Why Sell Your Mineral Rights?

Selling your mineral rights allows you to realize current market value regardless of when your minerals produce and eliminates the complexity associated with managing your royalty rights and tax liability.

 

Oil and gas mineral rights can be valuable but carry a high degree of uncertainty. As a mineral owner, it is important that you understand your property's potential value and the risks associated with this kind of asset. One risk mitigating option is to sell a portion of your mineral rights. This alternative allows you to receive an upfront payment, while maintaining a significant portion of the potential upside.

 

The peace of mind that comes from getting that upfront check is a good reason for many. The upfront cash payment can be used to get ahead by paying off a mortgage, paying for a child's education, or beginning to build a nest egg for retirement. In addition, by keeping a portion of your mineral interests, you have the potential for a long term stream of future royalty checks.

 

Knowing the Risks

While it is true that some mineral owners will see significant profits from their minerals, and many property owners have heard stories about someone who has done very well, the fact is that many people will not see that royalty stream come their way.

 

Exploration for and production of oil and gas is a risky business. Oil and gas price volatility means that leasing and drilling activity occurs at a fast pace in a high price environment, but when prices drop, development activity comes to a standstill, which is why we think of this as a boom bust industry. That said, when the downturn comes, the phone stops ringing.

 

In a low price environment, operators will slow the pace of drilling activity and may not place an owner's property in a drilling unit for several years after leasing, and some acreage may never become part of a drilling unit. What Siltstone offers is a way to ensure that you see an upfront payment for a portion of your mineral interests right now, essentially reducing the downside risk associated with a low activity environment.

 

Why We Do What We Do

Siltstone is willing to pay current market value for mineral rights and assume a significant portion of the risk associated with future uncertainty. Siltstone assumes this risk in part to benefit from potential positive price movements and economies of scale. Through our partnership structure, we are able use investor capital to build significant mineral acreage positions throughout active areas. Consequently, we expect to acquire an acreage position that will allow us to manage the potential of losses with a portion of highly productive properties in our portfolio.

 

This process is both expensive and labor intensive, which requires a high level of diligence to properly manage this risk.

 

The Takeaway

If you, as a mineral owner, would like to monetize all or a portion of your mineral interests, consider Siltstone as your buyer of choice. Simply fill out our form to request a proposal, and we will contact you shortly with an offer to help you make the most out of your property.