Options for managing a small portfolio of mineral rights

#1

I’m a beneficiary to an estate that includes mineral rights that has now been divided up through a couple of generations leaving only 20 shares divided between 5 beneficiaries. Up until now this has been managed by US Trust. However, due to the small number of shares and the number of benefactors, US Trust is no longer interested in managing this. Are there management companies that will work with small clients or what other options are there for handling this. Thanks!

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#2

Have you tried contacting a mineral asset management firm that’s located in the same vicinity as your minerals? Alternatively, you could find a landman that you trust to handle things for you on an as-needed basis.

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#3

Another option is doing it yourself. Many of us do that for our families. There are classes out there through NARO and other institutions that can help you get started and experienced folks to walk you along to get started.

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#4

Thanks for your ideas!

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#5

Also, various banks will also manage trusts. I know that Wells Fargo and Frost do it and I expect Bank of Oklahoma might as well. They will charge anywhere between 6-8% of the gross (last time I checked). Or you can “hire” a family member to become the expert and pay that person.

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#6

Some states, like Oklahoma, make managing minerals is painless since taxes are paid before royalties. However, Texas requires payment by owners to the county for taxes.

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#7

Thanks! Following up on this question, as I learn more on this. We hold over 100 wells on 44 properties, only 20 are producing and 24 are non producing. Is that typical? Or is there room for improvement?

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#8

Depending upon what state and county you are in, that can be typical or not. Room for improvement comes with increased leasing and drilling. Sometimes, you can do a multi-tract deal if a company is interested in one property and you have another close by.

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#9

Thanks! I was thinking of presenting the idea that myself or another sibling offer to get certified to manage these and build the case that perhaps we could do it better. (But sounds like I need to find out more, like where these are located for one ;-).

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#10

Lots of us manage our own. First thing to do is find out what you own.

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