Jay Daniels: Negotiating oil and gas leases in Indian Country

Wednesday, January 30, 2013  

"The current oil & gas (O&G) boom has created sweet and sour ripples throughout Indian Country. O&G has been a blessing in this cycle of uncertainty with the United States economy, but also has created a Black Hills gold rush assault on Indian lands not seen for a while. Although this article is somewhat lengthy, it is important and urgent that you understand what your rights are before it’s too late. Too many folks have told me the “BIA didn’t tell me that.” Of course, who gives away all of their secrets? Negotiating power is in what you know and the other party doesn’t.

The Bureau of Indian Affairs (BIA) revised their Fluids and Mineral Handbook on August 14, 2012. The handbook provides guidance for the BIA in the oil and gas leasing process. The handbook includes applicable federal statutes and regulations and sample forms used in every facet of managing a lease including leasing, assignments, change of name, etc. The forms are sample forms except for the Lease form on page 99 of the handbook, but it can include additional stipulations. One of the greatest misconceptions is that a mineral owner cannot deviate from the O&G lease form provided by the Bureau of Indian Affairs (BIA).

Another misconception is that mineral owners must accept the terms and conditions BIA negotiates on their behalf and determines is in your best interest. If that were true, the BIA needs to remove 25 CFR § 212.20 from their regulations. This regulation provides that Indian mineral owners may (emphasis added) request the Secretary to prepare, advertise and negotiate (emphasis added) mineral leases on their behalf."

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Jay Daniels: Negotiating Oil and Gas Leases in Indian Country (Indian Country Today 1/30)

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