There are currently over 600 registered mining companies operating in Texas. Most of these companies mine for silver, uranium, and copper. A little over half of these miners have more mineralization in a shallow pit, isolated drill hole, or outcrops.
If you are looking to sell or buy mineral rights in Texas, it is not enough to only know which companies you should work with. Basic knowledge of the industry can help you maximize your deals while also avoiding possible pitfalls associated with selling or buying mineral rights. Here are some of the crucial information you need to know.
Know the minerals in your inventory.
Before you enter into any deals, you have to know what minerals you currently have. Otherwise, you might enter into an agreement that you might regret later on. Now, Texas grants the right to explore different minerals like clay, oil, natural gas, sand, clay, stove, metal ore, iron, and copper. This state is also known for producing gas and oil. It is home to the United States’ most significant oil fields, with the most prominent ones located in Eagle Ford Shale and Permian Basin. Before you sell or buy your mineral rights, make sure you know what is acceptable or what is not.
Know your right over such minerals.
After finalizing your inventory and knowing which minerals are acceptable or not, it is time to determine the status of your ownership over these minerals. To know your rights over these minerals, check your deed of ownership. Most of the time, your mineral rights include rights over the land where these minerals are mined. Then again, if the legal clause in your deed says “ less and except” or “less, save and except,” then this means you cannot claim ownership of the land or minerals specified after the word “except.” To ensure that you know what you’re getting yourself into, it is better to have a lawyer or title deed company to go over the provisions of the deed before you buy or sell.
If you are new to this industry, you must know that the minerals are not yours until you extract them. This means that when you sell your mineral rights, you are only authorizing the said individual or mining company to obtain the minerals and bring them to the surface. If they are on the surface, that is the time anyone can claim ownership or rights over them. If you go over the terms of the contract of the buyers and sellers of mineral rights in Texas, you can see that they either indicate permanent ownership or lease. If you sell your ownership right, you can get paid in a lump sum or installments. Aside from knowing your rights over the land and minerals, it is also equally important that you know all your payment options. If you need the help of a legal counsel, seek the advice of one before you say yes to any deal. When you learn about your options, also consider the crucial aspects of your mineral rights like your right to bonus considerations, royalties, rights renewal and extension, and conveyance of rights.
Before you enter into any agreement or business venture, you must understand the industry you are joining and the nature of the business. You cannot take shortcuts by blindly following your gut. When you take risks, make sure it is a calculated one. Otherwise, your primary purpose of earning money will be easily defeated.