This provision provides for the assignor to except from this assignment and reserve an overriding royalty interest of all oil, gas, casinghead gas, and other minerals that may be produced from the lands under the terms of the Leases that are the subject of this assignment.
North Dakota Reservation of Overriding Royalty Interest (ND-ROI) is a legal arrangement commonly used in oil and gas leases in North Dakota. It refers to the reservation of a specific interest, often a royalty, for the benefit of the granter or a third party. Keywords: North Dakota, Reservation of Overriding Royalty Interest, legal arrangement, oil and gas leases, royalty, granter, third party. The ND-ROI grants the granter or a designated third party the right to receive a portion of the royalty interest generated from the production of oil and gas. This reservation is distinct from the traditional mineral rights typically associated with a lease. By reserving an overriding royalty interest, the granter secures a separate interest in the production revenue, ensuring a continuous stream of income even if the leasehold is transferred to another party. There are different types of North Dakota Reservation of Overriding Royalty Interest, which include: 1. Non-Participating Royalty Interest (NPR): In this type, the granter reserves a percentage of the royalty interest but does not possess the right to participate in the exploration, production, and management of the leased property. The NPR interest is considered burdensome on the lessee and their working interest. 2. Carved-Out Overriding Royalty Interest: This type allows the granter to reserve a fixed or percentage interest from the overall royalty interest. It is typically carved out from the working interest or the total royalty interest either horizontally or vertically across different leases or formations. 3. Subordinated Overriding Royalty Interest (SORT): A SORT provides the granter with an interest in the overriding royalty that is junior to the lessee's existing royalty interests. This means that the SORT will only receive payment after the senior royalty interests have been satisfied. 4. Free-Standing Overriding Royalty Interest: This type of ROI exists independently of other interests or leasehold and is often created separately from the working interest. The free-standing ROI can be negotiated separately between the granter and the lessee and may have its own specific terms and conditions. North Dakota Reservation of Overriding Royalty Interest plays a significant role in the oil and gas industry in North Dakota by allowing granters to retain a portion of the revenue generated from the lease, providing a steady income stream. It offers a unique way for landowners to participate in the benefits of the mineral exploitation without directly participating in the operations or management of the lease.
