Originally published on newscase.com
When it comes to sifting out who owns the mineral rights on a given parcel of land, it can feel overwhelming and complex. After all, mineral rights can be tied up in tricky deeds that date back several generations and over 200 hundred years. In this article, Adam Ferrari discusses whether your warranty deed includes mineral rights, and what to do if they are included.
What are Mineral Rights?
Mineral rights, not to be confused with surface rights, refers to the legal ownership of minerals beneath a given piece of land. The owner of mineral rights owns the space beneath the ground that may contain valuable minerals such as oil/natural gas, coal, precious and semi-precious metals, and specialty elements such as uranium.
If your warranty deed includes mineral rights, then you have the right to profit from whatever may be mined below the surface of the land. However, mineral rights owners do not have ownership over sand, gravel, limestone, and subsurface water—these elements are close enough to the surface that they are owned via the surface rights.
How Do I know If My Warranty Deed Includes Mineral Rights?
In the majority of cases, the status of mineral rights on a given piece of land will not appear on your current property deed. Mineral rights and surface rights can be separated and sold separately; meaning that just because you have a home on the land, it does not mean that you own the ground beneath it.
The only way to be sure that your warranty deed has mineral rights is to research the chain of title. With this back-tracing, you can confirm that the mineral rights were not previously severed from the original endowment of the estate.
If mineral interests have been separated, title searchers will have to be brought on to trace the mineral rights as far back as possible, potentially to the original land grant. This process can be very time consuming and tedious. In many cases, it involves sifting through very old, hand-written documents.
Could My Mineral Rights Be Profitable?
The shorter answer is yes. If an oil and gas company has reached out to you with interest in buying your mineral rights, you could have some unexpected cash inflow coming your way. However, some mineral rights may be mostly worthless without interest in precious materials underneath the surface and therefore bear no tangible financial upside. The value of mineral rights varies from day to day, and it is not easily calculable. One of the best methods of determining current value is to list your mineral rights for sale and see how much individuals are willing to buy them for. The team at Ferrari Energy has compiled one of the most extensive mineral rights valuation databases in the entire industry and is ready to assist you in this process at the appropriate time.
Tracking down whether or not your warranty deed includes mineral rights can be a difficult task and the team at Ferrari Energy is ready and able to assist you with this task as this is a core expertise at Ferrari Energy. If it turns out that land you own does have mineral interests included, this exercise can be quite profitable. Who knows, you might be in for a very profitable drill!
About Adam Ferrari
Adam Ferrari is the founder of the Denver-based mineral acquisitions company Ferrari Energy. He is a chemical engineer by degree and is an accomplished petroleum engineer by profession. He also has experience in the financial sector through his work at an investment banking firm. Under his leadership, his company has supported numerous charitable organizations including St. Jude Children’s Hospital, Freedom Service Dogs, Denver Rescue Mission, Coats for Colorado, and Next Steps of Chicago.