# § 229a. Water struck while drilling for oil and gas
**(a)** **Acquisition; condition in lease** All prospecting permits and leases for oil or gas made or issued under the provisions of this chapter shall be subject to the condition that in case the permittee or lessee strikes water while drilling instead of oil or gas, the Secretary of the Interior may, when such water is of such quality and quantity as to be valuable and usable at a reasonable cost for agricultural, domestic, or other purposes, purchase the casing in the well at the reasonable value thereof to be fixed under rules and regulations to be prescribed by the Secretary.
**(b)** **Prior leases** In cases where water wells producing such water have heretofore been or may hereafter be drilled upon lands embraced in any prospecting permit or lease heretofore issued under this chapter, the Secretary may in like manner purchase the casing in such wells.
**(c)** **Disposition** *Provided*
The Secretary may make such purchase and may lease or operate such wells for the purpose of producing water and of using the same on the public lands or of disposing of such water for beneficial use on other lands, and where such wells have heretofore been plugged or abandoned or where such wells have been drilled prior to the issuance of any permit or lease by persons not in privity with the permittee or lessee, the Secretary may develop the same for the purposes of this section: , That owners or occupants of lands adjacent to those upon which such water wells may be developed shall have a preference right to make beneficial use of such water.
**(d)** **Revolving fund** The Secretary may use so much of any funds available for the plugging of wells, as he may find necessary to start the program provided for by this section, and thereafter he may use the proceeds from the sale or other disposition of such water as a revolving fund for the continuation of such program, and such proceeds are hereby appropriated for such purpose.
**(e)** **Operations under lease not restricted** Nothing in this section shall be construed to restrict operations under any oil or gas lease or permit under any other provision of this chapter.
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**Source Credit**: (Feb. 25, 1920, ch. 85, § 40, as added June 16, 1934, ch. 557, 48 Stat. 977; amended Pub. L. 94–579, title VII, § 704(a), Oct. 21, 1976, 90 Stat. 2792.)
## Editorial Notes
### Amendments
1976—Subsec. (a). struck out proviso relating to reservation of land as a water hole under .
## Statutory Notes and Related Subsidiaries
### Effective Date of 1976 Amendment
, , , provided that the amendment made by section 704(a) is effective on and after .
### Savings Provision
Amendment by not to be construed as terminating any valid lease, permit, patent, etc., existing on , see , set out as a note under , Public Lands.