Mineral Rights in Oklahoma
HOW DOES MINERAL RIGHTS OWNERSHIP IN OKLAHOMA WORK?
Owning Mineral Rights in Oklahoma
In Oklahoma, it’s important to remember that mineral rights are considered real property by law. There are different types of purchase agreements that dictate how mineral rights are handled for land owners. The three main variations are unified, split, and fractional estates.
Unified Estates
In a unified estate, a single party owns the surface rights and the mineral rights. This is the most straightforward variation.
Fractional Estates
In a fractional estate, the mineral rights ownership is distributed among multiple owners. It can be a challenge to maintain fractionalized mineral rights due to the fragmentary nature of their ownership. If one fractional mineral rights owner wishes to sell or lease their portion, they must consult the rest of the owners beforehand.
Split Estates
In a split estate, the surface rights are mineral rights ownership is separated. When land is bought or sold, the mineral rights may not be included in the transaction in a split estate.
Considerations for Owning Mineral Rights in Oklahoma
In Oklahoma, the state can allow exploration companies to develop minerals in which ownership cannot be clearly established. For this reason, you should ensure that your record of ownership is clearly documented. It is recommended to use a lawyer or title company to help establish ownership. Oklahoma mineral rights are documented publicly in the county registry office where the minerals are located, so if there is uncertainty about who owns what parts of a given tract of land there is an existing public record that can be referenced.
Forced Pooling
In Oklahoma, the oil and gas operator cannot adjust the parameters of a unit to exclude someone who owns mineral rights within that unit. Thus, the mineral owner always receives their proportionate share (acres owned/gross acres). A mineral owner who is part of a forced pooling unit will be presented with three options by the operator. They can either (1) lease their minerals, (2) consent to pooling their minerals with the rest of the participants in the unit, or (3) elect to not consent. If they do not consent, they will be force pooled. A reasonable lease offer must be made before an owner can be legally force pooled. One alternative is to attempt to lease your minerals to a company that wishes to be a non-operated working interest party, so that you may be able to negotiate more favorable terms.
Property Divisions
Oklahoma uses section-township-range descriptions for identifying mineral rights. A township/range contains 36 sections, which are numbered in a snake-like formation starting in the Northeast corner. A tract where mineral rights are located will be referred to in a manner that describes its position, such as T15N R7W S24 (Township 15 North, Range 7 West, Section 24).
Major Formations of Interest
Anadarko Basin
The fifth largest oil basin in the US, the Anadarko basin is situated predominantly in Western Oklahoma and the Texas panhandle. The Anadarko basin contains significant oil reserves, considered to be one of the most prominent shale plays in the United States by the EIA. In addition, the natural gas production in this basin has been extensive – producing over 100 trillion cubic feet of natural gas to date. Outside of oil and gas reserves, the Anadarko basin also contains high levels of helium and iodine.
SCOOP & STACK
The SCOOP (South Central Oklahoma Oil Province Play) and the STACK (Sooner Trend Anadarko Canadian and Kingfisher) are two oil and natural gas plays that are highly productive. These plays contain multiple significant geological zones. Both plays include the Woodford shale, a hydrocarbon-rich silica black shale formation that has been a leading target for development in both Oklahoma and New Mexico.
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