Mineral Rights Buyer

A. First it is important to ask if you are dealing with a direct buyer with cash on hand to close your deal, a broker, someone who may flip your mineral rights to another buyer, or a company that specializes in taking a fee or percentage for adding value to your deal that you would not otherwise have. Legitimacy should mean that the person or company has registered with the State, can deliver on their contracts, has references if needed.

– Hedge Funds or Private Equity Groups: This level of buying is done by an institutional level investment managers that often are managing money for others.

– Mineral Buying Companies: These companies are formed to target mineral rights or oil and gas royalties for investment, may hold those investments, or may be buying to sell them at a later date.

– High Net Worth Individuals: These would be wealthy persons that buy mineral rights, and invest in the oil and gas sector.

A. Find a legitimate buyer as discussed above, have them take time to help you understand their process, the valuation of your minerals, their offer, the terms of the contract, and how long it will take to close. Make sure that they provide you with title work on how much mineral acreage you own. Be clear on your closing details, payment options, security, and time frames.

A. By filing a properly drafted deed, document, Trust, or Probate of record in the County Clerk’s office of that particular county’s seat and courthouse. This document or deed will need to be reviewed or drafted by someone with the expertise in mineral title and law. A Petroleum landman or Title Attorney are the most qualified to draft the documents correctly. We can assist in helping you with all of this.

A. The short answer is yes. Mineral Rights or sub-surface rights are actually considered a Tangible Asset in Oklahoma. However, the mineral rights are not regulated at the same level as Real Estate in Oklahoma. The exception would be any mineral rights owned by Native Americans in Tribal Lands. Those Tribal Lands are strenuously regulated by the Bureau or Indian Affairs under the United States Department of the Interior.

A. All mineral rights have some relative value based on their commercial application and desirability in a given industry or sector of public use. Minerals have various applications in manufacturing or for energy.

Like all other mineral rights, Oil and Gas Mineral Right’s worth is relative to the leasing and drilling activity on or near your location, and that is dependent on the geological formations containing oil and gas that can be recovered economically. The greater the production of oil and gas, the greater the value your minerals will have at that time.

A. Oil and Gas Royalties are worth a multiple of what they produce every month, or a percentage of the estimated recoverable oil and gas in reserve in producing formations under the ground. Ultimately, the terms of the Oil and Gas Lease, it’s royalty percentage, the driller, the operator of the well, commodities prices, and the overall market conditions are the major variables affecting your oil and gas royalties worth.

A. The oil and gas royalties last as long as the life of the well. The life of the well depends on the type of the well (conventional vertical or horizontal well), the type of reservoir, the geological formation, depth, the regulations of the Oklahoma Corporation Commission, completion techniques, well management, Oklahoma Statutes, and the specific terms of the oil and gas lease currently held by that production. The life of a conventional well could range from 20 years to 70 years or more. Horizontal wells have been estimated to produce with a life span from 20 to 30 years at lower and lower production rates. A well must be considered in “commercial production” in order to continue to be legally holding mineral rights. Simply put, this means that a well must be producing more revenue than it costs to operate that well.

A. It is possible that mineral rights came with your surface estate, but the best way to make that determination is to have a title search done specifically with mineral rights in mind. The best place to begin is to look for reservations of the mineral rights in your property’s abstract. Are you getting royalty payments? Have you been sent offers to sign an oil and gas lease? Have you received offer letters or gotten phone call proposals to sell? These would be some indication that you might own mineral rights, but not a guarantee.

A. The transfer of your mineral rights to the next generation are taxable under certain circumstances. A probated will with a Judge’s Final Decree, transfer on death deed, or family transfer deed can result in a tax, but some individuals find that forming a family trust solves that problem. We suggest that any serious planning be done with the counsel of a trusted estate planner, or C.P.A. before making such decisions final.

A. A Probate proceeding can be avoided by transferring your mineral rights prior to death using a number of differently styled mineral deeds, or a trust could be formed which would then be transferred ownership of your mineral rights. The trust you form would continue in existence after death, and your designated successor trustee or trustees would manage those assets according to the trust agreement. Consulting a trusted and competent attorney will provide the best results in deciding what your best option may be.

A. Surface rights are rights to the Real Estate or the land on which a person lives, farms, hunts, fishes, or generally enjoys. The surface estate usually includes the property, above ground resources like ponds, streams, water, vegetation, and trees. Surface rights will also include the structures on the property. This also includes the right to drill a water well and ad septic systems and other storage tanks with the proper permitting.