How to find out Net Mineral Acres

General Mineral Rights Discussion
#1

Hi,

I'd like to know, if I was to go to the courthouse in the county of my mineral acres, would the documents show the exact net minerals owned on each tract, or does that have to be done by a lawyer to get a straight answer?


On my Mineral Warranty Deed, it only shows the land description of Township, Range, Sections and gross acres, and exact location within the section.

Why wouldn't mt Mineral Warranty Deed show the net acreage?


Over the years, we've held leases every 5 years with different companies, and we've noticed that from lease to lease, the net acreage varies.

I have a subscription to the NDRIN, but the document of my Mineral Warranty Deed is long before they posted documents. Mostly the documents I've found on NDRIN are from 2000 to current, but I've noticed a few documents listed prior to 2000, just not any of mine.

I really want to know the correct amount now, prior to signing onto a new lease, so that if a well is drilled, I will have correct compensation; also, if there isn't a well, for all future leasing years to come.

Thanks in advance to anyone that can help with answers.

#2

Snues:

I would think that the documents at the County Clerks office would provide the correct information regarding Net Minerals owned by an individual. We have leased the same acreage to two different companies and each of them indicated the same amount of net mineral acreage. I have never researched these records myself but I maintain the original transfer of records as was recorded in the early 2000's.

#3

Thanks Charles for the information.

My aunt has an original transfer of records, and ours is transferred from my mom; to 3 children. So us 3 share the portion that was mom's. However, ours is different from our aunt and is supposed to be the same, (of course multiplying each of ours, times 3, to get the total).

We've never really looked into it in previous leasing, but have realized the importance of it now.

I hope I can readily find the documents at the courthouse, if it's somewhat similar to the NDRIN for searching I should do ok. My grandpa was homestead owner, so there shouldn't be much history on it, aside from the leases over the years.

Thanks again.



charles s mallory said:

Snues:

I would think that the documents at the County Clerks office would provide the correct information regarding Net Minerals owned by an individual. We have leased the same acreage to two different companies and each of them indicated the same amount of net mineral acreage. I have never researched these records myself but I maintain the original transfer of records as was recorded in the early 2000's.

#4

The original mineral deed provided the names of owners of the gross mineral acres. Each time an original owner dies, the dilution of acres is according to how many and who the surviving heirs are for each original owners portion. In a few generations, the net mineral acres of the original grant can include hundreds of individuals. This chain of title information may and probably is not known to any official or recorded up to date. You will need to do a title search and hunt down the heirs by following the recording of known interests of the mineral deed. The best way to do this is to hire a Landman to do the research. Sometimes the net mineral acres of any individual can be very small, making it difficult for drillers to deal with large numbers of ego’s and uncooperative heirs. Therefore, sometimes a pool is created for royalty money to flow into and let each sliver heir prove their portion with documentation. I hope this helps…Thomas

#5

Hi Thomas,

I can count the heirs that have received these gross/net acres from my grandpa, on one hand, and my aunt and mom are still both living, yet very elderly, as were my grandparents when they passed. My mom chose to quit claim her minerals to her 3 children, years ago, in case anything should happen to her, and because she didn't enjoy the chase of leasing each time. I think my grandpas homestead was from the 1920's decade.

I just went to my local courthouse with my residential taxes and property location and checked with the recorder's office to see what it's like to research those books. It wasn't too intimidating, but the clerk mentioned it might be different at another courthouse, but likely to be similar.

I think I'm going to give it a try on my own, then if I can't find the data, I will look to hire a landman or lawyer.

Thanks for your help and suggestions, I'll repost after I see what I can find.


Thomas Mullins said:

The original mineral deed provided the names of owners of the gross mineral acres. Each time an original owner dies, the dilution of acres is according to how many and who the surviving heirs are for each original owners portion. In a few generations, the net mineral acres of the original grant can include hundreds of individuals. This chain of title information may and probably is not known to any official or recorded up to date. You will need to do a title search and hunt down the heirs by following the recording of known interests of the mineral deed. The best way to do this is to hire a Landman to do the research. Sometimes the net mineral acres of any individual can be very small, making it difficult for drillers to deal with large numbers of ego's and uncooperative heirs. Therefore, sometimes a pool is created for royalty money to flow into and let each sliver heir prove their portion with documentation. I hope this helps.....Thomas
#6

Hi Thomas,


It occurred to me, since the 1980's, we've only owned the minerals, not the surface acres; so that may make for more of a paperchase.


Thomas Mullins said:

The original mineral deed provided the names of owners of the gross mineral acres. Each time an original owner dies, the dilution of acres is according to how many and who the surviving heirs are for each original owners portion. In a few generations, the net mineral acres of the original grant can include hundreds of individuals. This chain of title information may and probably is not known to any official or recorded up to date. You will need to do a title search and hunt down the heirs by following the recording of known interests of the mineral deed. The best way to do this is to hire a Landman to do the research. Sometimes the net mineral acres of any individual can be very small, making it difficult for drillers to deal with large numbers of ego's and uncooperative heirs. Therefore, sometimes a pool is created for royalty money to flow into and let each sliver heir prove their portion with documentation. I hope this helps.....Thomas
#7

Dear Snues

You also need to know that a Quit Claim Deed does not convey interest. It only releases interest that may or maybe not exist. Quit Claim Deeds are good for removal of "clouds of Title" where someone's interest is in question. You will need an instrument of conveyance, such as an actual "Mineral Deed". Check to see if your mom's QC deed was recorded and recognized as a conveyance to her 3 children. Also, surface deeds and mineral deeds are all recorded the same way and have different conveyances....check the actual type of deed of record in your search....the best

#8

Hi Thomas,
The document I have from when she transferred it to us, is titled Mineral Warranty Deed. It lists each of the childrens names, as well as the land description, and gross acres, just not the net acres.

The paragragh after the land description says, To have and to hold unto the grantees, in equal undivided interests, and their heirs and assigns, forever, subject only to: prior conveyances, exceptions and reservations of record.

The paragraph after that is lengthy, but basically explains the ND Century Code 47-10-03.


Thomas Mullins said:

Dear Snues

You also need to know that a Quit Claim Deed does not convey interest. It only releases interest that may or maybe not exist. Quit Claim Deeds are good for removal of "clouds of Title" where someone's interest is in question. You will need an instrument of conveyance, such as an actual "Mineral Deed". Check to see if your mom's QC deed was recorded and recognized as a conveyance to her 3 children. Also, surface deeds and mineral deeds are all recorded the same way and have different conveyances....check the actual type of deed of record in your search....the best

#9

Dear Snues

Only gross mineral acres are stated on the Mineral Deed. This keeps all recordings focused on the original mineral deed. It also does not state consideration for conveyance. This usually keeps the tax folks from using the consideration as a basis of taxable value. It also protects sellers and buyers from using consideration in fixing values of other properties, thus bidding them upward.

#10

Snues,

If your grandfather was the original homesteader, this may be an relatively easy process. So if you're nearby go to the courthouse and give it a try. As you do the research, make a photocopy of every deed for your records. You'll be grateful you have those copies after you return home.

In essence you're researching up to the point it reached your name. Deed activity by any subsequent landowner is irrelevant to your search. So your research ends when you received title. Though depending upon how your family transfers were done, you may need to look into some estate papers besides this search through deeds. In this process it is also fairly easy for you to determine exactly what your Aunt (and other relatives) own.

1. Find the original US homestead patents. You'll want to see if the govt reserve any minerals.

2. Seek all deeds where your Grandfather, the homesteader, was a "Grantor". Some may be "mineral deeds", some may be deeds selling land which also conveyed minerals.

3. Track each owner's (your Mom, your Aunt,...?) activity as "Grantor" until it finally reached your name.

4. Then unless you've sold some your search is at an end.

Once you have all the deeds available, it is highly unlikely you'll find any "net acres" specified. Yet the language on the deeds allows you to determine what you own. If nothing else this is a great way to gain a better understanding of the business. Good Luck with the hunt!

#11

Hi Eastern MT,

If I make copies of all I can find up to it being in my name (I have all mine to date) and I'm unable to find the "net acres," would I be able to hire a lawyer that could tell me by reading them, or would he/she need to go to the courthouse and do more research?

Thanks for all the help I'm getting on this topic, I really appreciate it.


Eastern MT said:

Snues,

If your grandfather was the original homesteader, this may be an relatively easy process. So if you're nearby go to the courthouse and give it a try. As you do the research, make a photocopy of every deed for your records. You'll be grateful you have those copies after you return home.

In essence you're researching up to the point it reached your name. Deed activity by any subsequent landowner is irrelevant to your search. So your research ends when you received title. Though depending upon how your family transfers were done, you may need to look into some estate papers besides this search through deeds. In this process it is also fairly easy for you to determine exactly what your Aunt (and other relatives) own.

1. Find the original US homestead patents. You'll want to see if the govt reserve any minerals.

2. Seek all deeds where your Grandfather, the homesteader, was a "Grantor". Some may be "mineral deeds", some may be deeds selling land which also conveyed minerals.

3. Track each owner's (your Mom, your Aunt,...?) activity as "Grantor" until it finally reached your name.

4. Then unless you've sold some your search is at an end.

Once you have all the deeds available, it is highly unlikely you'll find any "net acres" specified. Yet the language on the deeds allows you to determine what you own. If nothing else this is a great way to gain a better understanding of the business. Good Luck with the hunt!

#12

Hi Thomas,

What makes me curious, is how does a landman discover how many net acres on any given lease, if it's not there. I do understand why its not on the Mineral Warranty Deed, but it should still have been spelled out, as the time my mom did the transfer.

What initially prompted me to post this topic is that I have 3 prior leases and now a current one thats being offered. I'm not wanting to sign until I have it figured out what the net acres are, as the past leases are each from different companies, and all have varying net acre amounts. My net acres mesh with what my 2 siblings have on their leases too, but not with my aunts. (given she has a whole share, and mine is 1/3 of a whole share)

I've also read on this post where somebody has asked why it takes so long to get first payment when their well becomes operational, and one of the reasons given, was that lawyers had to go verify exactly the amounts of net acres and to whom. I do understand most wells/land situations would be complicated with potentially hundreds of leases in play, but if they were 'accurate' at the get-go, why the need to double check? That tells me that its pretty easy for it to be in error.

My main goal, is to just make sure it's accurate from now on, so there is no doubt when a lease crosses my desk, that I know what I honestly have.

Thanks so much.


Thomas Mullins said:

Dear Snues

Only gross mineral acres are stated on the Mineral Deed. This keeps all recordings focused on the original mineral deed. It also does not state consideration for conveyance. This usually keeps the tax folks from using the consideration as a basis of taxable value. It also protects sellers and buyers from using consideration in fixing values of other properties, thus bidding them upward.

#13

Forgive my ignorance, but if you have the gross acreage.... and you know your percentage of ownership in the entire property, then you have the net mineral acres already... why do you need someone else to tell you what you own, or it be on the document?

Are "homesteads" that different from Texas? How much acreage are we talking about here that your grandfather owned?

And did he leave a will giving all the interest he owned to your grandmother, whom delivered/transferred the property out? Am I understanding this correctly?

Brandon Sneed

Landman

brandon@sneedinc.com

#14

Snues, yes hire a lawyer. That may be the best thing to do depending upon the size of your interest and the acres involved. Yet they won't necessarily need to return to the courthouse if you do a thorough search of the records yourself.

As to what "net acres" you own. It all depends upon what each prior owner kept...

A. The homesteader owns 100% of the minerals under the gross acres (unless govt kept them).

B. Anytime Grandpa sold some (land or minerals) he will appear in the records as a "Grantor". If he kept minerals in those transactions the deeds will indicate "one half", or "one quarter", or 75%, or 50%, etc... Then it is just a simple calculation to determine the NET acres.

Just as an example...

If he sold 320 acres of land, though "reserving one half" the minerals, HE kept 50% of the minerals under that.

So Grandpa kept 160 NET acres under that 320 gross acres.

In a later deed if he later gave "All" his minerals to his two daughters, then each one recieved 80 NET acres under that same 320 gross acres.

If your Mom deeded hers to you three siblings, then you and your two siblings each own 26.66 NET acres under that same 320 gross acres.

I hope this helps explain the process. If you're uncertain you should hire professional help with this, especially if there is production involved. However, if you're near the county seat I'd still recommend you go give the research a try. It is a great way to further your understanding of the process.

#15

To Charles, Thomas, Eastern MT, and Brandon,

Doing the happy dance here.

After a trip to the courthouse, and able to find all the documents, some were easy to interpret, others were not so easy.

I made copies of everything, took them to my lawyer, and there was an additional 68.55 net acres that should have been showing on moms portion, (divided by the 3 of us) 23.6 net acres each. Not a bad days work, when you consider the going rates of leasing.

Even paying the lawyer and my time and mileage to the courthouse, it's a glorious find.

How to explain the situation, I haven't any idea, but just happy to have it correct. Looking back at previous leases, there is one company that had it correct, the others were not.

Thanks for helping me out with my multiple questions and dilemma.

#16

Glad that you got it all taken care of, and the attorney was able to assist and get your dues corrected as well. Best of luck in the future.

#17