Cautions before selling mineral rights

Posted on Thursday, January 5th, 2017 at 2:10 pm    

The world of mineral rights is highly marketable, which is one of the reasons companies work hard in the hunt of profitable mineral resources. If you are looking to sell your mineral rights, you may want to consider the following cautions listed by SF Gate:

  • Future Value – Since mineral resources produce a lot of money, consider first the future of your mineral properties. There may come a time when its value exceeds normal expectation after you sell the rights, and you may not be the one reaping benefits.
  • Estate Planning – Mineral rights and properties may be a great monetary source for future generations. If you sell the rights, your family will not be able to benefit from future production.
  • Property Damages – Production of mineral properties often require heavy machinery and equipment. These barriers may interfere with other purposes you could have for your land, since you do not own the mineral rights anymore. When you retain mineral rights, you have sole control of your land.

If you are looking to enter the complicated world of mineral rights, please consult with our lawyers at The Mineral Auction. Call our Austin office at (512) 698-2802 to learn more about our practice.

How oil operators deal with mineral owners

Posted on Thursday, June 9th, 2016 at 9:01 pm    

In order to sustain the oil and gas supply needs of consumers, oil companies secure a legal contract under an “Oil, Gas, and Mineral Lease,” which allows them to tap into the rich mineral resources beneath the land of a mineral rights owner.

Under such a contract, oil companies or operators pay mineral owners for allowing them to tap into their mineral resources and mineral owners who strike a deal with oil companies automatically receive a lease bonus. Mineral rights owners under certain contracts are entitled to get an additional payment from oil companies in the form of a royalty percentage upon conducting any mineral-related activities, such as drilling. Oil companies initially make a proposal to notify the landowner and pay them before conducting any drilling activities, which may last from several days to several months.

If you are a mineral rights owner and you are planning to lease or sell your estate in the Austin area, The Mineral Auction professional team may be able to help you sell your mineral rights. Call our office at (512) 698-2802 to discover how we could help you find potential buyers.

Parsley Energy announces mineral rights acquisition

Posted on Wednesday, June 1st, 2016 at 6:03 pm    

On May 23,2016, Parsley Energy, an independent oil and natural gas company based in Austin, Texas entered into an agreement to acquire approximately 30,000 acres of mineral rights in Pecos and Reeves Counties for $280.5 million. The Southern Delaware Basin deal will cost the company $280.5 million in cash and is expected to close by July 14, 2016.

The company intends to finance the acquisition by debt and equity issuance. “Increasing netbacks per barrel of oil equivalent with no incremental capital expenditures or operating expenses elevates the return profile on the associated acreage, making it among the most compelling in our corporate portfolio,” stated Bryan Sheffield, CEO of Parsley Energy. The company has filed a registration statement (including a prospectus) with the SEC for the equity offering.

If you are looking to sell your mineral rights, the team at The Mineral Auction can help you work with some of the best and most reputable people in the business. Call today at (512) 698-2802 and you can rest assured knowing that your finances and assets are in great hands.

Tips for first time mineral rights owners

Posted on Friday, April 1st, 2016 at 2:00 pm    

Like any other business, it is important for first time mineral rights owners to have an understanding of what to expect from this ownership. This is especially true if an individual is looking to sell their mineral rights, as the marketplace can be incredibly complicated.

Interestingly, according to the Texas Landowners Association, it is not uncommon for land owners to have no idea that they are sitting on mineral rights until they are approached by a prospective buyer. So, for those who are new to the mineral rights world, the Texas Landowners Association offers the following, helpful tips:

  • Understand whether you are looking to sell OR lease your mineral rights, as these processes and outcomes are very different for mineral rights owners.
  • Never forget to negotiate when you are given an offer. Chances are your property has great value, which you stand to greatly profit from if you negotiate properly.
  • Understand market value. In the mineral rights industry, it is hard to determine the full value of your property. The best course of action is to introduce your property to many different buyers and have them compete, driving up the price of your mineral rights.
  • Determine the best time to sell or lease your mineral rights. Do not be blindsided by instant offers. Take your time and assess the situation.

At The Mineral Auction, we take the confusion out of the mineral rights selling process by putting your rights up at auction in front of our network of thousands of qualified buyers. Find out how we can help you get the best price for your mineral rights by calling us today at (512) 698-2802.

Understanding the Different Types of Ownership

Posted on Monday, February 1st, 2016 at 5:22 pm    

According to Mineral Rights Coach, there are four types of mineral rights ownership. For your convenience and understanding, we have covered them here.

The first is mineral interest. Typically, a mineral interest owner is entitled to enter and exit the property. This owner may also be able to reasonably use the surface for conducting exploratory operations as well as producing and drilling for oil and gas.

The second is royalty interest. This happens when the mineral rights are leased, this type of owner is considered to hold a non-working interest. It often involves an owner who obtains a share after a lease agreement with another party has been signed.

The third is working interest. This type of ownership occurs when the property is leased, and the owner is responsible for all of the drilling, operation, development, and exploration of the property. The revenue share for this ownership is the amount left after taking out royalty interest and other non-working interest shares.

The fourth and final is overriding royalty interests. This involves the acquisition of a portion of the revenues from oil and gas production, and it is free of production costs. The ownership expires as soon as the lease is abandoned at the end of production.

If you are considering selling or leasing your mineral rights in Austin, you can consult with our team of professionals at The Mineral Auction to get a better understanding of your options. Contact us today at (512) 698-2802.

Tips for Mineral Owners

Posted on Sunday, January 24th, 2016 at 4:12 pm    

Learning about the market and how to sell mineral rights may be overwhelming, especially to a first-time mineral rights owner. That’s why the US Mineral Exchange sought to help mineral owners obtain the maximum value for their property by providing the following tips:

  • Provide all documentation
  • Steer clear of common mistakes
  • Learn the basics of mineral rights value
  • Understand the market value
  • Know that  only selling half of your mineral rights is an option
  • Never take the first offer, and study the offers well before deciding
  • Do not take unsolicited offers to sell your mineral rights
  • Get help from professionals
  • Option agreements are usually red flags

Owners, especially those who are new in the industry, may benefit from the years of experience and expertise our team of professionals can offer. If you are looking to sell your mineral rights, consult with The Mineral Auction team before making any major decisions. We understand the complexity of the world of mineral rights, and we want to help you get the best deal possible for your property. Call our Austin office at (512) 698-2802 today.

Your Rights as a Mineral Estate Owner

Posted on Monday, January 4th, 2016 at 5:54 pm    

America’s policies regarding mineral rights favor the property owners by giving them the right to do what they will with the resources on their land. This has been great for Texas land owners, as our state has had a rich history of mineral production since 1869. Approximately two thirds of Texas actively produces oil, and the state actually produced about 35% of the country’s overall oil output in 2013.

When a new reserve of minerals is discovered on land in Texas, the current owner of that land automatically comes into possession of the full rights to all the minerals that may be found there. Only in instances where previous property owners retained surface or mineral rights will a current owner not be given possession of these rights. Records of mineral right ownership are kept in local county clerk’s offices and available to all upon request.

There have also been many cases where landowners were not aware that minerals existed on their property until oil and gas companies brought it to their attention with inquiries and monetary offers.

If you are looking to sell your mineral rights in Texas, the professionals at The Mineral Auction can help you find buyers and secure the best deal available. Call us at (512) 698-2802 today to learn more.

The Varying Values of Mineral Rights For Sale

Posted on Tuesday, December 22nd, 2015 at 2:04 pm    

In a recent article from MineralWise, the author compared the process of estimating the value of minerals to meteorologists predicting the weather, saying that both are subject to a number of factors and can vary widely.

Firstly, mineral rights vary by location. The value of minerals on your land will be higher if those minerals are located close to build-ups of hydrocarbon underground. Geology can vary greatly from region to region, and even from small areas; therefore, a big part of finding high-value minerals on your property is luck.

Another factor in the value of your mineral rights will be the size or amount of minerals on your land. Companies will naturally be more inclined to spend higher amounts on larger caches of product. This, again, is almost entirely up to luck.

A third aspect to valuation of your minerals will be the economy. Commodity prices will determine how much a company wants to spend on whichever mineral you possess, and certain elements are simply worth more than others.

While much of selling mineral rights has to do with being lucky enough to find a rich well on your land, one thing that you don’t have to leave up to fortune is finding a skilled and knowledgeable mineral rights broker to help you sell your minerals for a high dollar. At The Mineral Auction, our team understands the business of putting rights up for sale, and we work to ensure that you will be happy with the deal you end up making. To learn more from our experts, call (512) 698-2802 today.

Selling vs Leasing: advantages and disadvantages

Posted on Wednesday, November 25th, 2015 at 8:15 pm    

After you come to learn that minerals have been located on your property, you may want to consider selling or leasing those mineral rights. Here are a few key points for both selling and leasing that may help you determine which will be right for you.

Selling your mineral rights will afford you solid and assured benefits in the form of a fixed payment. You will not have to stress over rising or decreasing values. On the other hand, you may give up your rights to receive royalty payments from the mining and selling of the materials on your property. Should the value of the minerals go up, your payment will not change to reflect this.

Leasing your mineral rights usually involves creating a contract that outlines the rights both you and the oil or gas company with which you make the deal will enjoy, including the terms of the royalty payments you will receive. When leasing your mineral rights, you will receive compensation from a company just as you would were you to sell them. Leasing, however, involves an arrangement of monthly payments that only last the predetermined amount of time. While this option affords you the chance to earn more should the value of your mineral increase, it also poses the risk of decreased payments when values decrease.

If you are considering selling or leasing your mineral rights, it is best to consult with our mineral rights specialists at The Mineral Auction in order to discuss which option will work best for you. Call us today at (512) 698-2802 to speak to a representative.

Texas law and your mineral estate

Posted on Friday, November 6th, 2015 at 4:08 pm    

Land ownership in Texas is divided between the mineral estate and the surface estate, according to the Railroad Commission of Texas. Considering the widespread development of oil and gas properties in Texas over time, the two estate properties are usually owned by different people. The division happens when the surface estate is sold and the mineral rights are retained by the owners. There are cases in which the owner sells mineral rights but keeps the surface, but it is considered a rare occasion.

Mineral estate is dominant under the Texas law, which generally means that the owner may freely use the surface to access the mineral property, depending on the lease or the deed involved. However, many cities have ordinances that restrict oil and gas activities on the properties within the city’s jurisdiction.

If you are considering selling mineral rights in Texas, our qualified representatives at The Mineral Auction are ready to work on your case and alleviate the burden of finding a trustworthy buyer. Call us now at (512) 698-2802 to learn about our unique approach.

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