Frequently Asked Questions

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Why Mineral Owners Choose to Sell Their Royalties and Minerals

Over the years, we’ve learned that mineral owners sell their royalties and minerals for a wide range of reasons. Whether it’s selling a portion of royalty interest to boost retirement income or liquidating non-producing minerals to fund a land purchase or college tuition, each individual’s situation is unique.

In many cases, mineral ownership is acquired through inheritance or passed down from family members. While this may seem straightforward, it often comes with complexities that new mineral owners may not fully understand. Unlike inheriting stocks or bonds, which have clear market values and can be quickly liquidated, mineral rights are more challenging to value and are not easily sold or transferred.

Additionally, determining how to hold ownership of mineral rights can have long-term implications for your estate. The method of ownership—whether held individually, through a corporate entity, or in a trust—can significantly impact estate planning and probate. Properly structuring ownership early on can reduce legal complexities and costs, especially since mineral rights are subject to probate in the state where they are located.

For many new, small, or inexperienced mineral owners, the difficulty in valuing these assets and the absence of a broad market for leasing or selling them leads to the decision to sell. This allows owners to reinvest in assets they understand better, and that’s where we come in to help.

• Quick, Lump-Sum Cash: Immediate liquidity for large expenses or financial goals.
• Tax Savings: Take advantage of opportunities to reduce tax liabilities.
• Debt Relief & Financial Freedom: Eliminate burdensome debt or financial stress.
• Estate Planning: Simplify estate management and avoid complex probate processes.
• Funding Other Investments: Reallocate resources toward weddings, college tuition, down payments on homes, or other personal goals.
• Ease of Management: Eliminate the hassle of accounting, record-keeping, and administrative tasks associated with mineral ownership.

At Texas Energy Alliance, we understand the challenges of owning mineral rights and provide a straightforward, transparent process to help mineral owners achieve their financial goals. Whether you're looking to liquidate assets for retirement, reduce financial stress, or fund major life events, we’re here to guide you every step of the way.

Navigating the Mineral Market with Confidence

Over the past five years, we’ve leveraged high mineral prices to sell some of the mineral rights we acquired in the 1980s and 1990s. Through this process, we’ve built relationships with legitimate, trustworthy buyers and developed a deep understanding of the industry.

As mineral owners, we know how overwhelming it can be to receive daily offer letters from companies promising high prices but providing vague terms and conditions. Unfortunately, many of these companies are “flippers”—their primary goal is to lock your minerals into a contract and then resell them for a higher price to someone else. These buyers rarely have your best interests at heart.

In this small, tight-knit industry, we know who the legitimate players are—and who to avoid. Over the years, we’ve compiled a blacklist of unreliable companies based on our own experiences and feedback from trusted friends and partners. These are companies with histories of bad dealings, shady contracts, or unethical practices.

• Trusted Network: We’ve spent decades identifying reputable buyers and eliminating risky ones, so you can be confident in your transactions.
• Industry Knowledge: Our team understands the complexities of the mineral market and can guide you through every step of the selling process.
• Transparent Terms: We ensure your offers are clear, fair, and aligned with your financial goals.

We’re here to help you make informed decisions about your minerals.

• Send Us Your Questions: Get answers to your most pressing concerns.
• Schedule a Consultation Call: Talk with one of our experts to understand your options.
• Use Our Sell Your Minerals Form: Let us guide you through the process and connect you with the right buyers.

Don’t navigate the mineral market alone. With our network, experience, and commitment to transparency, Texas Energy Alliance is here to help you maximize the value of your assets while avoiding the pitfalls of unreliable buyers. Contact us today to get started!

How Much Are Your Minerals Worth?

This is one of the most common questions we receive, and the truth is, the value of your minerals depends on many factors. From the location of your property to the production status and market conditions, several elements influence how much a buyer is willing to pay today.

1. Location: Minerals in active oil and gas regions tend to be more valuable.
2. Production Status: Producing minerals typically command higher prices than non-producing ones.
3. Lease Status: Leased minerals may provide immediate value, while unleased minerals carry future potential.
4. Royalty Interest: The percentage of royalties tied to your minerals directly impacts their worth.
5. Regulatory Activity: Spacing, pooling orders, permits, and other regulatory developments can affect market interest.
6. Market Trends: Oil and gas prices, as well as industry demand, can cause significant fluctuations in value.

The value of your minerals can change dramatically in just a few months—sometimes increasing, other times decreasing—depending on market conditions and local drilling activity.

Unlike selling a home, the process of selling minerals lacks the transparency, liquidity, and governance you might expect. This complexity makes it essential to work with someone who understands the market.

At Texas Energy Alliance, we’ve been involved in the mineral industry since 1980. Our experience gives us a deep understanding of the market, its players, and its nuances.

• Expert Guidance: We’ve successfully navigated this market for decades and can help you make informed decisions.
• Trusted Network: Our extensive connections with reputable buyers ensure you get a fair offer.
• Proven Success: We’ve built our expertise by being active mineral owners ourselves.

We’re here to guide you through the complexities of determining the value of your minerals.

• Send Us Your Questions: We’ll help you understand your options.
• Schedule a Consultation Call: Talk with one of our experts to get personalized advice.
• Use Our Sell Your Minerals Form: Start the process today and let us help you maximize the value of your assets.

Mineral ownership can feel overwhelming, but you don’t have to navigate it alone. With Texas Energy Alliance, you gain the knowledge, resources, and support you need to make the best decision for you and your family. Contact us today to learn more!

Avoiding Common Mistakes When Selling or Leasing Mineral Rights

Selling or leasing your mineral rights can be a lucrative opportunity, but it’s also a process that comes with its fair share of challenges. Many mineral owners make common mistakes that can lead to unnecessary stress, delays, or lost profit. With the right guidance, you can avoid these pitfalls and ensure a smoother, more rewarding experience.

1. Waiting Too Long to Sell
   
   • Many mineral owners delay selling their rights, hoping the value will increase. While this strategy might work occasionally, it often results in missed opportunities as market conditions fluctuate. Timing is critical, and waiting too long can mean losing out on favorable offers.

1. Trying to Sell Without Professional Help
   
   • While selling mineral rights independently might seem like a way to save money, it often leads to a more complicated, stressful, and time-consuming process. Without expert knowledge of the market, negotiations, and legal requirements, you may end up leaving money on the table.

1. Not Understanding the Value of Your Rights
   
   • Failing to account for factors like location, production potential, lease status, and market conditions can result in undervaluing your minerals or accepting unfair offers.

1. Choosing the Wrong Buyer
   
   • Working with unreliable or inexperienced buyers can lead to lengthy delays, hidden fees, or unfavorable terms.

By partnering with an experienced mineral rights specialist, you can avoid these pitfalls and maximize the value of your assets. At Texas Energy Alliance, we make the process simple and stress-free by:

• Providing Accurate Valuations: We analyze key factors to ensure you receive a fair and competitive offer.
• Connecting You with Trusted Buyers: Our network includes reputable and experienced buyers who are ready to purchase.
• Simplifying the Process: We handle the complexities of title work, negotiations, and closing, so you don’t have to.
• Ensuring Transparency: We prioritize clear communication and terms, so you know exactly what to expect.

Avoid the common mistakes that many mineral owners make by working with Texas Energy Alliance. Whether you’re selling or leasing, our team has the expertise and network to help you achieve your financial goals.

• Send Us Your Questions: Get answers to any concerns you have about selling or leasing your rights.
• Schedule a Consultation Call: Speak with an expert for personalized guidance.
• Use Our Sell Your Minerals Form: Start the process today and take the first step toward unlocking the full potential of your mineral rights.

Don’t let mistakes cost you valuable time or money. With the right team by your side, you can make informed decisions and secure the best possible outcome. Contact Texas Energy Alliance today to get started!

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Documents Needed to Change Ownership of Mineral Rights

Transferring ownership of mineral rights requires specific legal documentation to ensure the process is completed correctly. Whether you’re selling, inheriting, or transferring your mineral rights, understanding the necessary paperwork is critical.

The following types of documents can establish or change ownership of a real property account for mineral rights:

1. Deeds:
   
   • Commonly used to transfer ownership, including mineral deeds, warranty deeds, and quitclaim deeds.

1. Titles:
   
   • Titles provide proof of ownership and are often required to verify the legal transfer of rights.

1. Court Orders:
   
   • Court rulings, such as divorce decrees or judgments, may dictate changes in mineral ownership.

1. Death Certificates or Probate Documents:
   
   • In cases of inheritance, a death certificate and/or probate documents are necessary to establish the rightful new owner.

1. Additional Documentation:
   
   • Depending on the situation, multiple documents may be required to complete the process.

To officially change ownership, the relevant documents must be recorded in the county where the minerals are located. This step ensures the transfer is recognized legally and that the public record reflects the updated ownership.

Changing ownership of mineral rights can be a complex process, and mistakes or omissions can lead to delays or disputes. To ensure everything is handled properly, consider consulting with one of the following professionals:

• Attorney: For legal advice on the preparation and filing of documents.
• Real Estate Professional: To assist with property-specific requirements.
• Landman: For expertise in mineral rights and ownership transfers.

At Texas Energy Alliance, we’re here to help you navigate the complexities of mineral rights ownership. Whether you’re buying, selling, or inheriting minerals, we can guide you through the process and connect you with the right resources to ensure a seamless transaction.

Contact us today for more information or to schedule a consultation!

Understanding Mineral Ownership

Determining mineral ownership can be complex, but it starts with reviewing public records. Ownership should be documented in the courthouse of the county where the land is located. Additionally, Tax Commission records may provide helpful information. However, if you're unsure about ownership, you may need assistance from a landman or attorney to research the records thoroughly.

If you’re interested in selling or leasing your mineral rights, fill out our form, and we’ll help determine what you own and guide you through the process.

Mineral ownership isn’t always straightforward, and there are different types of interests that can create confusion for those unfamiliar with the industry. Below is an overview of the most common types of mineral ownership:

This is the most commonly held type of mineral ownership and provides the holder with full rights to all minerals beneath the property.

Key Features:

• Full ownership of all oil, gas, and minerals.
• Complete control over lease negotiations.
• Entitlement to all royalty payments and bonuses generated from mineral production.
• The mineral owner retains full development rights and can extract resources at will.

A Non-Executive Mineral Interest (NEMI) owner holds mineral rights but does not have the authority to negotiate lease agreements.

Key Features:

• Entitled to royalties and lease payments as determined by the lease terms.
• No ability to control or negotiate the lease.
• Lease decisions are made by the primary mineral interest holder.

A Non-Participating Royalty Interest (NPRI) is a step further removed from ownership rights. The NPRI owner has no control over lease negotiations and does not receive lease bonuses.

Key Features:

• Receives a fixed or percentage royalty from production revenue, carved out of the mineral owner’s royalty share.
• No lease negotiation rights.
• Does not receive a share of any lease bonuses.

An Overriding Royalty Interest (ORRI) is tied to the leaseholder's working interest and is separate from traditional mineral ownership.

Key Features:

• Entitled to a percentage of production revenue while the lease is active.
• ORRI is tied to the working interest of the asset, not the mineral interest.
• Ends when the underlying lease expires.
• Typically granted as part of a negotiation in oil and gas development agreements.

At Texas Energy Alliance, we specialize in helping mineral owners understand their interests and navigate the complexities of ownership. Whether you hold a mineral interest, NEMI, NPRI, or ORRI, we can help you determine the value of your rights, connect you with trusted buyers, and simplify the process of selling or leasing your minerals.

Get Started Today:

• Send Us Your Questions: Our experts are here to help.
• Fill Out Our Ownership Form: Let us evaluate your interests and provide clear guidance.
• Schedule a Consultation: Speak directly with our team to explore your options.

Understanding your mineral rights doesn’t have to be overwhelming. With Texas Energy Alliance, you gain the expertise and support needed to make informed decisions and maximize the value of your assets. Contact us today to get started!

How to Calculate Your Division of Interest (DOI)

Your Division of Interest (DOI), or payment decimal, determines how much royalty income you’ll receive from a well. Calculating your DOI depends on several key factors, which differ for traditional wells and multi-unit horizontal wells. Below, we break down the process for both scenarios.

 To calculate your DOI for a well other than a multi-unit horizontal well, you’ll need:

1. The number of net mineral acres (NMA) you own in the spacing unit.
2. Your royalty percentage.
3. The total number of acres in the spacing unit.

 Example Calculation:
If you own 40 net mineral acres with a 3/16 (0.1875) royalty in a 640-acre spacing unit, your DOI would be: 

40/640​×0.1875=0.011719 

 This means your DOI, or payment decimal, would be 0.011719. 

For multi-unit horizontal wells, the calculation is slightly more complex. You’ll need:

1. The number of net mineral acres (NMA) you own in the spacing unit.
2. Your royalty percentage.
3. The total number of acres in the spacing unit.
4. The percentage of the well attributed to your spacing unit, as outlined in the final multi-unit well order.

Example Calculation:
If you own 40 net mineral acres with a 3/16 (0.1875) royalty in a 640-acre spacing unit, and 43% of the well is attributed to your unit: 

40/640×0.1875=0.011719

 0.011719×0.43=0.00503917 

 Your DOI would be 0.00503917. 

Your DOI directly impacts the amount of royalty income you receive. Understanding how to calculate it ensures you have clarity on your payments and can verify the accuracy of your royalty statements.

At Texas Energy Alliance, we help mineral owners navigate the complexities of DOI calculations and royalty management. Whether you need assistance understanding your payments or calculating your DOI for a well, our experts are here to guide you.

Contact us today to learn more about maximizing the value of your mineral interests!

Deciphering Royalty Statements: A Guide for Texas and Oklahoma

Understanding royalty statements can be challenging, but it’s essential to ensure the figures provided by the oil company match the reported production and sales data. Each state has specific processes and resources available to help mineral owners verify volumes and values of oil and gas production.

In Texas, the Texas Comptroller of Public Accounts is responsible for collecting severance taxes on oil and gas production. Mineral owners can access production records through the Railroad Commission of Texas (RRC), which oversees the regulation and reporting of oil and gas operations.

1. Access Production Data:
    
   • Visit the Railroad Commission of Texas website (www.rrc.texas.gov).
   • Use the "Production Data Query" tool to find volumes and sales information for specific wells.
   • To search, you will need details such as the well name, lease number, or operator information.

1. Verify Sales and Taxes:
    
   • Check the severance tax records with the Texas Comptroller (www.comptroller.texas.gov) to confirm sales data and tax payments.

1. Understanding Key Information:
    
   • Look for discrepancies between your royalty statement and the reported data, such as volumes, values, and deductions.

In Oklahoma, the Oklahoma Tax Commission (OTC) collects production taxes and maintains records for oil and gas production, including volumes and values from individual wells.

1. Access Gross Production Data:
    
   • Contact the Oklahoma Tax Commission at (405) 521-3674 or visit their website (www.ok.gov/tax).
   • The OTC provides information about volumes and values of oil and gas production reported by operators.

1. Use Oklahoma Corporation Commission (OCC) Resources:
    
   • For gas volumes: Visit the OCC website (www.occeweb.com) to access gas production data.
   • For oil volumes: Oil production data is available in the Document Image Access database on the OCC website. 
     • To access this data, you will need the Production Unit Number (PUN) assigned to the lease by the OTC, as well as the purchaser number.

1. Production Reports:
    
   • Oil, gas, natural gas liquids, and reclaimed oil sales for the last 12 months can be found on the Oklahoma Tax Commission website.

Ensuring the accuracy of royalty statements helps:

• Verify that you’re being paid fairly for your minerals.
• Detect potential errors or discrepancies in reported production.
• Understand how deductions, taxes, and royalty percentages impact your payments.

At Texas Energy Alliance, we provide guidance and support to mineral owners in both Texas and Oklahoma. Whether you need help accessing production data, understanding your royalty statements, or verifying payment accuracy, our team is here to assist.

Contact us today for expert advice and personalized support!

A division order specifies the percentage of royalty an individual owns and serves as the document used by the oil company to distribute payment of proceeds. It is crucial for royalty owners to verify that their percentage is accurate before signing the order. If there is any uncertainty, they should consult with an attorney, banker, or another trusted expert to ensure the information is correct.

Payment of Proceeds from Oil or Gas Production

The payment of proceeds from oil or gas production is governed by the Production Revenue Standards Act (Title 52 O.S. Section 570.1, et seq.). This legislation mandates that the first payment to royalty owners must be made within six months from the date of the first sale. If payment is delayed beyond this timeframe, interest is owed to the royalty owner. The Act also outlines requirements for the timely payment of subsequent royalties after the initial payment. Disputes regarding payment are handled in District Court, which has jurisdiction over these matters.

Once payments begin, royalty checks are typically issued monthly, often around or on the last day of the month. For smaller interests, most companies wait until the accrued amount exceeds $100 before issuing a check.

Understanding Your Royalty Paystub

The Production Revenue Standards Act requires that each royalty payment includes specific information to ensure transparency and accuracy. Below is a list of the ten pieces of information that must be included with every royalty paystub:

1. Lease or Well Identification:
   The specific lease or well associated with the payment.
    
2. Sales Period:
   The month and year of the sales covered by the payment.
    
3. Production Volume:
   The total barrels of oil or MCF (thousand cubic feet) of gas attributed to the payment.
    
4. Price Details:
   The price per barrel or MCF, including any British Thermal Unit (BTU) adjustments for gas sold.
    
5. Taxes Paid:
   The total amount attributed to severance and other production taxes, excluding windfall profit taxes.
    
6. Net Value After Taxes:
   The net value of total sales after the deduction of taxes.
    
7. Owner’s Interest:
   The owner’s decimal interest in production from the property, carried out to at least six decimal places.
    
8. Gross Value of Sales:
   The owner’s share of the total value of sales before any deductions.
    
9. Net Share After Taxes:
   The owner’s share of the sales value after deducting production and severance taxes.
    
10. Deductions:
    A detailed list of the amount and purpose of any other deductions from the payment proceeds, which must be provided upon request by the owner.
     

By ensuring this information is present on your paystub, you can better understand your royalty payments and verify their accuracy. If any information is missing or unclear, consider reaching out to your operator or a knowledgeable professional for clarification.