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What Exactly Are Mineral Rights Royalties?

Updated: Feb 26, 2020

Mineral Rights Royalties oil rig

Did you know that in many countries, the government owns all mineral rights, or anything that comes out of the ground? Well in the United States, including Texas, this isn’t the case, in fact, whatever comes out of your ground is yours! This is what mineral rights are, your right to your minerals. And mineral rights royalties are the money you get for selling the minerals that come from your land.

Seem simple? Well, there’s a lot that goes into royalties, and many different kinds of mineral rights to begin with.

In our latest article you will learn about:

● Mineral rights in America

● Mineral rights royalties

● Types of mineral rights

● And more!

Mineral Rights in America

America is one of the few countries where the landowner owns not only the surface of their land, but all the way down too, which includes anything extracted from the land.

Mineral resources and rights are given to whatever individual or organization owns the surface of the land, which means that though there are both ‘surface rights’ and ‘mineral rights’, the owner of the surface owns the mineral rights as well. This complete ownership is known as a ‘fee simple estate’ in America.

Fee simple is an easy type of ownership, as the owner controls the surface, the ground beneath (subsurface) and the air above their property. The owner also has the freedom to sell, lease, gift or give after death these rights to others.

But what if you want the surface (like where your home or farm is) but no longer want the mineral rights, or don’t have the ability to do anything with the mineral rights your land houses?

That is where mineral rights royalties come into play!

Mineral Rights Royalties

If you aren’t using your mineral rights and resources, then you’re missing out! But it can be a lot of work to get your minerals, oil, and gas out of your land, and most people don’t have that capability. That is why mineral rights royalties came into existence.

Let’s say you have oil beneath your property - there is a booming market for oil! But you don’t have a drill, the knowledge or desire to get it out of your land and sell it yourself. What you can do is allow an oil drilling company to come onto your land and take the oil. They will then pay you for every barrel of oil they extract from your land, because remember, you don’t just own your land’s surface in America, but the mineral rights as well.

And though this process works well for some, or for a time, the taxes, trickle income, and paperwork can be a headache each and every year. That is why many people choose to get a lump sum, or sell their oil and mineral rights instead of getting small royalties every month or quarter.

Types of Mineral Rights

● Coal - this is mainly found in the Midwest, the Appalachian region, the Gulf Coast region, and out West.

● Copper - often found in Arizona, Utah, New Mexico, Montana, and Nevada.

● Iron - common in Michigan, Minnesota, and Utah.

● Natural gas - found in the Appalachian region, Arkansas, Colorado, Louisiana, Montana, Nebraska, New York, North Dakota, Ohio, Oklahoma, Pennsylvania, South Dakota, Texas, West Virginia and Wyoming.

● Oil - most commonly found in Alaska, California, Colorado, Louisiana, New Mexico, North Dakota, Oklahoma, Utah, Texas, and Wyoming.

Want to Learn More About Mineral Rights Royalties, Your Land, & Your Rights? Contact Clear Fork Royalty!

If you would like to learn more about your surface rights, mineral rights, or mineral rights royalties - contact Clear Fork Royalty! We are experts in all things mineral, oil, and gas rights!

Whether you want to sell your mineral rights or keep getting monthly royalties, we can help you learn more about your options, benefits, and pitfalls of each!

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