unit, or for the purpose of fixing the time, location, and manner of drilling and operating of wells for the production of oil or gas, or providing for the return or injection of gas, water or other substances into the subsurface of the earth for the purpose of storage or the repressuring of such oil or gas field. If any such unit or co-operative agreement includes tide and submerged lands which have been granted to a city, county, or city and county by a grant which does not reserve to the State the right to produce oil and gas therefrom, then the agreement shall comply with the requirements of Section 6879 of this code, and shall bind the State only if approved by the State Lands Commission pursuant to the provisions of Section 6879. Subject to the foregoing, and notwithstanding any competitive bidding requirements or restrictions on term contained in this chapter, or any other statute, including but not limited to Section 718 of the Civil Code, Sections 37383 and 37384 of the Government Code and Chapter 29 of the 1956 Statutes, First Extraordinary Session, any such city, county, city and county, or district may negotiate and execute all agreements necessary to effectuate, implement or modify any such unit or co-operative agreement, including the power to bind and commit lands, including tide and submerged lands, or any interest in lands, to the co-operative or unit agreement for the full term thereof, irrespective of whether the term thereof is for a period extending over the life of the field or for any other indefinite period, and irrespective of the termination date of any lease, contract or other agreement then in effect as to such lands. The power of any such city, county, city and county, or district to enter into unit or co-operative agreements shall include the power to do such other acts or things and to incur such other commitments and obligations as are customary in unit or co-operative agreements. This section shall apply to any city, county, city and county, or district, irrespective of whether they are authorized by this chapter or any other statute to lease or develop lands for the production of oil, gas, and other hydrocarbon substances.

Cal. Public Resources Code - PRC § 7058.5. Section 7058.5.

Before a lease or any operating agreement or other type of agreement for the production of oil, gas, or other hydrocarbons is entered into after the effective date of this section, the governing body of a city shall in open meeting adopt a resolution declaring its intention to take such action. The resolution shall describe the property involved in such manner as to identify it, specify the minimum rental, royalty, or other consideration, and the term of the lease or agreement, the form of the lease or agreement, and one variable, biddable factor, on which bids will be received, and fix a time not less than 30 days thereafter and place for a public meeting of said governing body, at which meeting sealed proposals to lease or contract will be received and considered. The resolution shall, before the date of such meeting, be published once a week for four successive weeks in one or more newspapers of general circulation in the city where the property is situated, or, if there is no newspaper of general circulation in such city, in one or more newspapers of general circulation in the county where the property is situated. This section shall not apply to the renewal of leases or operating agreements issued for a fixed term; provided, that such renewals shall be subject to State Lands Commission approval as provided in Section 7060. As used in this section, governing body of a city means the city council, or other city board or agency having jurisdiction by charter or law over the property involved.

Cal. Public Resources Code - PRC § 7059. Section 7059.

At the time and place fixed in the resolution for the meeting, all sealed proposals which have been received shall in public session be opened, examined, and recorded by the governing body of the city, and the property shall be leased to, or the agreement shall be made and entered into with, the highest responsible bidder in the judgment of the governing body. The governing body may, however, should it deem such action for the best public interest, at any time reject any and all bids and withdraw the property from lease or contract. As used in this section, governing body of a city means the city council, or other city board or agency having jurisdiction by charter or law over the property involved.

Cal. Public Resources Code - PRC § 7060. Section 7060.

(a) No such lease or agreement shall be effective unless prior to adopting the resolution provided for by Section 7058.5 the city shall have petitioned the State Lands Commission for approval of the proposed resolution, and the proposed resolution shall have been approved by the State Lands Commission. (b) No city shall consent to the modification or amendment of any such lease or agreement without the advance consent of the State Lands Commission to such modification or amendment.

Cal. Public Resources Code - PRC § 7061. Section 7061.

The provisions of Sections 7058.5 to 7059, inclusive, shall be applicable to all general-law cities and shall be applicable to general-law and chartered cities with respect to tide or submerged lands granted in trust to such cities by the State where mineral rights have not been reserved to the State. Section 7060 shall be applicable to both general-law and chartered cities only with respect to tide or submerged lands granted in trust to such cities by the State, where mineral rights have not been reserved to the State. The provisions of Sections 7058.5 to 7060, inclusive, shall not apply to activities regulated by Chapter 29 of the Statutes of the 1956 First Extraordinary Session. The State Lands Commission may in its discretion exempt particular leases or operating agreements from the procedure required by Sections 7058.5 and 7059 where by reason of the small size of the property or drainage, actual or imminent, such procedure would in the judgment of the State Lands Commission in the particular case be impractical.

Cal. Public Resources Code - PRC § 7061.1. Section 7061.1.

Notwithstanding the provisions of Section 7058, no city, county, city and county, or district may enter into a unit or cooperative agreement pursuant to that section under which exploration for, drilling for, or production of petroleum products is proposed with respect to any part or parts of an oil and gas field located in tide or submerged lands which are within the boundaries of the areas of the county of Los Angeles described in subdivision (a) of Section 6871.2 unless such lands are within one nautical mile of the ordinary high water mark, the applicable conditions of the Public Resources Code and requirements of the State Lands Commission have been met, and the drilling for oil and gas deposits is to be done by means of slant drilling from an upland site.

Cal. Public Resources Code - PRC § 7062. Section 7062.

(a) On or before October 1st of each year, each city shall cause to be made and filed with the State Lands Commission a detailed statement of all revenue and expenditures thereof from any operating agreement or other type of lease or agreement for the production of oil, gas, or other hydrocarbons, including obligations incurred but not yet paid. Said statement shall cover the fiscal year preceding its submission and shall show the project or operation for which each such expenditure or obligation is made or incurred. (b) In addition to the other powers and duties specifically delegated to it, the State Lands Commission shall have authority to examine financial and operating records of any city relating to the production and sale of oil, gas, and other hydrocarbons under any operating agreement or other type of lease or agreement for the production of oil, gas, or other hydrocarbons and to conduct such other investigations and studies as it may deem necessary in connection therewith. The provisions of this section shall be applicable only with respect to tide or submerged lands granted in trust to cities by the State. The provisions of this section shall not apply to activities regulated by Chapter 29 of the Statutes of the 1956 First Extraordinary Session.

Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026