FAQ’s About Oil & Gas Royalties

Have questions about how mineral rights work? We have the answers. Talking and learning about minerals and royalties can feel overwhelming at first. Here is a comprehensive list of questions and answers most people have when it comes to selling mineral rights. Do you want answers to your specific scenario or situation? Call us at 720-545-1755 or fill out a contact form. We will be happy to assist you.

What are mineral rights?

Ownership of mineral rights (or “mineral interests”) is an interest in real property. It is the right of the property owner to exploit, mine, and/or produce any or all of the minerals lying below the surface of the property.  These are often leased from the mineral owner by an oil or gas company to potentially drill for oil or gas.  If oil or gas is found, the payment the mineral owner receives is a “royalty.”

The payment made to a mineral owner for their interest in oil, gas, or other items of value mined from their mineral interests.

“Mineral rights” commonly refers to the ownership of undersurface oil and gas minerals resulting in monthly checks from oil and gas operating companies.

Selling minerals is a personal decision, or in some cases a family decision. Life, unfortunately, provides reasons one may need to sell minerals for a large lump sum of cash quickly, rather than receive smaller amounts monthly. See our Why Sell page for examples.

You can sell or buy oil & gas mineral royalties by yourself, with a broker or at auction for a fee or commission. To legally transfer your mineral interests, a notarized deed to the Grantee will need to be recorded with the County Recorders office.

Overland Minerals and Royalties has a stellar reputation with land owners all over the country. Please visit our Testimonials page or call us to find out more. We have conducted hundreds of transactions via email, fax and mail without ever meeting face to face.

Nothing. There is no cost to you to sell your mineral rights. In rare situations, legal work may be required. Unlike many other oil and gas royalty companies, Overland Minerals & Royalties will be transparent and can help ensure the correct legal work is done.

Yes. A trust can sell all or portions of its oil and gas royalties. Proper authorization and a certificate of authority are required from the Trust’s Trustee on a purchase agreement and the mineral deed. You are able to cash out your portion of a trust.

We are long-term investors who accept the many risks for many years to see a positive return on the purchase. What’s important in the short term is that you feel comfortable that you’re getting a fair deal from a trusted buyer. If you have questions about the oil and gas royalty evaluation, ask!

Yes, you will have to pay federal and, in some cases, state taxes. However, these are generally capital gains taxes, so they are taxed at a lower rate. Depending on the circumstances, tax credits may be applicable as well. Please consult a tax accountant for more detailed information.

Give us a call; we’ll help you figure it out. Of course, there is no obligation to sell your mineral rights, so feel free to utilize our expertise to assist with your situation.

In simplest terms, leasing your minerals gives permission to the leasing company to look for, and potentially extract and sell the oil and gas. The lease will have terms and a royalty rate. The lease rate, or royalty rate, is your share of the oil and gas, if and when they are extracted, processed, and sold. Leases can expire, and alternatively, leases from years ago may still be valid. Leases are legal documents, so each one requires a signature.

Mineral rights cannot expire. Mineral interests can be sold, granted, and/or inherited. An oil and gas lease may expire per the terms of a lease, but your mineral royalties do not expire.

We are oil and gas royalty buyers.

Overland buys directly from owners and is not a broker. Our professional landmen work with owners to ensure we have a full understanding of what is owned so Overland can make a top offer.

ORRI (Overriding Royalty Interest) is similar to Working Interest (WI), however, the main difference is ORRI parties do not participate in the drilling and operating costs of the well. They do not own the mineral rights but own the rights to the proceeds from the oil and gas production.

WI (Working Interest) refers to the interest the operator and non-operators own. Working Interest parties share the costs of drilling and bringing to market the oil and gas from the well.

You can sell a portion of your oil and gas royalties either by percentage or by net mineral acres. However, something to consider is the amount of interest you own. The more it is split up, the value becomes diluted. For example, your family ordered a pizza. Your mother gave each sibling 1 piece. You can split your piece up again, eat half and sell half, but will your belly be full, and did you get enough money for selling?

Probate is the legal work and documentation needed to legally transfer ownership from a deceased person to devisees or heirs. Laws and requirements may vary from state to state.