Types of Mineral Ownership

Types of Mineral Ownership

There are 4 different types of owners who can own mineral rights, including royalty owners, overriding royalty interest owners, non-operational working interest mineral ownersand working interest owners.

Royalty owners are individuals or entities who own a percentage of the revenue generated from the production of minerals on a property. They typically do not have any operational control over the property, but instead receive a share of the profits from the sale of the extracted minerals.

Overriding royalty interest owners on the other hand, own a percentage of the revenue generated from the production of minerals on a property, but their interest is limited to a specific depth, period of time or until a certain amount of money has been earned.

Non-operational working interest mineral owners are individuals or entities who own a percentage of the mineral rights on a property but do not have any operational control over the property. They are responsible for sharing the costs associated with exploration, drilling, and production, but they are not involved in the day-to-day operations of the property.

Working interest owners are individuals or entities who own a percentage of the actual mineral rights on a property and are responsible for the costs associated with exploration, drilling, and production. They have a direct say in the operations of the property and receive a share of the profits based on their percentage of ownership.

Overall, the type of ownership of mineral rights depends on the specific terms of the agreement between the parties involved and can vary based on the interests and responsibilities of each party.