Buckhead Energy buys Alabama royalty interests, ORRIs, and NPRIs with our own capital — Black Warrior Basin coalbed methane, southwest Alabama Smackover oil, and legacy conventional production. Free written offer, zero fees or commissions, closing in 30–45 days.
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Get Your Free Alabama Royalty OfferQuick Answer To sell oil and gas royalties in Alabama: gather your division orders and recent check stubs, request a written offer from a direct buyer, and close by notarized conveyance recorded in the county where the minerals sit. Alabama stacks two severance levies — a privilege tax and a production tax — that together commonly reach 8% on onshore production, and the owner bears them in proportion to ownership. In exchange, Alabama inverts the usual bargain: both producing and non-producing mineral and royalty interests are exempt from all ad valorem tax, replaced by a one-time documentary tax paid at recording. Alabama has no dormant mineral act.
There is no single "best" royalty buyer for every Alabama owner, but four filters separate a serious buyer from an intermediary. Is the buyer using its own capital? Will they put the offer and its reasoning in writing? Who pays title and closing costs? And does the buyer model both severance layers? Alabama's privilege tax and production tax are collected together on one return but are separate levies at separate rates, and the applicable tier depends on when the well was permitted and how much it makes. A buyer applying a single generic rate is not modeling your net. Buckhead Energy is a direct buyer, buys with its own funds, and pays the title costs.
The classic royalty under a lease on your Alabama minerals — monthly checks from operator production, free of drilling and operating costs.
Carved out of the working interest — common for landmen, geologists, and dealmakers. ORRIs expire with their lease, which makes timing a real consideration. ORRI guide →
Royalty without executive rights or bonus — often inherited and misunderstood. Fully sellable. NPRI guide →
Producing or recently shut-in, whole or fractional, one well or many counties — including inherited interests still in an estate (we handle heirship).
In almost every state, your oil & gas royalty is set by your lease — not by statute. There is no government-set royalty rate for privately negotiated leases.
An unleased owner is guaranteed a cost-free 3/16 (18.75%) of production "in all events," with the other 13/16 treated as cost-bearing working interest subject to costs and up to a 150% risk fee.
Source: Ala. Code § 9-17-13(c)(4)
Typical negotiated lease royalty (market convention, not law): Across the U.S., negotiated oil & gas leases have historically run from 1/8 (12.5%) at the low end to 1/4 (25%) in the most competitive plays, with 3/16 (18.75%) and 1/5 (20%) common in active basins. Your actual rate depends on the play, the operator, the competition for your acreage, and when you signed — not on any state rate.
Alabama collects a privilege tax and a production tax together on one return. Most onshore production carries 6% privilege plus 2% production for 8% combined; the statutory onshore maximum is 10%. The tax is levied on producers in proportion to their ownership at severance, so a royalty owner bears a proportionate share:
Source: Alabama Dept. of Revenue — Severance Taxes Administered
Source: Alabama Dept. of Revenue — Severance Taxes Administered
Source: Alabama Dept. of Revenue — Oil and Gas Severance Tax FAQ
Reduced 3% and 2% privilege tiers apply to wells permitted in defined statutory windows, and an 8% privilege rate applies to categories outside the post-1988 onshore rules. Offshore rates are separate and are not stated here because the Department publishes conflicting figures for deep-offshore production. Confirm your own position with a CPA — this is published reference, not tax advice.
Alabama inverts the bargain mineral owners know from Texas and Oklahoma. Producing mineral rights, leases in production, and oil or gas under producing properties are exempt from all state, county, and municipal ad valorem taxation, and the exemption extends to an entire Board-established drilling unit on production from any one well. Non-producing severed interests — including royalty interests — are separately exempted from all state, county, municipal, school-district, and other district ad valorem tax. The trade is a one-time mineral documentary tax paid at recording, running a few cents per mineral or royalty acre depending on the primary term.
A severed Alabama mineral or royalty interest does not lapse, revert, or vest in the surface owner from non-use, however many decades pass, and there is no statutory notice-and-claim preservation filing to make. Alabama also has no general marketable record title act. Severed minerals can in principle be lost by adverse possession of the mineral estate itself, which requires actual, notorious, exclusive, continuous, and hostile possession of the minerals for the statutory period — surface use alone does not suffice.
Alabama is a rectangular-survey state, but unusually for its size it is surveyed from two principal meridians: the Huntsville Meridian governs the northern district and the St. Stephens Meridian the southern. The two systems abut across mid-state, producing an irregular junction where closure gaps and odd fractional sections should be expected. Metes-and-bounds calls should be anticipated inside the Spanish and British colonial land grants along the Mobile-Tensaw and lower Tombigbee corridor.
The State Oil and Gas Board permits Alabama wells, establishes drilling units, and publishes the production records we check on every Alabama evaluation.
Northwest Alabama — the state's Paleozoic basin and coalbed methane province, with thousands of shallow CBM wells across Tuscaloosa, Jefferson, Pickens, Fayette, and neighboring counties.
Southwest Alabama — the Jurassic Smackover trend producing from 12,000 to 20,000 feet across Escambia, Conecuh, Monroe, Choctaw, Clarke, and Washington.
Offshore and state waters — the largest natural gas field east of the Mississippi. Note this sits on state-owned submerged lands, so that royalty flows to the state rather than to private owners.
Mobile and Choctaw counties — Alabama's only giant oil field and its 1944 discovery field, both still active.
Active Alabama royalty counties include:
Cheap to hold, but taxed at severance: Alabama charges no annual property tax on your interest, so holding costs nothing — but the stacked privilege and production taxes take their share off every check.
Coalbed methane is mature: Black Warrior CBM development is decades old and well past peak. Long-lived, but declining.
The biggest gas is not private: Alabama's largest gas resource sits under Mobile Bay on state-owned submerged land. A private Alabama royalty position is essentially an onshore proposition.
Before you sell — or decide not to — read your own income stream like a buyer would: your royalty statement line by line, the full royalty calculation chain, and your trend over the last year. Run your own numbers with our royalty calculator, ground-truth prices against live WTI & Henry Hub benchmarks. The more you know, the better our conversation.
Gather your division orders, three to twelve months of check stubs, and your lease if you have it. Request a written offer from a direct buyer, review the purchase and sale agreement, then close by notarized conveyance recorded in the county where the minerals sit. Buckhead Energy handles and pays for the Alabama title work and typically closes within 30 to 45 days.
No. Alabama exempts producing mineral rights, leases in production, and oil or gas under producing properties from all state, county, and municipal ad valorem taxation, and separately exempts non-producing severed interests including royalty interests from all such taxes. The trade is a one-time mineral documentary tax paid when the interest is recorded, running a few cents per mineral or royalty acre depending on the primary term.
No. Alabama has no dormant mineral act and no general marketable record title act, so a severed interest does not lapse from non-use however long it sits. Minerals can in principle be lost by adverse possession of the mineral estate itself, but that requires actual, notorious, exclusive, continuous, and hostile possession of the minerals — surface use alone does not count.
Yes. Partial conveyances are routine — many owners sell a fraction for liquidity and keep the rest. The deed simply describes the portion conveyed.
A royalty interest is the income stream only; mineral rights include the underlying ownership with leasing (executive) rights. Both are sellable. ORRIs (carved from leases, expiring with them) and NPRIs (royalty without bonus or executive rights) are royalty-type interests Buckhead purchases regularly.
Often, yes. Small persistent checks — especially from long-lived stripper wells — carry real present value, and administrative burden frequently outweighs modest income for scattered or inherited interests. A written offer prices the whole remaining stream at once.
This page is educational and is not legal, tax, or financial advice. Statutory rates are quoted from the linked issuing agency as of 2026-07-21 and can change by legislative action. Consult a qualified attorney and CPA about your own interest before selling.
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