Finding out that you now own mineral rights can put you in a wonderful position to capitalize or make money from these resources. However, it can be confusing to know where to start or figure out what to do next. One of the most common questions we run into at Master Mineral Holdings is around mineral ownership. There are four main types of mineral ownership and they all mean something different. Our team at Master Mineral is dedicated to helping you.
The Main Types of Mineral Ownership
1. Mineral Interest
At a high level, having a mineral interest simply means that you own the oil and gas rights beneath the surface. Depending on the stage of production, some people may call this an oil interest or a gas interest. The amount of a mineral interest you own is typically expressed as the net mineral acres owned.
2. Royalty Interest
A royalty interest occurs when minerals are leased. When the property owner enters into and agreement with another party, the original owner retains a royalty interest which entitles them to a share of the revenue generated from the oil and gas produced. This type of ownership bears no costs for production.
3. Overriding Royalty Interest
To put it simply, an overriding royalty interest means that you do not actually own any of the net mineral acres or any of the actual oil and gas. However, you do own a portion of the revenue generated from oil and gas production.
4. Executive Mineral Interest
The executive right in mineral ownership gives you the ability to negotiate and execute oil and gas leases and lease bonuses. It’s also your duty to negotiate a fair and equal price for non-participating royalty owners and receive lease bonuses. However, the executive mineral interest owner does not receive royalty checks.
Contact Master Mineral to Learn More
Master Mineral Holdings has an expert team of oil and gas professionals to help you navigate the subtleties and nuances of the oil and gas industry. From determining your type of mineral ownership all the way to signing a final purchase offer, you can count on us. Having served hundreds of families for more than 10 years, we have proven ourselves with a trustworthy track record in the mineral buying industry.