3504.26 May I create overriding royalties on my Federal lease§ 3504.26 May I create overriding royalties on my Federal lease?
(a) BLM may order you to suspend or reduce your overriding royalties to as low as one percent if we determine your overriding royalty could:
(1) Cause you to abandon your lease prematurely; or
(2) Prevent mining of marginally economic or low-grade deposits.
(b) Where more than one overriding royalty interest is involved, BLM will apply any suspension or reduction to these interests in the manner agreed upon by the interest holders. If there is no agreement, we will order suspensions and reductions starting with the most recent interest and continuing in reverse order of the dates the overriding interests were created.
(c) If you apply for a royalty rate reduction under subpart 3513, of this part, we may request that you reduce your overriding royalties.