Pros And Cons Of Selling Mineral Rights

Posted on: 11 October 2016

If you're a homeowner or landowner in certain areas of the US (for example, somewhere near where oil and gas companies have been pumping these substances out of the ground in enormous quantities), you may find that you own something called "mineral rights" that you could sell for a good deal of cash. Of course, how much your mineral rights are worth depends on the market, your location, and many other things, but if someone makes you an offer, how will you decide whether to take it? Here are some pros and cons of selling to help you navigate your way through such a situation.


One great thing about selling is that it opens up the opportunity to make money off your land in a way that most people might never think of. And it allows you to profit from the mineral rights even if you don't have the big-business budget that would allow you to mine the area yourself. After all, even though you live in an area known for oil drilling, you've never gotten into the oil business yourself, have you? The oil business is so risky and takes so much equipment to get started with that you practically have to be a large company in order to be able to absorb the risk. Fortunately, if an oil company buys your mineral rights, there's no risk for you, just cash. And you'll be able to get rid of that nagging feeling that there's oil under your land that's just sitting there unused.


In some situations, selling your mineral rights can be a mistake. For example, if you have a vein of valuable minerals under your land as well as the oil that the company wants to mine, you may wish to opt for simply leasing the rights so the company can get the oil out but you'll still have access to the valuable minerals later (perhaps you can get more money from another company that wants to lease the rights to mine for that particular mineral a few years down the road). Or if you're an environmentalist and disagree with the drilling practices used by oil companies, you may not feel comfortable with allowing them to do the same things on your very own land.

These pros and cons will help you make the decision whether or not to sell your mineral rights. Even if you decide not to sell, you may wish to consider leasing as a compromise that will still allow you to get paid and still allow the company to drill on your land. Contact a company like Appalachian Mineral Partners for more info.