The demand for commodities such as oil and gas is increasing and a myriad of energy and mining companies are on the lookout for land and properties possessing minerals. With energy and mining companies seeking mineral rights owners, mineral rights leasing is undeniably emerging as a growing trend in the real estate market and energy/mining industry.
The concept of mineral rights in Texas came into being when Texas was under Spain and Mexico and thereafter, under the state of Texas. During the early days, before 1866, property owners did not enjoy mineral rights. It was only consequent to the formulation of the state constitutions of 1866, 1869 and 1876 that the property owner was entitled to mineral rights associated with his property. Thereafter, the law came into retrospective effect as well. In 1919, owing to the Relinquishment Act, the owner became an agent of the state of Texas in leasing his land. The proceeds of both leasing and production were thereafter shared by the owner and the state. Currently, the law permits the owner to sever his property rights from mineral rights and sell, bequeath, gift or lease his mineral rights independently. The law also permits their separate sale or transfer, besides leasing them for commercial exploitation.
Technically, oil, gas and coal are minerals, as are metals and their ores, and non metals like gypsum. Even sand, stone, gravel, peat and marl fall under the category of minerals. Today, the owner is entitled to lease his mineral rights for a bonus value and also enjoy a 1/6th share of the production amount in what is known as royalty. Texas gas royalty could vary from ΒΌ to 1/32. Texas mineral rights could yield very high royalties but this would depend on the mineral type and quality, in addition to the richness of the deposit.
Before leasing mineral rights, it is essential to assess the potential of the minerals you possess. Here, the local geologist can help you ascertain not only the types of minerals present on your property but also their likely yield and the quality of their output. He can guide you regarding the quantum of bonus and royalty obtainable in your vicinity.
