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5 Factors Involved In Making The Decision To Sell Mineral Royalties

by Arnold Gomez

Have you recently been approached about selling mineral royalties? The United States is one of few countries that allows individuals and organizations to own minerals on land that they own. There are different levels of ownership, and many companies seek to purchase minerals from individuals and organizations with mineral rights. If you have considered selling your mineral rights, this list of considerations will help you make a wise decision.

1. Consider State Laws

Each state has its own laws surrounding the transfer of mineral rights, especially when it comes to mining and drilling. It is important to become acquainted with the laws in your state, which you can find out from a real estate agent or real estate lawyer in your area.

2. You want to maintain ownership of the surface property.

The surface property is still something you want to own, especially if you live or work on the property. Ensure that the company you sell mineral rights to understands this agreement, but also go one step further and speak with a lawyer about writing a contract that protects your ownership rights as well.

3. You must live with the consequences of the mineral extraction. 

This means that you will live, work on, or own property that may have employees and equipment on it for some determined period of time. If the rights were purchased as a reserve, you may not have much power about when this happens in the future. While selling mineral royalties and rights may be a smart financial move, this is certainly still something to consider.

4.  You can define what the rights buyers are allowed to do.

If you make a solid lease agreement, you may be able to define exactly what the company purchasing royalties is allowed to do with your land, which could include everything from open excavation to using large, loud equipment.

5. Once you deposit a draft, like a deposit, you are not allowed to negotiate.

Once you have been paid the deposit for your mineral royalties, negotiations are off the table. This is why it is so important to handle all this ahead of time, and of course make sure to read the fine print with a real estate agent and lawyer.

Ultimately, speaking with an expert in real estate can help you determine whether or not selling mineral royalties is the best option for you, your property, and your family. For more information, contact a business such as Appalachian Mineral Partners.

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