Often, when a business wishes to extract minerals, such as oil, gas or coal, by a piece of land, they’ll, rather than purchase the property outright, lease from its owner the land’s mineral rights. This provides the firm with all the right to harvest specific kinds of minerals in the land for a predetermined period of time. Though mineral rights can be a lucrative source of revenue, landowners must keep in mind several important hints before signing a rental.
Take Your Time
Though mineral rights leasing holds out the allure of fast money, from the beginning you must bear in mind that the process of settling with regards to the lease can last a very long time, up to several years. Oil and gas companies generally have time lines for projects, often measuring in the years. Try not to be impatient and do not be hasty in signing anything.
Field Over One Offer
It is a fantastic bet that if one business is interested in renting your house, others might be as well. If a business has approached you, then listen to their own offer then approach other companies to see what they must say. Don’t commit to anyone before knowing what you are able to get.
Know Who You Are Speaking With
Whenever someone approaches you, know who you are talking with. You ought to be aware of something about the place of the person who has contacted you and the firm he represents. You may be contacted by an employee of this business right; a contractor hired by the firm to bargain for mineral rights; or even a speculator, somebody trying to buy the rights from you then reverse them to another party for a gain. Do as much research to the interested business as you can. This includes basic Internet searches, in addition to discussions with other parties who have coped with them, particularly other mineral rights .
Hire An Attorney
With mineral rights, attorneys should generally not be hired in the beginning, as the earlier they’re hired, the sooner they start to charge you. However, after you’ve listened to a couple offers and before you’ve signed anything, it is time to involve a lawyer with experience in mineral rights. Attorneys are indispensable in drawing up contracts, inspecting files and coordinating negotiations.
Get It In Writing
Be sure than everything is spelled out in the rental agreement. Don’t assume that any area that is not covered in the rental agreement, such as damages, rights to the use of surface structures and pollution controls, can be amicably settled out of a legally binding contract. To be on the safe side, try to envision anything that could possibly go wrong or be misunderstood. Additionally, ask other mineral rights owners concerning terms they wish they had included in their rentals.