So, what are mineral rights? They are the rights that apply to anything below the surface of the soil. Beneath what you can see, the land is rich in all sorts of minerals and commodities that are mine-worthy. That may include oil, coal, natural gas, etc. The one significant benefit associated with investing in mineral rights is that you will have the authority to voice your opinion about what happens to these underground resources of Mother Nature on your property.

However, you must consider the complexities involved in the procedures of purchasing of mineral rights, as well as the environmental impacts of mining.

Following are three steps that cannot be overlooked before investing in mineral rights.

EXTENSIVE RESEARCH ON MINERAL RIGHTS

Look up the Availability of Purchase.

States normally keep records of mineral rights ownership in a separate deed book for surface rights. Therefore, in order to know who has the mineral rights ownership for a specific property, you need to visit the local courthouse. Appoint an attorney who can look up whether the mineral rights of the land for which you have already bought the surface rights are sold or not due to the high mineral potential of the area.

Which are the Lucrative Minerals?

In the U.S., gas and oil are abundant. States like Oklahoma, Alaska, New Mexico, North Dakota, Colorado, California, Louisiana, Utah, Texas and Wyoming contain 80 percent of the total gas and oil reserves in the U.S. Lithium (used in electronics that run on battery) is predicted to become extremely lucrative soon.

Check Whether the Locale is Actually a Deposit of the Mineral.

Gravel and sand are not minerals according to the U.S. Supreme Court. The commodity or material underneath the land you purchase must be determined as a mineral according to the federal government.

Find Minerals for Sale and Learn the Laws That Rule These Rights.

The mining rules of every state are different, thus impacting the sales of surface and mineral rights. The bases of the laws are similar only with minor variations. Having said that, the variations of these laws between different states can also be great.

You also need to find out the mineral rights that are up for sale throughout the U.S. Some websites provide this list.

BUY THE MINERAL RIGHTS

Coming to a negotiation with the terms of the sale involves particular agreement terms along with the price paid for rights. The terms of the agreement may vary from the property’s legal description, access method of the property, steps for damage control, certain minerals that you wish to extract, etc. Mostly, buyers make the call about mining processes. The seller has to be certain of what can go wrong and accordingly take control of the onset of the mining processes.
Before finalizing the deal by signing the papers, you must understand the depths of the terms and conditions that have been set forth. Consult an attorney who can help you with this crucial aspect of negotiation for buying mineral rights, as an expertise in transfer and sale is required.
There are many who take these rights on lease rather than directly buying them. If you are one of these people, know for sure that the lease agreement is going to have even more terms. An experienced mineral rights leasing attorney can inform you that certain states have laws that require drilling companies to pay the property owners a minimum royalty percentage.

HOW TO MAKE MONEY BY PURCHASING MINERAL RIGHTS

Identify the positive points of both buying and leasing the mineral rights of property. In the case of a lease, you need to start the drilling way ahead of time so that you can reap the benefits of mineral extraction before the lease expires. Otherwise, you will end up passing your mineral rights back to the owner before you receive the maximum possible income from them.
Purchase as a speculator so that you can enjoy the benefits by reselling the mineral rights to another company to do the actual mineral extraction.
Leasing is always better than purchasing, as it is cost effective and helps you test how lucrative the property actually is before you buy it for good.
Get yourself acquainted with the federal laws of drilling and mining activities.

For clarification: Owning surface rights (ownership of things above the ground) doesn’t necessarily make you applicable for mineral rights. The two rights are different entities that can be sold together or separately. Plus, you needn’t buy the land if you buy both these rights together Ten31 Minerals, LLC has a unique apporoach to Oil and Gas Minerals for all traditional Real Estate Owners. We Offer 1031 exchange buyers a platform to mineral ownership. Feel free to contact us at (405)418-8223.

Coming to a negotiation with the terms of the sale involves particular agreement terms along with the price paid for rights. The terms of the agreement may vary from the property’s legal description, access method of the property, steps for damage control, certain minerals that you wish to extract, etc. Mostly, buyers make the call about mining processes. The seller has to be certain of what can go wrong and accordingly take control of the onset of the mining processes.
Before finalizing the deal by signing the papers, you must understand the depths of the terms and conditions that have been set forth. Consult an attorney who can help you with this crucial aspect of negotiation for buying mineral rights, as an expertise in transfer and sale is required.
There are many who take these rights on lease rather than directly buying them. If you are one of these people, know for sure that the lease agreement is going to have even more terms. An experienced mineral rights leasing attorney can inform you that certain states have laws that require drilling companies to pay the property owners a minimum royalty percentage.

Important Steps To Follow Before Investing in Mineral Rights