How to Get Oil Companies to Drill On Your Land
If you own mineral rights in the United States, you may be sitting on a potentially large stream of income. Thousands of property owners across the country have contacted oil companies and investors in order to drill and profit from the precious minerals in Earth. This is your guide on how to get oil companies to drill on your land too.
In general, this is accomplished one of two ways: by selling or leasing mineral rights. In this article, we are going to explore the pros and cons of selling or leasing your mineral rights as you seek to find an answer on how to get oil companies to drill on your land too.
Selling Your Mineral Rights
When you sell your mineral rights, an interested party becomes the owner of your property’s subsurface and has the right to explore it for valuable minerals. Aren’t you selling directly to the oil company? Then, the buyer likely has plans to start or continue a drilling operation.
Pros of Selling Your Mineral Rights
- Mineral rights sales are generally settled with large lump sums of cash.
- The sale of mineral rights is eligible for a 1031 exchange, which can be used to strategically acquire another property without the income tax.
- You will no longer have to pay taxes on your mineral rights or oil royalties.
Cons of Selling Your Mineral Rights
- Your mineral rights have the potential to become more valuable in the future.
Leasing Your Mineral Rights
Alternatively, if you do not want to give up your mineral rights entirely, you have the option to sign an oil and gas lease. In a mineral rights lease, you can sign a temporary agreement. This is to let an oil and gas company explore, procure, and sell minerals from your property.
Pros of Leasing Your Mineral Rights
- You may receive an initial bonus, and signing payment.
- If the production is successful, you will earn oil or gas royalties on the precious minerals produced.
- You still maintain ownership of your mineral rights and have only agreed to the temporary exploration of the site.
Cons of Leasing Your Mineral Rights
- Leases dependent on large oil production levels may not cash out as well as expected
- Oil lease ownership can change hands without your involvement.
Contacting the Right People
Once you have decided whether a lease or sale is best for your mineral rights, then it becomes time to get into contact with the right people. There are many companies and individuals who are going to be interested in acquiring the right to drill on your land for oil or gas, so it is important to work with someone you can trust. Ranger Minerals is a Texas-based company with over 100 years of combined industry experience that can help with mineral rights transactions all across the country.
I’m looking for knowledge and information in leasing mineral rights.
We have 655 acres near Robert Lee. Wolf Camp area. We leased our minerals to Devon energy about 5 years ago for $800 acre.
Was thinking about leasing again. I heard Devon merged or sold.
My wife has mineral rights to 1,000 acres in Benkelman, NE. She was receiving royalties from Forrest Oil. We are trying to get information on the possibility of drilling on the land.
I own the mineral rights to land that is rich in natural gas in Alabama. Gas wells border my property and still pumping from the 90s. Looking for someone interested in taking a look
I am Looking for An Operator to Drill for Oil On Some Property that I own. Now I know that it would Cost $300,000 to $ 500,000 Thousand Dollars to Drill! I would Gladly go 50/50 for some one to do this Job for me. I have Approximately 1200 Acres of Land.
Do you have names of oil companies and contact names or info. I have some land in Louisiana
Interested – have leased before, active acreage in Bosco Field, Louisiana.
Oil and gas drilling on my land