I have inherited mineral rights (North Haas fields) in Bottineau county ND a few years ago and at that time the lease was at its end. Now there is another broker wanting to lease the mineral rights and has made a proposal of $50/ac to lease 3 years and 15% royalties if oil is found. Is this the going rate? Are these rate negotiable?
This broker is wanting to lease at least 640 ac which my minerals right will be a part of. I'm not sure if this a good proposal. If I do not lease could I be forced to pool? I think there is one active well in the area and a few abandoned wells.
Bryan, you could be force pooled, and receive the weighted average of what everyone else in the spacing leased for or 16% royalty whichever the operator elects, so if everyone else leased for 15%, you would receive 15%. If everyone leased for more than 16% you would receive at least 16%. I think odds are good that someone will negotiate the offer to 16.67% or 17%. You are not taking great risk in my opinion by not leasing unless you have alot of net acreage. The rates are negotiable. One of the best negotiating tactics is to say no, don't talk to them anymore and let them send you offers. If your lessee does not think that your lease is worth more than 15% royalty, I would rather wait for one to come along who did, the oil isn't going to evaporate. My personal opinion.
Force pooling is not as fearsome in ND as some would like it to sound. Many do not understand it. A search of this site on forced pooling will help your understanding of it and you cam also read the law itself online NDCC 38-08-08. The only confusing part of the law, which I have found confuses professional and layman alike, is that for the mineral owner there is a risk penalty of 50% which can only be recovered from production. If the well is dry or low producing, you owe nothing out of pocket. Only if you leased the minerals from someone else are you subject to the 200% risk penalty. I hope this helps.