(1) Exploration operations shall be conducted in compliance with all federal, state, and local laws, and all ordinances, rules and regulations which are applicable to such operations. Particularly, permittee shall comply with the oil and gas rules on state lands, oil and gas lease stipulations, if any, on those lands, and the bonding requirements before commencing operations.

(2) The permittee shall take such measures for the prevention and suppression of fire on the permit area and other adjacent lands used or traversed by the permittee as are required by applicable laws and regulations. When in the opinion of the department weather and other conditions affecting fire incidence and control make special precautions necessary to protect the area, the permittee shall take such additional or other fire prevention and control measures as may be required by the department.

(3) The permittee shall obtain appropriate permission to use water necessary for the exploration activities. This normally will require a permit from the owner of the water right.

(4) The permittee shall make satisfactory adjustment of any damages sustained by the owner to the surface of the lands or sustained by the surface lessee to his leasehold interest in connection with operations by the permittee. The surface lessee should not receive damages over and above his annual rental unless special circumstances are demonstrated.