Leasing your land to an oil and gas company can earn you large amounts of money for the sale of resources owned within your mineral rights. So much so, that many people seek out oil and gas companies in the hope that their mineral rights may be valuable in some way.
Of course, entering into a contract with a landman can be extremely complicated and intimidating with some wondering if it is all worth the hassle. Below, we will outline your options after being approached by an oil company to lease your land.
Option 1: Lease Your Mineral Rights
Obviously, your first choice here is to sign the agreement. The oil company may have promised a large amount of money if you sign immediately, and that may just be too hard to pass up. Of course, mineral rights leases are highly negotiable, which means that you do not have to hastily agree before fully analyzing the contract terms.
If you’re approached by an oil company out of the blue, it is a good rule of thumb not to sign the first thing they give you. Instead, seek a lawyer or mineral rights expert to look over the agreement and set you up for success.
Option 2: Do Not Lease Your Mineral Rights
If you don’t like the idea of having an oil drilling operation on your land, then simply don’t sign the contract. In mineral-rich states like Texas, Pennsylvania, and Colorado, some companies may try everything they can to get you to sign the dotted line, however as the mineral rights owner, you can ultimately decide the fate of your land.
Option 3: Sell Your Mineral Rights
If you do not want to lease your mineral rights, but still want to profit from your property’s valuable resources, then you may want to consider selling outright. You can either sell your entire estate (surface and subsurface rights) or simply sell your mineral rights. If the oil and gas company wants to lease your land, that means someone out there would be interested in purchasing it. That way, you can earn a more immediate lump sum.