jja79 said:

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My comment not to sell mineral rights was based on my experience only. I had no idea I was heir to mineral rights until a producer contacted me 49 years after they were acquired. I get calls at least monthly to sell the producing interest and the offers are laughable to me.

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Now multiply that by 6 or 700 people and see what a mess you have. There is no way to ever clear it up. The end result? All of those royalties end up going to the state. So the 'muh rights' people here should be in favor of some limit, to prevent the evil state from getting that money.

There should be a point where it all reverts back to the surface owner.

FILO505 said:

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Leon County, 100 acres raw

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This goes straight to my original curiosity. Not having drilled or had a seismic survey doesn't necessarily prevent knowing what's there. I'm not a geologist and am long removed from involvement in any E&P operations, but I find it hard to believe that a tract of this size is large enough to obscure from the professional geologists what lies beneath based on the data they have.

Barring future technological developments or economic realities, this tract may not have profitably recoverable minerals. Or the ownership has turned down the offers and may have suffered mineral drain (not the right tech/legal term) to adjacent interests, recoverable or otherwise.

Also depends on where in Leon County.

I have 0.00041% interest in the lease covering the miniscule property I have an interest in. It took them years but they were able to secure leases from most of the owners. I believe if I understood correctly the other money is held while they continue to search for the others.

BoerneGator said:

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Quote:

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I get calls at least monthly to sell the producing interest and the offers are laughable to me.

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Precisely! They're not serious, but intended to prey upon the old, ignorant, and unaware, or druggie type who wants/needs quick cash to feed a habit. Same for real estate solicitations.

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The worst are the ones with preprinted checks that they send to elderly to try to trick them into cashing them in exchange for the rights. I constantly had to shred the ones sent to my grandmother in fear of them preying on her aging mind.
Usually they are like 2-5k but back in the hey day before 2014 oil crash I saw some for 100k 150k, 200k and last one was 240k for rights on a 23 acre place. The guy who was getting them never deposited them and ending up dying in the past year so now his heirs still have 100% of the rights.

I would advise keeping some but selling maybe half of what they have

84AGEC said:

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I would advise keeping some but selling maybe half of what they have

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Don't relinquish the Executive Rights. This allows you to negotiate leases (most important) and receive cash bonuses.

BoerneGator said:

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84AGEC said:

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I would advise keeping some but selling maybe half of what they have

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Don't relinquish the Executive Rights. This allows you to negotiate leases (most important) and receive cash bonuses.

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Anyone who buys land and allows the seller to retain executive rights is an absolute fool.

Check that. Anyone who buys land and allows the seller to retain ANY mineral rights is fool. Royalty? Maybe, but never minerals.

Martin Cash said:

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BoerneGator said:

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Martin Cash said:

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eric76 said:

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Martin Cash said:

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It should be illegal to reserve any mineral or royalty interest for longer than a set period of time, say 20 years. If you want the milk, keep the cow.

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Do you think that the government should get what the owner does not use of his own possessions?

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I have no clue what that means. Who said anything about the government getting anything?

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Why not start by justifying your suggestion regarding mineral owners losing their property after a term? Who would implement such an unconstitutional act other than government, pray tell? The local Chamber of Commerce perhaps? And regarding the term, what about 75 or 100 years? Or why not forever minus twenty? That's a term.

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Most states already have this law. At the end of the maximum retention period, all minerals revert back to the surface owner, where they should be. I was just involved in a case where an oil company interplead $1,8 million in unpaid royalties. They belong to hundreds of unidentified owners, because someone reserved part of the minerals over a hundred years ago. It is impossible to identify the owners. End result, the tax authorities got a small slice of the pie, and the state unclaimed property fund got the rest of it.

My person opinion is that if you buy the land, you get it all.

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There is one state in which nobody gets the mineral rights -- Hawaii.

JJxvi said:

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BoerneGator said:

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My person opinion is that if you buy the land, you get it all.

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Your example probably involves mostly tiny interests. If the "owners" don't have enough concern to "keep up" with and/or claim their property, then they don't really own it in the first place. They just have a claim to it.

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Is there a way for someone to take ownership of unclaimed interests, or nobody owns it anymore til the end of time?

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There was one case I can think of in which someone took ownership of claimed mineral rights.

It had to do with adverse possession.

In that case, the owner had been in not real good health and hadn't checked his land holdings in years. During that time, one farmer started farming one field of his. Around here, that would probably have been a section.

When the owner passed away, he gave the land to a charity. The charity started collecting the oil royalties. When they found out that the property was being farmed by a local farmer, they tried to force him off but he claimed that it was his by adverse possession. It went to trial.

The jury in the trial court agreed that the local farmer had, indeed, taken it by adverse possession. What was surprising to me was that since the mineral rights had never been severed from the surface rights, the mineral rights followed the surface rights and the local farmer ended up with those as well.

jja79 said:

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My comment not to sell mineral rights was based on my experience only. I had no idea I was heir to mineral rights until a producer contacted me 49 years after they were acquired. I get calls at least monthly to sell the producing interest and the offers are laughable to me.

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We get those, too.

A few weeks ago, we got one from someone wanting to buy the farmland itself at rock bottom prices.

Martin Cash said:

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BoerneGator said:

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84AGEC said:

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I would advise keeping some but selling maybe half of what they have

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Don't relinquish the Executive Rights. This allows you to negotiate leases (most important) and receive cash bonuses.

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Anyone who buys land and allows the seller to retain executive rights is an absolute fool.

Check that. Anyone who buys land and allows the seller to retain ANY mineral rights is fool. Royalty? Maybe, but never minerals.

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Well now, that's not bad advice, generally, but there are no doubt exceptions. Small acreage, great price, no production history and great location just might qualify as exceptions to your "rule"... YMMV

eric76 said:

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Martin Cash said:

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BoerneGator said:

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Martin Cash said:

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eric76 said:

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Martin Cash said:

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It should be illegal to reserve any mineral or royalty interest for longer than a set period of time, say 20 years. If you want the milk, keep the cow.

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Do you think that the government should get what the owner does not use of his own possessions?

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I have no clue what that means. Who said anything about the government getting anything?

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Why not start by justifying your suggestion regarding mineral owners losing their property after a term? Who would implement such an unconstitutional act other than government, pray tell? The local Chamber of Commerce perhaps? And regarding the term, what about 75 or 100 years? Or why not forever minus twenty? That's a term.

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Most states already have this law. At the end of the maximum retention period, all minerals revert back to the surface owner, where they should be. I was just involved in a case where an oil company interplead $1,8 million in unpaid royalties. They belong to hundreds of unidentified owners, because someone reserved part of the minerals over a hundred years ago. It is impossible to identify the owners. End result, the tax authorities got a small slice of the pie, and the state unclaimed property fund got the rest of it.

My person opinion is that if you buy the land, you get it all.

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There is one state in which nobody gets the mineral rights -- Hawaii.

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This was the case in Texas until the Republicans (the Union) showed up with an army and wrote us a new Constitution in 1866.

FILO505 said:

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Clients selling a somewhat decent sized property in Texas. Completely unknown and untouched due to the time span the property has been in the family. They own the mineral rights and are willing to sell them (negotiable outside of list), which is their choice. How do I gently tell them that selling mineral rights is completely insane?

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This thread has some really bad legal takes. Be careful.

Severed surface and minerals are not uncommon in producing states. Unproductive counties yes, but ask all the developers who didn't reserve the minerals in the Barnett Shale in 80s and 90s how much they'd have made had they reserved the minerals before developing and selling the lands. New discoveries and technologies can still happen.

For the seller's best interest, they should either price the minerals into the transaction or reserve them to keep or sell to another party later. There can be fact exceptions such as the sellers best interest is to sell at a discount (not valuing the minerals) because of xyz. But, to say it is insane to reserve the minerals without xyz existing, does not necessarily sound like the best interest of the seller.

Valuing unproductive minerals in an unproductive area is subjective and opinions are as varied as the advice on this thread.

FILO505 said:

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North side of Normangee

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Do you k ow what they are looking at selling the land for? We have been potentially looking that way to get out if Brazos/Bryan zoned schools.

Martin Cash said:

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BoerneGator said:

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84AGEC said:

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I would advise keeping some but selling maybe half of what they have

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Don't relinquish the Executive Rights. This allows you to negotiate leases (most important) and receive cash bonuses.

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Anyone who buys land and allows the seller to retain executive rights is an absolute fool.

Check that. Anyone who buys land and allows the seller to retain ANY mineral rights is fool. Royalty? Maybe, but never minerals.

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BTW, I recently sold 5+ acres to a developer next to me to add to their much larger development. I failed to reserve the minerals in the original contract, but when I realized my mistake and brought it to their attention. they relented without issue for closing. This is in Bexar County. It'll likely never matter, but it just might someday to my grandchildren...who knows? Minerals extend beyond oil and gas.