Problems with Keeping Your Mineral Rights

If you own mineral rights, there are many possibilities open to you. You can keep it, lease it, or sell it. However, no one really knows if your mineral rights are worth anything until you start digging, so it is pretty much a gamble whatever you do. This is especially true if your mineral rights are in a location known for rich deposits of an industrially valuable commodity such as oil or natural gas.

If you keep it to yourself, there is a chance that you can make more money later on if it turns out you are sitting on a gold mine, sometimes literally! But, the converse is also true. If it turns out that you have nothing, then the value goes down to zero.

If you lease or sell the rights, you are taking a chance that you have agreed to terms that are not advantageous to you. For example, if you lease it for an X amount annually, and agree to so much in royalty fees, you are tied to that for the duration of the lease even as the developer mines millions. The same will apply when selling your mineral rights. The big difference between leasing and selling is that with selling, you can get a big amount of cash right then and there. You will also never have to worry about keeping track of rental fees and royalty checks.

Of course, you could be losing out on a fortune when you sell. On the other hand, you could be getting a lot of money for mineral rights that turn out to be a bust. The trick is to sell at the right amount to the right buyer so that the chances that you will lose out are smaller. Companies such as The Mineral Auction in Austin, Texas lets you put your mineral rights up for bids to legitimate buyers. The beauty of it is that you do not have to sell them to the highest bidder if you don’t feel like you’re getting what you want.