Royalties and the Deed

Shales Bakken Shale
#1

How does an oil company determine the percentage of royalties each person owns? Is that something that is typically recorded on the deed in the court house? If a land deed was sold and there is no documentation on the original deed regarding the royalties, does that mean that the new owner of the land also acquires all royalties?

My mother bought the land years ago from her parents. They told her that she had all the minerals but the royalties would be split 5 ways between her siblings. We have a copy of the original transfer of the deed and nowhere is it recorded that the royalties should be split. Is there another location that it would be documented?

#2

Mary:

The % of royalties are stated on the lease agreement. The deed on file at the Coutny Clerks office will not reflect this information as it will reflect the # of mineral acres you have and the lease description. The mineral lease will be subject to the % royalty negotiated at the beginning of the lease and will remain in effect until the lease expires or a well is drilled where it will be untilized to figure your royalty payment. In regards to the # of mineral acres your mother owns, this should be on file at the County Clerks office.

#3

I guess I wasn't clear in what I was asking. I am refering to the percent of ownership of the royalites and not the leasing percent negotioated. According to what we thought we knew, the minerals were undivided and went to my parents. The royalites on the other hand were supposed to be split 5 ways. However, the documentation of the original transfer of land, minerals, royalties does not state anything other that my parents paid a nominal fee for the land and the minerals. We would have thought if the royalites were to be split 5 ways, it would have stated that in the original document or in some other document. My dad kept meticulous records and he did not have anything specifying the royalty division. Would it be located in another type of document in the court house?

#4

Mary:

I believe this type of information would be contained in the Will (if there was one). If not, you might want to seek the services of an estate attorney in order to sort through the records which are currently available. You stated that the royalties were supposed to be split 5 ways but where in writing was this notated. If no written evidence is found, this is where legal counsel would be helpful in solving your problem. Hope this helps or maybe someone with this similiar situation can add additional light.

#5

Mary,

You will have one of two things. Either a transfer of mineral rights on file at the court house or a will stating the split to each sibling. If all else fails there are attorneys that can do title runs for you.

#6

I just found out there was not a will left and we have no records of the split. My parents purchased the land with the minerals and on the deed no split was mentioned. So we are thinking that they also own all the royalties since no split was recorded.

#7

Mary,

You need to invest in a local attorney doing a title run for you or spend the time in the courthouse doing the title search yourself. The mineral rights do NOT automatically change ownership with the purchase of the house and properties. If there is no designation regarding mineral rights there is a process the land owner can go through to lay claim to the minerals although it does take several weeks and you have to place an add in your local paper stating your intentions.

Regardless of all you will have to be able to show ownership of mineral rights and designations.

#8

Mineral rights are recorded separately. Check with your clerk & recorder and have them tell you what is on the mineral records for each parcel of land/mineral property. This whould tell you the percentage of ownership. The actual lease willspell out the % of royalties that would be paid for produced oil/gas. Be sure that the mineral rights were not transfered to the new property owner. If this has happened, get a lawyer if you can prove your case. Remember that verbal declarations are virtually worthless is these cases unless there is a survivor that has an interest and is willing to verifty your point of ownership. In this case a Mineral Trust would have avoided most of these problems and the transfer would have been autromatic.

#9