Understanding your options as a mineral owner.
Get Your Free Mineral ValuationAs a mineral rights owner, you have two primary options for monetizing your assets: leasing to an oil and gas company or selling to a mineral buyer. Each path offers distinct advantages depending on your financial goals, timeline, and personal circumstances.
Understanding the key differences helps you make an informed decision that aligns with your needs.
When you lease your mineral rights, you grant an oil and gas company the right to explore for and produce hydrocarbons from your property for a specified period. In exchange, you receive:
An upfront payment per net mineral acre when you sign the lease.
A percentage of production revenue (typically 1/8 to 1/4) if and when wells produce.
You continue to own the minerals and can lease again or sell in the future.
When you sell your mineral rights, you transfer permanent ownership to a buyer in exchange for a lump sum payment. The transaction is final—the buyer assumes all future benefits and responsibilities of ownership.
Immediate cash payment at closing
Clean transfer of all ownership responsibilities
No ongoing management or paperwork
Ownership of the mineral estate
Future royalty payments
Future lease bonus payments
| Factor | Leasing | Selling |
|---|---|---|
| Ownership | You retain ownership | Ownership transfers to buyer |
| Payment | Bonus + royalties over time | Lump sum at closing |
| Duration | Temporary (lease term) | Permanent |
| Management | Ongoing paperwork required | No further involvement |
| Future Upside | You benefit from new wells | Buyer benefits from new wells |
Many mineral owners find that selling is the right choice for their situation:
Need for liquidity: When you need funds for major expenses, investments, or opportunities
Estate simplification: When you want to simplify inheritance for heirs
Out-of-state ownership: When managing distant assets becomes burdensome
Small interests: When fractional interests don't justify ongoing management
Certainty preference: When you prefer guaranteed cash over uncertain future royalties
Life changes: Retirement, health needs, or major transitions
Get a free, no-obligation valuation to understand your options.
Request Your Free ValuationLeasing grants an oil company temporary rights to explore and produce from your minerals in exchange for bonus payments and royalties. You retain ownership. Selling transfers permanent ownership to a buyer in exchange for a lump sum payment. You no longer own the minerals or receive future royalties.
Yes, you can sell leased mineral rights. The buyer purchases your ownership subject to the existing lease. They will receive future royalties and any bonus payments when the lease renews or a new lease is signed. Many buyers actively seek leased minerals, especially those with producing wells.
Yes, when you sell mineral rights, the buyer receives all future royalty payments. However, you receive a lump sum that represents the present value of those future payments. Many owners prefer certain cash today over uncertain royalties spread over decades.
Selling provides immediate liquidity, eliminates ongoing management responsibilities, removes uncertainty about future production, simplifies estate planning, and converts a speculative asset into guaranteed cash. It's particularly beneficial for owners who need funds now or prefer not to manage mineral assets long-term.
Primary lease terms typically range from 3 to 5 years. If production is established, the lease continues as long as the well produces in paying quantities—this is called being 'held by production' (HBP). Some leases have been held for decades through continuous production.
Disclaimer: This information is for educational purposes only and should not be considered legal, tax, or financial advice. Consult with qualified professionals before making decisions about your mineral rights.