Show TEXAS COMPANY AGREES TO DRILL RIVER BED OIL LEASES BEFORE JUNE I 1 under the terms of an agreement executed at salt laka city tuesday the texas production company is granted by the state land board an extension from april 1 to june 1 to commence drilling for oil in the bed of colorado ner in the vicinity of the big six and shafer structures below moab the state land board also agreed to the transfer of three oil leases from M P smith to the texas company and also agreed to consolidate the three leases into one tract judge F W freeman vice president of the company was in salt lake to close the deal with mr smith and associates and to meet with the state board under the terms of the state lease the lessee must pay the state of utah 12 oer cent royalty the texas company has also guaranteed mr smith and associates the original holders of the leases a substantial cash bonus a royalty on all oil as well as an extra bonus out of production the texas company has bound itself to commence drilling by the first of june mr freeman stated that the company would order a boat and that an engineering party would be sent to moab at once to make a of the river and pick out drilling sites the texas company also agrees to bear all the cost of litigation in case the legality of its leases is attacked by the government or the holders of government permits on the land the texas company to protect its leases will be required to drill a large number of offsetting wells and it is contended a healthy petition for the development of the field will follow the terms of the lease to the texas require the drilling at once of a well in the vicinity of the midwest gusher on the big six or cane creek dome governor dern voted against the proposal ta consolidate the three leases into one and the extension of time until june 1 for commencing drilling while H E crockett sec 1 retard of state and attorney general harvey duff the other members voted favorably the last two took the position that this affords an excellent opportunity to get a real test decision from the courts on the legal question of the states title to lands under the waters of navigable streams and lakes the cost of such litigation will undoubtedly be heavy in this case it will be borne by a company financially able to carry it through to a successful i conclusion y i J A elmer reached moab last night fram monrovia calif where he had been located for tha past year he states that ha is glad to get back chomej ho w |