3310. Disposition of natural resources.--Where any part of the principal consists of any
interest in lands, including royalties, overriding royalties, and working interests, from which may be
taken timber, minerals, oil, gas, or other natural resources and the trustee or tenant is authorized by
law or by the terms of the transaction by which the principal or trust was established to sell, lease, or
otherwise develop such natural resources, and no provision is made for the disposition of the net proceeds
thereof after the payment of expenses and carrying charges on such property, such proceeds, if received as
extension payments on a lease or bonus for the execution of the same, shall be deemed income, but if
received as consideration whether as royalties or otherwise, for the permanent severance of such natural
resources from the lands, shall be apportioned to principal and income as follows:
Such percentage thereof as is permitted to be deducted for depletion under the then existing laws of
the United States for federal income tax purposes shall be treated as principal and invested or held for
the use and benefit of the remainderman, and the balance shall be treated as income subject to be disbursed
to the tenant or person entitled thereto, or if no provision for such deduction for depletion is made by
the then existing federal laws, then twenty percent (20%) of the net proceeds thereof each year shall be
treated as principal and invested or held for the benefit of the remainderman and the balance shall be
treated as income and subject to be disbursed to the tenant or person entitled to receive such income. Such
disposition of proceeds shall apply whether the property is producing or nonproducing at the time the trust
becomes effective.