Hello everyone, happy to be here.
I’m new to buying minerals/royalties and have been doing a lot of homework over the past month to avoid rookie mistakes.
For those of you who actively acquire interests, where do you usually source opportunities? • Online marketplaces (EnergyNet, etc.) • Brokers • Direct mail/mineral buying companies • Operator/landman networks
Also, is there anything you’d consider the closest thing to a “Zillow for minerals,” or is the market just too fragmented for that?
Use the “Road Kill” method. When an armadillo gets “run over” all the buzzards in the state go there! That’s the way the oil business works. Someone makes a good well and everyone will go there and start. Then someone will make a good well in another place and they will fly over there. 
The closest thing to a Zillow for minerals can be found in the Directories tab above. Pecan Tree out of Austin has a similar concept for valuation, but is not a buy/sell market. Those can be found on the online marketplaces.
You want to select a good place for excellent geology in the reservoirs, stacked reservoirs if possible, future potential for drilling, good transportation markets, state laws that protect the mineral owner. You can be a passive royalty owner or learn about working interest-big can of worms, but can be profitable (or not). Professional buyers are light years ahead of you in their knowledge of the buying and selling markets and their strategy. They have geologists, engineers, accountants, attorneys, big money backing, etc. on their side.
One of the largest conventions about buying is in Houston April 27-28. World Oilman’s Mineral & Royalty Conference. It is a good place to learn about what is going on in the really big money world of minerals. Not particularly promoting it, just letting you know about it.
Use the magnifying glass to find other similar answers from the last year or so. . Search “young adult” and “next generation” to see comments.
I mean this in the nicest way possible, you have no idea what you are doing and its a really bad decision aka the worst financial decision of your life. Take that money and put it into the stock market, youll come out way ahead.
I agree with your comment. Would you rather own your piece of mineral land than a piece of a large Oil or Gas company?
Investing in mineral rights tract by tract is difficult for the novice as they do not have the geologic, engineering or financial background to compete with the big companies. Another way to invest in minerals is through one of the mineral companies that are on the stock market. There are several.
Id never take advice from a message board on where I put my money. So take what Im about to say with a grain a salt. Having said that, Ive invested in numerous mineral and working interests funds and since you asked, Id rather invest in an AI stocks now over the 2 options you proposed. Just my 2 cents, best of luck to you
After being in this business as a landman, consultant, and professional mineral owner for 45 years, there is no easy method of acquisition. I have friends that wanted to invest with me over the years, but I have chosen to only deal with industry professionals. The reason, good deals do not get out of this business. There is plenty of capital to buy good deals. With that said, you can still find nuggets with diligent work.
It is a good idea to own mineral interest. It is a really bad idea to go out and try to compete with people that do this for a living. There is just no way that you are going to be able to locate, evaluate, negotiate and close on mineral interest against the professionals. If you really want to own additional mineral interest invest with a company that has all of the professionals in house. It can be either a private company or a public company. I only invest it private companies that I have a personal relationship with the principals.
I appreciate the candor.
I come from a data science background. I think that skill set can help in the minerals and royalties world, but I’m under no illusion that it makes me qualified. That’s why I’m here.
I’m trying to understand how people actually get started in this space. Is it uncommon because it’s capital intensive, knowledge intensive, and there are just too many barriers to entry?
So far I’ve talked to a few mineral deed brokers just to see what inventory looks like, and I haven’t seen a pitch that passes a basic DCF on reasonable assumptions.
If you were starting from scratch today, what would you do first? Any recommended learning path, deal sources, or “beginner mistakes” to avoid?
If I was starting from scratch today with no experience, Id run and wouldnt do it! Im just being straight up with you. There are so many PE groups that have gone out of business and lost millions buying minerals due to the prices they paid. The whole concept sounds great, but there are so many variables in buying mineral interests and theres no doubt youre going to overpay for minerals thus losing money. Im not sure what else I can say, but its a horrible idea in my opinion. Id invest your money in the stock market but if you really want to invest in minerals, invest in a mineral fund, doing it on your own is a good way to lose a lot of money
The common misperception on this forum is the mineral buyers always win…
Moderators of the forum always quick to chime in to “never sell.” When they have no idea the persons financial situation, when/if the owners acreage will be drilled, lump sum invested today and it’s value in 10 years when section is finally drilled…
First, stay away from brokers. Trying to compete with the direct marketing efforts of the many companies in mineral buying is a very expensive avenue. If you currently are a mineral owner with producing properties, I would focus on acquisitions within those properties. This may provide you with a modest information advantage. The downside is the lack of diversification.
Since you have a data science background, start building expert advisor notebooks in NotebookLM to act as a teaching resource. Here is a YouTube link that I find interesting from a land/legal perspective. https://www.youtube.com/@energylawprof
Nailed it! Im one of the few that goes against the grain and often get called out! Its a shrewd take I know, but the whole point is to make as much money as you can, not hold on to minerals because you inheritted them for sentimental value.
Everything hinges on scale. If you are looking to deploy 100+/-K… forget about it. You need outside help to source a risk-adjusted basket of interests that will produce returns and hold upside, option value. Oil biz (minerals, royalties, op or non-op) is risky biz. What is your beta? The Spy? It has returned roughly 14% annualized over past decade. From a risk-adjusted perspective, you need double that in PDP value with enough PUD optionality to generate 2.5-4X MOIC over desired investment horizon. Decline curve analysis (DCA) in conjunction discounted cash flow analysis (DCF) is how it is done from an engineering perspective. But you need specific geologic/reservoir/basin knowledge to even get close. Price risk is virtually impossible to model. Add in title, sourcing deals, legal fees- you will never match the hurdle rate in the 100k-400K range. If you are too big, say 100MM+. You are too late to compete with all the capital and expertise in this industry.
However, and (IMHO) there is a sweet spot in the .5-10MM range where you can make it work. You need good help though. You can’t outsource every part of the due diligence necessary to not screw it up. An engineering firm can only put a stamp on a deal at a P90 value (meaning 90% probability). Good luck transacting that way. You either must understand these plays and build type curves with different probabilistic risk profiles yourself or find someone who can explain to you what that means for transacting. Buying good deals usually happens from the ground up. If you are small and nimble- the secondary markets occasionally have good deals that can be layered into a portfolio. Good luck transacting at a P90 for any deal worth its salt especially if anybody in the game has already seen it. Finding someone with a skillset that covers all of the above is a needle in a haystack in this business. Seems like you understand the concepts and have some investing acumen. You can easily find yourself in the deep end of the pool though. After 20 yrs industry experience- I jumped in the pool to get back to my financial roots. Even then, it took me some time and (mistakes) to figure out how to source, close, right-size or warehouse deals, lay off roots and build a portfolio of diverse interest that can generate the right return profile. I did this in conjunction with some family money that wanted (partially) out of traditional equity or real estate accounts/funds. We setup a “club model” as opposed to a fund. I still haveto work my consulting and mineral management gig on the side because the most cost-effective way to do this is having someone run the show that is willing to take payment in-kind. That doesn’t always add up to fast money but the upside can be tremendous. Depending on risk tolerance build something under good operators with 50-60% PDP value/20-30% PDP deals w/ white space, (ducs or permits already attached or at least good economics that will encourage infill drilling), and then take some small swings at new plays on the cheap. Or be like the industry guys and take an inhouse land job then go work for the royalty shop down the street (and take their drill schedule with you lol)
I inherited mineral rights from both parents (split with the other heir). I live in another state, and I receive royalties from a natural gas well in Oklahoma. The companies that send me checks don’t seem to be very well run. In 2024, my checks stopped in May, and I didn’t notice until this April of 2025 when I was doing my 2024 taxes. Evidently they needed a W-9 from me, but never communicated that, just simply stopped paying my royalties. (It tooks several phone calls and emails to figure this out.) I finally got the rest of these 2024 royalties in 2025 and that has pushed my royalty income over $1000 for 2025, and I need to now do an Oklahoma State Tax Return. The other heir in my family STILL hasn’t received their 2024 royalties. To me, it’s too much hassle for around $1000 a year. I don’t really understand all the costs that are subtracted (ie, the total earnings will be something like $980, but they check will be for $750). I don’t know which costs are actual tax deductions. I do understand depletion, and have taken it every year. I inherited about 7 years ago. I am thinking of selling, but that looks complicated as well, and I have no idea of the cost basis at the time of my parent’s death, so figuring out capital gains is going to be difficult.
Yes, I would rather have inherited a position in a good S&P 500 index fund. It would certainly be easier to manage.The constant changing in the companies that send me checks is annoying.