Louisiana Royalty Payment Law: Deadlines, Interest and Owner Remedies

Louisiana royalty payment rules at a glance

Main statute: Louisiana Mineral Code, La. R.S. Title 31.

First payment deadline

The Mineral Code (Title 31) sets no fixed deadline for a lessee's first royalty payment to its lessor; La. R.S. 31:137-141 set a notice-and-cure procedure for unpaid lessor royalties instead. Two narrower statutes set deadlines: a unit operator that sells or disposes of unit production must pay unleased owners in a compulsory unit who have not arranged to sell their own share within 180 days of each sale, and a third-party oil purchaser holding a declaration of interest must pay that claimant within 60 days. The third-party purchaser rules in La. R.S. 31:210.2 do not apply to payments due to a mineral lessor or anyone else with the Article 137–142 nonpayment remedy, unless that person elects to contract directly with the purchaser for the sale of his share of production.

When a compulsory unit includes unleased interests whose owners have not arranged to sell their share, the unit operator must pay those owners their tract's pro rata share of sale proceeds within 180 days of the sale. (La. R.S. 30:10(A)(4))

Statute text “the unit operator shall pay to such party or parties such tract's pro rata share of the proceeds of the sale or other disposition of production within one hundred eighty days of such sale or other disposition”

A third-party purchaser of oil and condensate that has received a claimant's declaration of interest must pay amounts due within sixty days. (La. R.S. 31:210.2(C)(2))

Statute text “If the third party purchaser has received a declaration of interest from the claimant, the third party purchaser shall pay the claimant any amounts due for the production within sixty days.”

Section 210.2 does not apply to payments due to a mineral lessor or any person with the Article 137–142 remedy for nonpayment or delayed payment, except where that person elects to contract directly with the third-party purchaser for the sale of his share of production. (La. R.S. 31:210.2(C)(5))

Statute text “The provisions of this Article shall not apply to payments due to a mineral lessor or any person who is afforded a remedy under Articles 137 through 142 for nonpayment or delayed payment of sums due, except where such persons elect to contract directly with the third party purchaser for the sale of his share of production.”

Later payments

No Mineral Code section sets a monthly or other recurring deadline for lessor royalties. The 180-day rule in La. R.S. 30:10(A)(4) applies to each sale from a compulsory unit, but only to unleased owners who have not arranged to sell their own share, where the unit operator sells or disposes of the production. Small amounts may be accumulated (see minimum payments).

The 180-day deadline for unleased owners in a compulsory unit runs from each sale or other disposition of unit production. (La. R.S. 30:10(A)(4))

Statute text “and the unit operator sells or otherwise disposes of such unit production, then the unit operator shall pay to such party or parties such tract's pro rata share”

Minimum payment and aggregation

Unless the owner asks otherwise, a payor may accumulate proceeds and pay annually when 12 months of proceeds total less than $100. If the owner asks in writing, proceeds totaling more than $25 but less than $100 must be paid monthly. Before accumulating, the payor must tell the owner about the monthly-payment option. Everything accumulated must be paid when production stops or payment responsibility is transferred. A separate rule lets a third-party oil purchaser suspend payment when 12 months of proceeds total $25 or less; it does not reach payments due to a mineral lessor or others with the Article 137–142 remedy unless they contract directly with that purchaser.

Proceeds may be accumulated and paid annually when the twelve-month total is less than $100, unless the owner requests otherwise. (La. R.S. 31:212.32(A))

Statute text “Unless otherwise requested, proceeds from production of oil and gas may be accumulated and remitted to the persons entitled thereto annually for the twelve months accumulation of proceeds totaling less than one hundred dollars.”

On written request, proceeds totaling more than $25 but less than $100 must be paid monthly; amounts under $10 are paid annually if requested in writing. (La. R.S. 31:212.32(B))

Statute text “Proceeds totaling less than one hundred dollars but more than twenty-five dollars shall be remitted monthly if requested in writing by the person entitled to the proceeds. Amounts less than ten dollars shall be remitted annually if requested in writing”

Before accumulating proceeds, the payor must notify the owner of the option to be paid monthly when accumulated proceeds exceed $10, with directions for requesting it. (La. R.S. 31:212.32(C))

Statute text “Before proceeds may be accumulated, the payor shall provide notice to the person entitled to such proceeds that there is an option to be paid monthly when the accumulated proceeds exceed ten dollars.”

All accumulated proceeds must be paid when production ceases or when payment responsibility is relinquished or transferred. (La. R.S. 31:212.32(D))

Statute text “all accumulated proceeds shall be paid to the owner thereof when production ceases or upon relinquishment or transfer of the payment responsibility”

A third-party purchaser of oil and condensate may suspend payment, without interest or penalty, when the twelve-month total is $25 or less (this section does not reach payments due to a mineral lessor or others with the Article 137–142 remedy unless they contract directly with the purchaser). (La. R.S. 31:210.2(D))

Statute text “A third party purchaser of oil and condensate may suspend payment without incurring any interest or penalties to any payee if the aggregate twelve-month accumulation of proceeds totals twenty-five dollars or less.”

Interest on late payments

Late royalties bear interest from the date they were due. For lessors, R.S. 31:139 and 31:140 say 'interest' without setting a rate. R.S. 31:212.23 (non-lessor royalty and production-payment owners) and R.S. 31:210.1 (purchasers delaying payment over title or division orders) use the 'legal interest' or 'legal rate', which these sections do not set. Double damages are available in the cases listed under owner remedies.

If the lessee pays after notice and the original failure was mere oversight or neglect, damages are limited to interest from the date due, plus attorney's fees if that interest is not paid within 30 days of written demand. (La. R.S. 31:139)

Statute text “In all other cases, such as mere oversight or neglect, damages shall be limited to interest on the royalties computed from the date due, and a reasonable attorney's fee if such interest is not paid within thirty days of written demand therefor.”

For royalty owners other than the mineral lessor, an obligor that pays the amount due plus legal interest from the due date ends the owner's claim. If it does not pay but states a reasonable cause, damages are limited to legal interest from the due date. (La. R.S. 31:212.23(A)-(B))

Statute text “If the obligor fails to pay within the thirty days from notice but states a reasonable cause for nonpayment, then damages shall be limited to legal interest on the amounts due from the date due.”

A purchaser that delays payment pending proof of clear title or a valid division order owes legal-rate interest on money held more than 30 days after payment was due, from the contract due date until disbursement. This section does not apply to payments due to anyone with a remedy under R.S. 31:137-142 or 31:212.21-212.23. (La. R.S. 31:210.1(A)-(B))

Statute text “interest at the legal rate over the time period of the delay shall be paid by the purchaser on all money held for more than thirty days after payment would be due after delivery under the purchase contract. The interest earning period shall be from the date payment is due under the contract to the day disbursement is made. … B. The provisions of this section shall not apply to payments due to any person who is afforded a remedy under R.S. 31:137 through 31:142 or under R.S. 31:212.21 through 212.23 for nonpayment or delayed payment of sums due.”

Suspense and withheld payments

A lessee may not withhold royalties because the lessor has not signed a division order. Nonpayment is deemed reasonable if the lessor does not supply name, address and tax ID on written request. A purchaser may delay payment pending clear title or a valid division order, but it owes legal-rate interest on money held more than 30 days; that rule does not apply to payments due to mineral lessors or other owners with the Article 137-142 or 212.21-212.23 remedies. A third-party oil purchaser may withhold until it receives a declaration of interest, and must then hold disputed payments in an interest-bearing account; the third-party purchaser rules in La. R.S. 31:210.2 do not apply to payments due to a mineral lessor or anyone else with the Article 137–142 nonpayment remedy, unless that person elects to contract directly with the purchaser for the sale of his share of production.

Signing a division order is not a condition of payment, and a lessee may not withhold royalties because the lessor has not signed one. (La. R.S. 31:138.1(C))

Statute text “The execution of a division order is not a condition precedent to receiving payment from a lessee. The lessee shall not withhold royalty payments because his lessor has not executed a division order.”

A lessee's nonpayment is deemed reasonable if the lessor fails, on written request, to supply name, address and tax identification number. (La. R.S. 31:138.1(D))

Statute text “if the lessor fails to supply the name, address, and tax identification number upon written request of the lessee, the lessee's failure to pay royalties shall be deemed reasonable”

A purchaser may delay payment pending proof of clear title or a valid division order, but must pay legal-rate interest on funds held more than 30 days past the due date. This section does not apply to payments due to anyone with a remedy under R.S. 31:137-142 or 31:212.21-212.23 (mineral lessors and other royalty or production-payment owners). (La. R.S. 31:210.1(A)-(B))

Statute text “the purchaser is delaying payment for the production, pending receipt of proof of clear title or a valid division order or both, interest at the legal rate over the time period of the delay shall be paid … B. The provisions of this section shall not apply to payments due to any person who is afforded a remedy under R.S. 31:137 through 31:142 or under R.S. 31:212.21 through 212.23 for nonpayment or delayed payment of sums due.”

Until it receives a declaration of interest, a third-party purchaser of oil and condensate may withhold payment. (La. R.S. 31:210.2(B))

Statute text “Until receipt of a declaration of interest, a third party purchaser of oil and condensate is fully protected and may withhold payment for the production.”

If reasonable cause for nonpayment exists, or no declaration of interest has been received, the third-party purchaser must deposit the payments into an interest-bearing account. (La. R.S. 31:210.2(C)(4))

Statute text “the third party purchaser shall deposit any payments due into an interest-bearing account”

A third-party purchaser's withholding is not reasonable cause for the lessee's nonpayment of royalty under Article 138. (La. R.S. 31:210.2(C)(6))

Statute text “The withholding of payments by a third party purchaser pursuant to this Article shall not constitute reasonable cause for nonpayment of royalty pursuant to Article 138.”

Division orders

A division order cannot alter or amend the mineral lease. Any variance is invalid, and the lease controls. Signing a division order is not a condition of payment. A lessee that withholds royalties solely because the lessor has not signed one faces double damages, interest and attorney's fees, unless the lessor failed to supply name, address and tax identification number on the lessee's written request, in which case the nonpayment is deemed reasonable.

A division order may not alter or amend the mineral lease; to the extent it varies the lease it is invalid, and the lease controls. (La. R.S. 31:138.1(B))

Statute text “A division order shall not alter or amend the terms of the mineral lease. A division order that varies the terms of the mineral lease is invalid to the extent of the variance, and the terms of the mineral lease take precedence.”

If a lessee fails to pay solely because the lessor has not signed a division order, the court must award double the royalties due, legal interest from the due date, and reasonable attorney's fees; but if the lessor fails to supply name, address and tax identification number on the lessee's written request, the nonpayment is deemed reasonable. (La. R.S. 31:138.1(D))

Statute text “the court shall award as damages double the amount of royalties due, legal interest on that sum from the date due, and reasonable attorney's fees. However, if the lessor fails to supply the name, address, and tax identification number upon written request of the lessee, the lessee's failure to pay royalties shall be deemed reasonable.”

Owner remedies, notice and attorney fees

A lessor must give the lessee written notice of nonpayment before suing for damages or dissolution. The lessee then has 30 days to pay or to state in writing a reasonable cause. If the lessee fails to pay or fails to state a reasonable cause, the court may award double the royalties, interest and attorney's fees, and may dissolve the lease. Dissolution is disfavored. Royalty and production-payment owners other than the lessor have a parallel notice remedy (no dissolution).

Written notice of the failure to pay is a prerequisite to a lessor's suit for damages or dissolution. (La. R.S. 31:137)

Statute text “he must give his lessee written notice of such failure as a prerequisite to a judicial demand for damages or dissolution of the lease”

The lessee has 30 days after receiving notice to pay or to state in writing a reasonable cause for nonpayment. (La. R.S. 31:138)

Statute text “The lessee shall have thirty days after receipt of the required notice within which to pay the royalties due or to respond by stating in writing a reasonable cause for nonpayment.”

If the lessee pays after notice, dissolution is unavailable unless the original failure was fraudulent. Double damages, interest and attorney's fees are possible only if that failure was fraudulent, or willful and without reasonable grounds. (La. R.S. 31:139)

Statute text “The court may award as damages double the amount of royalties due, interest on that sum from the date due, and a reasonable attorney's fee, provided the original failure to pay royalties was either fraudulent or willful and without reasonable grounds.”

If the lessee fails to pay, or fails to inform the lessor of a reasonable cause for not paying, in response to the notice, the court may award double damages, interest and attorney's fees, and may dissolve the lease in its discretion. (La. R.S. 31:140)

Statute text “If the lessee fails to pay royalties due or fails to inform the lessor of a reasonable cause for failure to pay in response to the required notice, the court may award as damages double the amount of royalties due, interest on that sum from the date due, and a reasonable attorney's fee regardless of the cause for the original failure to pay royalties. The court may also dissolve the lease in its discretion.”

Dissolution should be granted only if damages are inadequate to do justice. (La. R.S. 31:141)

Statute text “dissolution should be granted only if the conduct of the lessee, either in failing to pay originally or in failing to pay in response to the required notice, is such that the remedy of damages is inadequate to do justice”

Royalty owners other than the mineral lessor, and production-payment owners, must also give written notice before suing for damages. (La. R.S. 31:212.21)

Statute text “he must give his obligor written notice of such failure as a prerequisite to a judicial demand for damages”

For those owners, if the obligor neither pays nor states a reasonable cause, the court may award double the amount due, legal interest and attorney's fees. (La. R.S. 31:212.23(C))

Statute text “If the obligor fails to pay and fails to state a reasonable cause for failure to pay in response to the notice, the court may award as damages double the amount due, legal interest on that sum from the date due, and a reasonable attorney's fee”

A purchaser of production under a division order may be compelled by writ of mandamus to pay sums due. (La. R.S. 31:211)

Statute text “a purchaser of production under any division order, or a purchaser of production from a lease under which the lessee's royalty obligation to the lessor has been satisfied by the delivery of production to the purchaser may be compelled by writ of mandamus”

A third-party oil purchaser that fails to pay a claimant holding a declaration of interest, or fails to inform the claimant of reasonable cause for nonpayment, within 60 days may be liable for damages up to 50% of the amount due, plus legal interest, attorney's fees and costs. This remedy does not reach payments due to a mineral lessor or others with the Article 137–142 remedy unless they contract directly with the purchaser. (La. R.S. 31:210.2(C)(3))

Statute text “the court may impose damages in an amount not to exceed fifty percent of the amount due, plus legal interest on the amount due on the date the required notice was received and reasonable attorney's fees and court costs”

Check-stub disclosures

Every payment for oil or gas production to a royalty or working interest owner must include nine items on the check stub or an attachment, unless the information is otherwise provided on a regular basis. The items include the well or unit, month and year of sale, volumes, price, taxes, decimal interest and the owner's gross and net share.

Payment information must accompany each payment to an interest owner, whether paid under a division order, lease, servitude or other agreement, unless otherwise provided on a regular basis. (La. R.S. 31:212.31(B))

Statute text “Whenever payment is made for oil or gas production to an interest owner, whether pursuant to a division order, lease, servitude, or other agreement, all of the following information shall be included on the check stub or on an attachment to the form of payment, unless the information is otherwise provided on a regular basis”

Required items: lease identification or agreement reference with well/unit identification; month and year of sales; total barrels or MCF purchased; the owner's final realizable price per barrel or MCF. (La. R.S. 31:212.31(B)(1)-(4))

Statute text “(1) Lease identification number, if any, or reference to appropriate agreement with identification of the well or unit from which production is attributed. (2) Month and year of sales or purchases included in the payment. (3) Total barrels of crude oil or MCF of gas purchased. (4) Owner's final realizable price per barrel or MCF.”

Further items: total severance and other production taxes; net value of total sales after taxes; the owner's decimal interest; the owner's share of total sales before taxes; and the owner's share after production and severance taxes. (La. R.S. 31:212.31(B)(5)-(9))

Statute text “(7) Interest owner's interest, expressed as a decimal fraction, in production from (1) above. (8) Interest owner's share of the total value of sales prior to any tax deductions. (9) Interest owner's share of the sales value less his share of the production and severance taxes, as applicable.”

Unclaimed royalties (escheat)

Under Louisiana's unclaimed property law, mineral proceeds are presumed abandoned two years after they become payable or distributable, if the owner has not claimed them or shown interest. The program is run by the Louisiana State Treasurer.

Mineral proceeds are presumed abandoned two years after the property is payable or distributable. (La. R.S. 9:154(A)(14))

Statute text “(14) Mineral proceeds, two years after the property is payable or distributable.”

Property is unclaimed if, during that period, the owner has not communicated with the holder about it or otherwise indicated an interest in it. (La. R.S. 9:154(C)(1))

Statute text “Property is unclaimed if, for the applicable period of time set forth in Subsection A of this Section, the apparent owner has not communicated, in writing or by other means reflected in a contemporaneous record prepared by or on behalf of the holder, with the holder concerning the property”

Official unclaimed property search: Louisiana State Treasurer - Unclaimed Property.

Scope notes

• La. R.S. 31:137 to 31:141 protect the mineral lessor; La. R.S. 31:212.21 to 31:212.23 cover royalty owners other than the lessor and production-payment owners.
• The 2-year unclaimed property period is the current text of La. R.S. 9:154; its history line lists a later act not yet in effect, which this review did not check.

Sources

Last reviewed November 2, 2026.

• La. R.S. 31:137 - Nonpayment of royalties; notice prerequisite to judicial demand — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:138 - Required response of lessee to notice — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:138.1 - Division order; precedence of lease; penalties for failure to pay royalties due (as amended by Acts 2023, No. 88) — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:139 - Effect of payment in response to notice — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:140 - Effect of nonpayment in response to notice or failure to state cause therefor — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:141 - Dissolution not a favored remedy — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:210.1 - Interest on purchase payment of production — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:210.2 - Declaration of interest; when third party purchasers of oil may withhold payment — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:211 - Availability of mandamus for nonpayment of sums due for production — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:212.21 - Nonpayment of production payment or royalties (owners other than mineral lessor); notice prerequisite — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:212.23 - Effects of payment or nonpayment with or without stating reasonable cause — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:212.31 - Payment information to interest owners — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 31:212.32 - Accumulation of proceeds from production — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 30:10 - Agreements for drilling units; pooling (EXCERPT saved: A(4), A(3)(b)(ii)(dd), history; current through Acts 2025, No. 458) — Louisiana State Legislature, fetched November 2, 2026
• La. R.S. 9:154 - Presumptions of abandonment (Uniform Unclaimed Property Act; history line lists Acts 2026, No. 891, eff. Jan. 1, 2027) — Louisiana State Legislature, fetched November 2, 2026

Related guides

• Royalty payment law by state (comparison of the covered states)
• Louisiana mineral rights
• Suspended royalties: why you are not getting paid
• Division orders explained
• How to read a royalty statement
• Unclaimed mineral royalties

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