Monthly Archives: March 2017
If you own property, then you know that you have the option to lease or sell the mineral rights of that piece of land. This can be beneficial for anyone that owns property in an area where deposits of oil or natural gas can be found.
Property owners have a few options when it comes to mineral rights. They can maintain their ownership and try to strike it rich on their own, or they can sell their rights to oil and gas royalty companies that will pay for their mineral rights. Here are some of the benefits you may see when you sell oil and gas rights instead of taking a chance on royalty payments.
Receiving a Lump-Sum Payment
Instead of getting royalty payments every quarter, selling your mineral rights can provide you with a lump-sum payment. For many families, this can be much more convenient than waiting for money to start dripping in–if it ever does. With selling your rights, you can be guaranteed a certain amount of money whether the land produces any oil and gas or not.
Eliminate the Risk of Ownership
Owning mineral rights that have the potential to produce oil and gas can be a big risk for some. With ownership, you have to work hard to determine the amount of fossil fuel deposits on your land and figure out the best way to extract them. Often that entails getting a lot of people and companies involved in the process. It can be complicated and can leave you without a hefty profit you’ve dreamed of. If you sell the rights, you can get money upfront and let someone else take on the risk of ownership.
Better Manage a Future Inheritance
Mineral rights can be included in what you want to leave your family after you have passed, but these rights are not easy to divide between heirs. When mineral rights are inherited by a number of family members, all of the heirs must agree on what to do with the land and the rights. Selling these rights beforehand can provide heirs cash instead of mineral rights, which can be easily divided, leaving your family the legacy it deserves.