(1) A board of education of a school district has the power to lease any real property or any interest therein owned by the district for oil and gas exploration, development, and production purposes, upon such terms and conditions as may be prescribed and contracted by the board in the exercise of its best judgment as the board deems to be for the best interests of the district. Any lease of oil and gas rights shall be for a term not to exceed ten years and as long thereafter as oil or gas is produced, and shall provide for a royalty of not less than twelve and one-half percent of all oil and gas produced, saved, and sold, or the gross production value thereof, which royalty may be reduced proportionately under appropriate provision in the lease if the interest in the school district is less than a full interest in the land or oil and gas rights in the land described in the lease. Whenever in the opinion of the board of education, and because of the size, shape, or current use of any tract of land owned by the district, the best interests of the district so require, any lease of such tract may provide that no drilling shall be conducted on the land covered thereby, in which case such lease shall be for a term not to exceed ten years and so long thereafter as the district may share in royalties payable on account of production of oil or gas from lands adjacent to such tract so leased. (2) Whenever deemed by the board of education of a school district to be in the best interests of the district, it may enter into a unit agreement providing for the pooling, unitization, or consolidation of acreage covered by any oil and gas lease executed by the district with other acreage for oil and gas exploration, development, and production purposes, and providing for the apportionment or allocation of royalties among the separate tracts of land included in the unit or pooling agreement on an acreage or other equitable basis, and may change, by such agreement, with the consent of the lessee under the lease, any or all of the provisions of any lease issued by the district, including the term of years for which the lease was originally granted, in order to conform such lease to the terms and provisions of the unit or pooling agreement and to facilitate the efficient and economic production of oil and gas from the lands subject to such agreement. (3) The leasing of school district real property or any interest therein under the provisions of this section shall not be deemed to be a sale of such school property. (4) All leases of oil and gas or rights therein and all unit agreements relating to or dealing with oil and gas and containing provisions similar to those set forth in this section affecting school district lands heretofore made or entered into by any school district are hereby confirmed, validated, and declared to be legal and valid in all respects.
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