(a) An oil or gas royalty due under a lease on university lands shall be paid in kind at the discretion of the board.
(b) The option to take royalty in kind or to take cash royalties may be exercised by the board at any time or from time to time on not less than 60 days’ notice to the lessee.

(c) The board shall enter into contracts or other instruments or agreements to dispose of the portion of the royalty taken in kind, which may include contracts for sale, transportation, or storage of the oil or gas. The commissioner shall execute contracts approved by the board under this section that are consistent with applicable law.
(d) The board of regents may enter into insurance contracts or other agreements to secure or guarantee payment of contracts or other instruments or agreements to dispose of the portion of the royalty taken in kind, including contracts for sale, transportation, and storage.
(e) If the board has elected to take royalty in kind, the board may elect that delivery of the correct amount of oil or gas shall be at the wellhead, at the oil and gas separator, into a pipeline connected at the well, or at such other location as may be specified in a royalty in kind provision in the lease or other agreement. Such delivery by the lessee shall satisfy the lessee’s obligation for payment of the royalty due under the lease. This section shall not be construed to surrender or in any way affect the right of the board of regents under existing or future leases to receive royalty on the basis of market value of production not taken in kind.