Practice Test Geeks(CMA) Certified Minerals Appraiser Practice Test
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CMA Lease & Contract Analysis Flashcards

6 cards from real CMA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 6 CMA Lease & Contract Analysis flashcards as text

  1. Which lease clause allows a lessee to maintain the lease beyond the primary term if production is occurring in paying quantities?

    Answer: Habendum clause

    The habendum clause defines the lease's duration, including the condition that production in paying quantities extends the lease beyond the primary term.

  2. A minerals appraiser reviewing a lease finds it contains a 'Pugh clause.' What does this clause primarily accomplish?

    Answer: It releases acreage not held by production from the lease

    A Pugh clause releases non-producing acreage or formations from the lease at the end of the primary term, preventing a single well from holding an entire large tract.

  3. What is the standard minimum royalty rate in a US oil and gas lease on private lands?

    Answer: 1/8 (12.5%)

    The traditional minimum royalty on private US mineral leases is 1/8 (12.5%), though modern leases often negotiate higher rates.

  4. In a mineral lease, which clause typically grants the lessee the right to use surface resources such as water for operations?

    Answer: Granting clause

    The granting clause defines what rights are conveyed to the lessee, and in many leases this includes ancillary surface rights needed for operations.

  5. What does a 'shut-in royalty' provision in a mineral lease allow?

    Answer: The lessee to hold the lease by paying a nominal royalty when a gas well cannot market its production

    A shut-in royalty clause allows a lessee to maintain a lease by paying a small nominal royalty when a completed gas well has no market for its production.

  6. Which type of lease clause determines how royalties are calculated—at the wellhead versus at a downstream point?

    Answer: Royalty clause

    The royalty clause specifies the royalty rate and methodology for calculation, which directly determines whether post-production costs are deducted.