Can anyone explain to me in the simplest terms the difference between holding mineral rights and a royalty interest?
Finding out we are heirs to a royalty interest held by great grandparents. Got an attorney handling the case - but not able to get short and simple answers to anything from them - and paying by the hour I think I will skip asking them again.
My thought was this - mineral rights mean simply you hold the tangible rights. You hold the right to sell (or not) a specific portion of minerals in a parcel. You are in turn required to take action to protect your interest or the physical land owner can seek to reunite the minerals with their property if they are deemed “abandoned” in Ohio under the DMA.
Royalty interest is different in that you are bound by the actions of the mineral rights holder.You are entitled to a percentage of the PROCEEDS from any sale of minerals named in the royalty interest. If nothing is ever developed - you get nothing. Since you have no direct control over the minerals (and are bound by the whim of the mineral owner and their decision of if/when to allow development and by whom) your interest cannot be “abandoned” for lack of active participation (as you are a passive holder - not holding right of direct participation).
Tell me where I am wrong here - state is Ohio. This is of course a very old interest where when the family farm was sold - a percentage of any future profits from sale of minerals was reserved in protection of possible future development.