Dunn County ND Lease Offer

Oil and Gas Leasing Help
1

We recently inherited mineral rights in Stark, Dunn, and Mercer counties. We’ve received an offer on one of the Dunn County sections–T 144 N, R 93 W, Sec 18, SE/4. The offer is for $500/acre and 18% royalty, free of cost in the pipeline.

I’m somewhat familiar with going rates in the Permian, but know nothing about ND. Are these reasonable terms? Is it worth asking for a gross proceeds lease and Pugh clause, or are those non-starters in ND?

2

You can try to ask for gross proceeds, but rare in ND. “Free of cost in the pipeline” probably does not mean what you would like it to mean. You can try for a depth clause and several other important clauses. And I always ask for more royalty.