(1) A sale of oil and gas leases on state lands normally will be held once each quarter, on the first or second Tuesday of March, June and December, and on a day in September that will not conflict with the Labor Day holiday. It will be in the department's discretion to waive a sale on any of these dates if insufficient applications have been received or to postpone if circumstances warrant. In such event a notice of "no sale" will be published in the Montana oil journal or in a publication of general circulation in Montana as provided for in (2) . Sale of each lease will be by competitive, oral bidding, and sale will be made and a lease executed to the qualified bidder who makes the highest bid. In the absence of any bid at such sale, on a particular tract, a lease will be issued to the person who first made application therefore in accordance with these rules. The department reserves the right to reject any and all bids on any tract offered for lease.

(2) Any person who desires that any tract of state lands be offered for oil and gas leasing at sale as above described shall make application for oil and gas leasing on the form prescribed by the department and then in current use. Blank forms for such applications may be secured from the department at no cost. Such application shall be, in form, an application for the issuance of an oil and gas lease to the applicant, shall contain, among other things, an adequate and sufficient description of the land sought to be leased, and shall be deemed and considered for all purposes an offer to lease the lands described therein and a bid therefor in the amount of the minimum required first year's rental. There shall be submitted with the application, payment of a $10.00 application fee, and this shall be the only payment required to be submitted with the application; however, each application shall constitute an undertaking to pay, within 10 days after the lease sale, the required first year's rental for the lease if at the lease sale the first applicant is the successful bidder therefor. If at the lease sale the successful bidder is a person other than the first applicant, the person shall submit within 10 days after the sale the required first year's rental. In order to permit the necessary time for notice of sale as herein provided, applications should be filed with the department at least 40 days prior to the date fixed for sale, whenever possible. Any application made may be withdrawn by the applicant if request for such withdrawal is received by the department prior to the time when the second notice of the sale, as hereafter provided, is sent to the publisher, but the ten dollar application will not be refunded. Where more than one application is filed on any one tract, the department shall notify each person submitting an application subsequent to receipt of the first qualified application, that there is a prior application for that tract and shall return the application fee. Where the first applicant for a tract withdraws his application as provided above, and subsequent applications for that tract have been received, the tract shall be offered for lease regardless of the withdrawal. In such case the opening bid must not be less than the minimum rental required by ARM 36.25.208. If no bids are made the tract will not be leased.

(3) Notice of each sale shall be given by publications in the Montana oil journal, published in Billings, Montana, or in a publication of general circulation in Montana. There shall be at least 2 publications of notice, the first of which shall be within 15 days after the previous oil and gas lease sale, and need contain only the date and place of sale, as its purpose is to allow applicants to submit their applications prior to the 40 day deadline provided above. Other publications, the first of which shall be not more than 40 days prior to the date of the oil and gas lease sale, shall state the exact time and place of the forthcoming sale, shall state that all sales will be by competitive oral bidding, and shall describe each tract separately that will be offered for lease.

(4) The department will maintain a mailing list of prospective oil and gas lessees who request, in writing, that their names be placed on the list. At least 2 weeks before each sale, the department will mail to each addressee a copy of the notice of sale.