Let's Discuss Mineral Rights

WHAT ARE MINERAL RIGHTS?

Real property can be categorized into two components: surface interests and mineral interests. In North Dakota, mineral interests refer to ownership of “oil, gas, coal, clay, gravel, uranium, and all other minerals of any kind and nature.”

HOW DO MINERAL RIGHTS OPERATE?

Mineral rights can be “severed” from surface ownership by reserving minerals during land transfers. This means that it’s common in North Dakota for different parties to own the surface and mineral rights separately.

WHAT IS THE DURATION OF MINERAL INTERESTS?

Mineral interests endure indefinitely unless they are abandoned. Abandonment occurs when minerals remain unused or unclaimed for twenty or more years. Under North Dakota law, “use” of minerals involves activities like production, leasing, or conveyance.

Mineral interest owners can also protect their rights by recording a document called a “Statement of Claim.” This safeguards their mineral interests from being considered abandoned, even if they are not actively used, for up to twenty years.

CAN MINERAL INTERESTS BE FORFEITED?

As mentioned earlier, if mineral interests remain unused or unclaimed for over twenty years, they are deemed abandoned. Surface landowners can initiate court proceedings to gain ownership of abandoned minerals beneath their land. Mineral owners can respond to such actions, but in many cases, rightful mineral owners may not even be aware of their interests.

SEARCHING FOR MINERAL RIGHTS RECORDS

Clients often have uncertainties about their mineral rights, and we assist them in searching for recorded deeds or other mineral rights records. Sometimes, we collaborate with third-party landmen to search for mineral rights records in various North Dakota counties or perform mineral title opinions to ascertain ownership details.

THE VALUATION OF MINERAL RIGHTS

We also rely on landmen’s expertise when clients need to determine the value of mineral rights, such as during the probate process. Landmen assess factors like mineral location, ownership percentage, oil prices, and more to provide a mineral rights appraisal.

HOW CAN I ACQUIRE MINERAL RIGHTS?

For surface owners, the court process for abandoned minerals mentioned earlier is one way to obtain mineral rights. Many mineral rights are passed down through families, either through direct deeds or through the probate process.

WHAT IF I’M NOT A SURFACE OWNER AND MY FAMILY DOESN’T OWN MINERALS—CAN I PURCHASE MINERAL RIGHTS?

Absolutely, you can purchase mineral rights if you find an owner willing to sell. Given the recognized value of minerals, it can be challenging to find mineral rights for sale, especially in the top oil-producing counties of western North Dakota. Nonetheless, it is entirely possible to acquire them.

WHAT IF I WANT TO SELL MY OIL RIGHTS?

Once again, many individuals recognize the value of mineral rights. If your minerals are in a highly productive location, you are likely to find interested buyers. Selling or purchasing mineral rights follows a process similar to real property sales.

First, confirm precisely what you own to avoid accidentally selling something you don’t own. Starting with a mineral title opinion and appraisal is a wise move; it will clarify your ownership and its value. Subsequently, you can proceed with a purchase agreement and ultimately sign a mineral deed to convey your interests to the buyer.

WHAT IS A MINERAL DEED?

A mineral deed closely resembles any other real property deed, but instead of transferring surface property, it transfers ownership of the minerals beneath the described legal area. A mineral deed conveys “oil, gas, coal, clay, gravel, uranium, and all other minerals of any kind and nature” from the Grantor (current owner) to the Grantee (new owner).

Since there may be multiple mineral owners within the same legal description, a mineral deed can only transfer the interests owned by the Grantor.

THIS CAN BE COMPLEX—CAN YOU PROVIDE ASSISTANCE?

Absolutely! Understanding mineral rights can be challenging, and we are here to assist you. Whether you need to safeguard existing mineral rights, determine if you possess them, or engage in buying, selling, or transferring mineral rights, we can guide you in the right direction.

We have successfully assisted clients with their mineral interests across North Dakota. Please don”t hesitate to reach out to us at 701-852-5224 to explore how we can assist you further!