Eitt kvöld rekr hann fé langt fram á dalinn ok sezt niðr þar, sem hættir rekstrinum. 

One evening he is driving sheep far forward (?) in the valley and was sat down there, who ventured an annoyance. (makes no sense)

Sækir hann svefn mjök. 

A deep sleep overcomes him.

Kemr honum í hug, at þetta mun trauðliga sjálfrátt, stendr upp aftr ok hristir þetta af sér. 

He remembers, that this will scarcely (be) his own fault, stands back up and shakes this off him.

En sem hann litast um, sér hann, hvar fét kemr aftr hlaupandi með ysi ok þysi miklum. 

But as he looks about, he sees where the sheep come back jumping with much noise and uproar.

Rennr nú nokkut af Hrana ómegin, ok nú getr hann at líta, hvar einhver óvættr hleypr eftir fénu. 

Now the swoon passes away from Hrani, and he now gets to see where some evil spirit is chasing the sheep.

Nálgast nú þetta skjótt. 

This now rapidly approached.

Er þat at sjá tröllskessa ferlig. 

A monstrous troll-witch was to be seen.   (Z. vera 6: þar var at sjá, there was to be seen)

Stígr hún á í fyrir, en þjóhnappar berir. 

She steps forward (?), and/but naked buttocks.

Ok er hún kemr þar, sem Hrani var, staldrar hún við ok mælti: "Heill þú, Hrani hringr, ok muntu bíða mín."

And when she comes there, where Hrani was, she stops by (him) and said: "Greetings, Hrani "Ring," and you will wait for me (or "suffer me")

Hringr mælti: "Svo er víst, eða hvat heitir þú, eða hvar eru hýbýli þín?"

"Ring" said: "So it is wise/known, what is your name, where is your home?"

Hún segir: "At litlu kemr þér þat at vita. 

She says: "In a little while, you will come to know that.  (Text has present tense, but future seemed to work better in English.)

Ek heiti Nípa, ok erum vit systr þrjár ok vinnum fyrir föður okkar í kör. 

My name is Nipa, and we are three sisters and we work for our bedridden father.  

Er ek þeirra elzt, en móðir okkar er dauð. 

I am the oldest of the (sisters), and our mother is dead.

Atsetr eigum vit í Fljótsdal hér fram. 

We have a residence in Lake-valley forward (of) here (??).

Höfum vit verit þar tólf ár, ok mun mönnum víða nálægt hafa þótt sik vanta á haustum fé ok hross. 

We have lived there 12 years, and men will in many places close by have seemed to oneself to lack harvest sheep and horses.

Hefi ek nú sótt tvo smalamenn Helga króks, ok nú ætla ek at bæta þér við ok hafa til snæðu á morgun. 

I have now overcome two of Helgi "Hook's" sheperds, and I now intend to compensate you and have (snæðu = eat?) in the morning. 

Hefir þó föður minn illa dreymt til þín, ok held ek öfugt orðit fyrir honum um drauma, þar hann á nú fáar vikur eftir ólifat."

However, my father has dreamed poorly ("had a bad dream"?) about you, and I kept my harsh (?) word for him concerning the dream, there he now had few weeks (??) after death."

At því mæltu ræðr hún á Hrana, en hann nær hryggspennu yfir um hana undir höndum. 

At that she said she advises Hrani, and/but he nearly clasped his arms around her back over around (?) her under hands (??). 

Þrýsti hún þá svo fast at handleggjum hans ok búk öllum, ok varð hann nær aflvana fyrir henni. 

She presses so fast at his arms and all his body, and he became nearly overpowered by her.   (Z. aflavani - verða aflvani = to succumb, be over-powered)

Verst hann fyrir henni um hríð, en hún sækir at koma honum undir sik, ok nú hrekjast þau um bala nokkurn ok færast at steini einum, er þar stóð. 

He led (?) her for a while but she sought to overcome him, and now they were driven away (?) around a grassy bank somewhat and they were brought to a stone that stood there.

Þat finnr hann, at hún vill koma honum á steininn. 

He finds that, that she wants to make him come ("force him") to the stone.