How To Buy Mineral Rights

With the oil and gas industry being in a state of flux, you may be considering buying mineral rights as a way of profiting on the next upswing in the energy market.  While adjustments in the industry have provided some potentially profitable opportunities, investing in an undervalued market comes with inherent risks. Plenty of proper due diligence and qualified professional help are essential elements to adding profitable mineral rights to your portfolio.

From this article, you will:

  • Learn the qualities of a good mineral rights investment
  • Discover the various options for buying rights
  • Understand the advantages of choosing Eckard Enterprises over other mineral rights professionals.
  • Appreciate how buying profitable mineral rights impacts your money situation as a whole

Why Buy Mineral Rights?

There is a lot of activity in the mineral rights market these days. With oil and gas prices hovering at all-time lows and a growing push for cleaner-burning fuels, many oil and gas companies are restructuring, renegotiating bank loans, and even filing bankruptcy. As a result, the volume of mineral rights transactions has increased considerably.

These unsettling conditions provide excellent profit opportunities for you to purchase some undervalued mineral rights. The trick is learning how to buy mineral rights that fit in the undervalued category. To do so, you must possess a profound knowledge of this industry to mitigate the risks or partner with professionals who have a successful track record with purchasing mineral rights.

Options for Buying Mineral Rights

Mineral right sellers use several channels to offer their rights to buyers with the option of purchasing the rights in whole, in royalties, leases, and production payments. The main ways to buy mineral rights are

  • Auctions: Auctions generate high trader participation because they tend to bring higher prices for mineral rights owners, who pay a commission on the sale. Most auctions operate online.
  • Government auctions: Mainly conducted online, these auctions involve mineral interests on federal and state public land. The governments list the rights with the parcels of land, and it surrenders the rights to the highest bidder. 
  • Brokers: You can find broker-listed mineral rights for sale on online marketplaces. They charge the seller between 5% to 15% commission.
  • Private placement: Mineral rights professionals use a network of investors to offer the royalty buyer the most promising exploration and development ventures. 

Industry Expert-Eckard Enterprises

Evaluating mineral rights’ value and profit potential is not an easy task. However, Eckard Enterprises has over 35 years of experience of:

  • Identifying blocks of undervalued mineral assets
  • Negotiating the conditions of sale, 
  • Overseeing the maturation of mineral assets 
  • Developing maximum cash flow from mineral rights.

By partnering with its investors like you, Eckard provides a vested interest in enhancing your mineral portfolio. Plus, Eckard has the vital due diligence capabilities and valuable industry insider knowledge necessary to make the most of your energy investments. 

Verifying mineral rights ownership is a crucial part of the execution of royalty dispersion. Without valid confirmation of current ownership, nobody gets paid. To expedite this process, Eckard uses several landman companies that do the investigative work necessary to ensure you get a completely vetted mineral rights deed. Find out more about Eckard’s 120-day royalty schedule. 

Mineral Rights Consultants

Reputable mineral rights consulting firms can be beneficial in ascertaining the value of your mineral rights. Often equipped with an in-house accounting department with insurance specialists, mineral rights consulting firms do the research and data analysis to give you a clear picture of the mineral rights’ current value and future developmental potential. Some of the services they provide are:

  • Drill proposal reviews
  • Oil and gas lease reviews
  • Rate forecasts
  • Fair Market Value Appraisals

Since these firms specialize in evaluating and reporting, they collaborate with other industry experts and companies on energy-related projects involving mineral owners, trusts, and governmental agencies. If you decided to work with a mineral rights consultant, you would most likely put together your own team of professionals for exploration, acquisition, negotiation, and asset management. 

Working With a Realtor or Lawyer

After you’ve found the mineral rights that meet your criteria, you’ll need to close the deal with the best terms. Some investors choose specialized lawyers or realtors to negotiate the final terms and complete the transaction. However, it is essential to pick a realtor or legal professional who has extensive experience in the type of mineral you are buying rights to. Also, they must fully understand the mineral rights ownership and royalty process, along with essentially industry terminology.

Mineral Rights Sites

Mineral rights sites give buyers the option of skipping the middlemen and finding motivated sellers. Additionally, these sites offer advanced search engines that allow you to find mineral rights listings by state, mineral type, and rights structure. So, whether you’re looking for mineral rights with royalty agreements, lease availability, or severed rights, these web platforms can accommodate you.

Although most of these websites provide some mineral rights educational material about how to buy mineral rights, you are on your own in terms of evaluating the offerings, negotiating the sale, and closing. These online ventures can be very treacherous for even the experienced investor without the mineral rights expertise. Also, many of these websites tend to be seller-oriented. 

Upstream Oil and Gas Companies

As part of normal financial activity, oil and gas companies will sell off some of their mineral rights.  These E&P activities allow you to potentially capitalize by buying completed vetted mineral rights that some of these companies are parting with. However, E&P companies normally sell their mineral rights through brokers. Consequently, it pays to have expert guidance in finding the best E&P offerings. 

How to Partner with Eckard Enterprises

Partnering with Eckard Enterprises is not very difficult, provided you are ready to add energy to your investment portfolio, and you are a high-net-worth investor. By definition, a high-net-worth investor consistently earns $200,000 or more a year ($300,00 jointly) or has a net worth of over $1 million at the time of purchase, excluding the primary residence. The benefits of partnering with Eckard are:

  • Access and direct ownership to intangible assets
  • Being top priority in choosing the investments that Eckard offers
  • Access to proprietary resources from Eckard’s extensive vault of information.

How Buying Mineral Rights Relates to Your Money

Shakey energy market conditions can yield some great opportunities for you to find and secure undervalued mineral rights. This prospect is becoming more likely as the post-Covid energy industry shows signs of recovery with the upward trend of oil and gas futures. As a result, adding potentially high-yielding mineral rights could become a strong hedge to your growth investments. To learn more about opportunities in investing in mineral rights, contact us