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County minerals bring $613 million at lease sale

Posted 8/19/09 (Wed)

By Tina Foreman
Farmer Staff Writer

McKenzie County state land mineral leases netted an average of $712 per acre during the Aug. 4 sale held by the North Dakota State Land Department.
“Overall, the number of bidders for the August sale was a little above the last sale,” says Gary D. Preszler, North Dakota State Land Department commissioner. “Interest was primarily driven by the Bakken play, including the Three Forks Sanish Sands in McKenzie County.”
The quarterly sale included 7,894 acres in McKenzie County which sold for more than $613 million to 13 different entities.
“We had 48 entities that registered for bidder numbers,” says Preszler. “But that isn’t all that meaningful as some registered brokers may be bidding for more than one client.”
According to Preszler, the reason for such a large sale and higher bidders is due to the learning curve and time frame of the Bakken play.
“It has been about five years since the Bakken play started to pick up and leases come up for auction every five years,” states Preszler. “During those five years, the learning curve for the Bakken has allowed for more successful drilling techniques within the Bakken making it a more favorable play.”
The highest sale in McKenzie County was $4,900 for an 80-acre tract of land.
“Overall we were very satisfied with the sale,” adds Preszler. “The average sale per acre for the 11 counties included in the sale was $501 per acre, a new record.”
Mountrail County brought the highest average price per acre, at $1,127 per acre. One tract of land there sold for $7,600 an acre for 20 acres.
Total premiums paid out to just over $18 million for the state’s Common Schools Trust Fund.
The next sale will be held on Nov. 3. More information on this sale or the August sale can be found at www.land.nd.gov