In Texas, mineral rights can be traded, transferred, leased, or owned separately from the surface estate, known as severed, which gives the holder of the mineral estate distinct rights regarding the extraction of minerals
The mineral estate includes five severable rights:
- The right to develop
- The right to lease
- The right to receive bonus payments
- The right to receive delay rentals
- The right to receive royalty payments
Essentially, mineral rights take precedence over surface rights, which means the holder of the mineral rights also has the right to use the surface estate as necessary for resource extraction. Generally the use of land for extraction has been established in agreement with the corporation extracting the resources.
For surface owners, this separation imposes limitations on land use, like potentially hindering development plans that conflict with those of mineral owners. Severed mineral rights can also significantly diminish the income of surface owners through lucrative lease agreements and royalty payments.
Understanding Mineral Rights and Inheritance Laws
In Texas, the distribution of mineral rights upon an owner’s death is subject to the same inheritance laws as any other asset. The process is dictated by a legal framework that hinges on the presence of a will.
If the deceased did not leave a will, the Texas Estate Code outlines how the estate, including mineral rights, is allocated among the heirs. If there is a will, the mineral rights are transferred according to its terms.
Often, heirs may not be fully aware of their entitlement to mineral rights or the extent of their ownership. In such cases, a professional known as a Landman can be instrumental in identifying and locating mineral rights ownership, and facilitating negotiations with oil companies.