What to Know When Selling Your Oil and Gas Mineral Rights
If you are thinking about selling your oil and gas mineral rights, there are a few things you need to know about the process. You need to know your legal rights, and you need to know what minerals you are selling. If you have any questions, you should contact an attorney before you sign any paperwork. Here are a few more important things you should know about the process.
1. Know Your Minerals
The buyer will want to know more about the minerals that are underneath your property. Minerals are more than precious metals. Owning Texas mineral rights can include oil and gas production. Some minerals are only found in certain regions. You could have several minerals beneath your property. Research the area to find out what minerals are common in your town.
2. Understand the Legal Terms
You need to know if you own the land before you start looking for a buyer. If your deed has exclusions and limitations, you need to speak with a title examiner. The title examiner can verify your mineral ownership rights. Unfortunately, not all buyers are honest. If the offer sounds too good to be true, it might be a scam. Read the contract several times. If you have any questions, contact an attorney before signing any documents or cashing any checks.
3. Know What You Are Selling
You cannot own minerals until they are above the ground. You are selling the right to search and dig for minerals. Depending on the contract, you might be able to sell your rights when your lease expires. You might get paid royalties when the minerals are extracted, or you might get a lump sum payment from the buyer. Also, you should know the market value of your mineral rights. The market value will depend on the size of the mineral deposits. The size of the property is also an important factor. You should know the current commodity prices.
4. Understand Your Surface Rights
You will still have some ownership after you sell your mineral rights. When the sale is finalized, you will still own the surface. Someone else will own the rights to the minerals underneath the surface. You will have a few legal protections when the contract is finalized, but you should consider including additional protection clauses in your contract.
5. Know Your Limits
You might make a lot of money when you sell your mineral rights, but you should be aware of your limits. Are you comfortable with the extraction methods? Can you tolerate the noise? If you are unhappy about anything, you should talk with an oil and gas lawyer during the negotiation process.
If you decide to navigate the process without the help of an expert, you will be taking a big risk. An expert will help you avoid unscrupulous buyers. The expert will also help you protect your interests.
