North Dakota can take your minerals away after 20 years of nonuse, and it has the lowest income tax of any taxing state where we buy. Absentee owners need to know both.
This is the whole guide, on one page, free, with nothing gated. It covers what you own, the North Dakota law that decides what lands in your bank account, whether your minerals can be taken from you, what happens if a well is drilled and you are not leased, what you owe when you sell, and the questions worth asking any buyer including us.
Almost every confusing thing in oil and gas comes from the fact that the mineral estate is not one thing. It is a bundle of five rights that can be split apart and sold separately:
A mineral interest is all five. A non-participating royalty interest is only the fifth, with no say in leasing and no share of bonus. An overriding royalty interest is carved out of a particular lease and dies when that lease dies. A working interest takes revenue net of costs and, unlike all of the above, can lose you money.
Which one you hold changes the value, the tax treatment, and who has to sign what. Start here: NPRIs, overriding royalties, and the glossary.
Generally deductible, subject to your lease. In *Bice v. Petro-Hunt, L.L.C.*, 2009 ND 124, the North Dakota Supreme Court adopted the at the well rule and the work back method and expressly rejected the first marketable product doctrine. Your lease language is what decides it.
Your first move if the deductions look wrong is a written demand by certified mail, keeping the receipt, because the certification is what starts the clock. Our free letter templates have the wording and the statement decoder explains every line on the stub.
First payment is due **150 days** after production is marketed, and the same 150 day standard governs ongoing payments. Late payment carries **18 percent per year**, which does not apply during a genuine title dispute. The statute is **N.D.C.C. § 47-16-39.1**.
| Minimum payment rule | Under $50 may be paid semiannually. |
| Time limit to sue over an underpayment | 6 years |
A stopped check very often is not a stopped well. The usual causes are a balance under the minimum threshold, a title change putting the interest in suspense, an unprobated death in the chain, an address the payor could not deliver to, or a change of payor after an acquisition. That money does not disappear; it sits in suspense and eventually goes to state unclaimed property. See unclaimed royalties.
**Yes.** Under **N.D.C.C. ch. 38-18.1**, a mineral interest unused for 20 years is deemed abandoned and the surface owner may publish notice and take title. Saving events under § 38-18.1-03 include production, injection, storage or disposal, a recorded instrument, and a recorded statement of claim.
Yes, through the Industrial Commission. Under **N.D.C.C. § 38-08-08(3)**, a leased owner who elects not to participate is charged **200 percent** of their share of reasonable actual costs. An **unleased** owner who does not participate is charged only **50 percent**, and that penalty applies only after the operator has made a good faith effort to lease. An unleased interest pooled on or after August 1, 2009 receives a **cost free 16 percent** royalty, which is better than most states.
The reason any of this exists is the rule of capture: a well on the tract next to yours can legally drain oil and gas from under your land, and you cannot sue anyone for it. Pooling is what converts being drained into having a share. The expensive mistake is almost never the pooling itself. It is missing the election deadline, which turns a real choice into a default nobody picked.
Severance tax. A 5 percent gross production tax plus a 5 percent oil extraction tax, with rate reductions tied to price triggers and well type.
When you sell. North Dakota taxes nonresidents on North Dakota source income, and gain on the sale of North Dakota minerals is North Dakota source. The good news: North Dakota has the **lowest top individual rate of any income tax state where we buy, 2.50 percent**. No state estate or inheritance tax.
See taxes when you sell mineral rights, and if you inherited the interest, understand the stepped-up basis before you sell anything: your basis is generally the value at the date of death, not what your grandparents paid, which frequently means far less taxable gain than owners expect.
North Dakota is a Uniform Probate Code state. Unprobated estates are common in Bakken mineral chains and interact badly with the 20 year abandonment clock.
The single most common thing we see is an interest still sitting in the name of someone who died twenty or forty years ago. It is fixable, it is cheaper to fix than to leave, and we pay for the curative work as part of a purchase. See inherited mineral rights, selling before probate is done, and transferring inherited minerals.
North Dakota Industrial Commission for well records, one of the best free public well databases in the country, and the Register of Deeds in each of 53 counties for land records.
Our well records by state page links every state's free public search, and our operator directory covers more than 38,000 operators with contact information refreshed weekly.
Producing royalties are priced off cash flow and decline. Non-producing minerals are priced off location and activity. Almost every offer you receive is built the same way: take your last twelve months of royalty income and apply a multiple.
That method has one predictable failure, and it is worth understanding because it is where most owners lose money. It assigns a value of zero to anything that has not happened yet. A permit next door. An undrilled bench under your section. A refrac on an old wellbore. A unit being formed. None of that is in last year's income, so none of it is in the offer.
Ask any buyer, including us, to show you their remaining location count and the reasoning behind it. If they will not break it out, they are pricing your check rather than your minerals. See how mineral rights are valued.
You are welcome to use every one of these on us. That is the point of publishing them.
A check stub, an old deed, a division order, a pooling order, or just the county. We will identify the interest, value it with the arithmetic shown, and tell you honestly if you should keep it. Free, no obligation, and no mailing list.
Get a Free Valuation Ask a LandmanLast reviewed August 2026. Statutes, rates, and case law change, and where North Dakota law is genuinely unsettled we have said so rather than filling the gap. Berlin Royalties is a mineral buyer and a landman shop in Tulsa, not a law firm or a tax advisor, and this guide is general information rather than advice about your interest. For a dispute worth real money, hire a lawyer in North Dakota.