The topic of mineral rights is a pretty hot one right now especially given the growing support for more companies to buy up rights in Texas in order to seek out the natural gas and oil down there. It is also something which you guys have been asking us about in recent weeks following our article on where to invest your money. We didn’t go into a great amount of depth in that last piece which is why we have got my good friend Trent on board, who worked for minerals acquisition company Ferrari Energy for many years and who is also an expert when it comes to this type of investment. If you have been wondering about mineral rights then hopefully this will clear up some of your questions.
What Are Mineral Rights?
Mineral rights are the ownership of what is beneath a certain plot of land, they can be bought and sold and only the owners of these rights is allowed to dig beneath and see what is down there. Some large scale companies like those who operate within fracking and the oil industry have technology which allows them to scan beneath the surface in order to see what is down there and whether or not there is any benefit to them acquiring certain land.
Do I Own The Mineral Rights Beneath My Home?
In most cases you probably do not own the mineral rights beneath your home, most mineral rights which have not previously been acquired are owned by the government. Any company or individuals who wish to obtain mineral rights in order to mine beneath the surface will have to make an agreement with the government, which will usually see them paying a small percentage of what they find back to the treasury. In some cases a previous owner may have acquired rights to your mineral beneath the land and sold it when they sold the land to you, but there is no guarantee that because you own the land, that you also own what is beneath it.
What Are Surface Rights?
Surface rights are what we have just alluded to and this is what all land owners have. The surface is defined by what you are able to do on and above the area of your land. Whilst digging into the land is alright if you need to lay foundations or install structures, there are no rights which allow you to obtain anything of value found beneath the land if you are only a surface land owner.
What Are The Costs ?
The cost of mineral rights has been rising sharply and the price currently sits at $40,000 per acre of mineral rights. As mentioned if there is anything underneath of value then the gogtvnemnt will also expect an agreed percentage in return. If the mineral rights are bought from someone who privately owns them then the price will be negotiable.