When someone passes away, mineral rights are often included as an asset of said person’s estate. If you inherit mineral rights, you may not be sure what to do next. In this article, we will outline a few options for what to do with your newly bequeathed mineral rights and if you should retain, lease, or sell inherited mineral rights.
Step 1: Fully Transfer the Rights
If you are the rightful heir to a recently deceased person’s mineral rights, then you will have to transfer the ownership into your name. Here, you can contact a title or insurance company to conduct the search for the proper paperwork.
Step 2: Identify any Existing Contracts
Let’s say you inherited active mineral rights that are currently leased to an oil and gas company. In order for you to receive any oil and gas royalties owned by the deceased, the will executor can contact the lessee in order to put your name on future checks. Once the lease expires, it will be up to you whether or not to renew the terms.
Step 3: Retain, Lease, or Sell Inherited Mineral Rights
Once everything is in your name, then you are free to do as you wish with your inherited mineral rights. In some parts of the country, your mineral rights may not be worth very much money. However, there are also plenty of regions in the US in which mineral rights can be very valuable if your land may contain oil, natural gas, or another precious resource.
Here, you can weigh your options and decide what to do with your new asset. Retaining mineral rights may be your only option for undesirable land, or else entering into a contract agreement may lead to great financial compensation. In a mineral rights lease, you can earn royalties from any resource extracted and sold from your property. If you choose to sell your mineral rights outright, you can potentially pocket a large lump sum of cash to help with retirement or the acquisition of another property.