One Less Worry in the World: The Overlooked Advantage of Selling Mineral Rights

In deciding whether to sell or lease your mineral rights, you look at the pros and cons of either, and weigh what pros you desire to have and what cons you can tolerate.

In the case of selling, there is the advantage of getting an immediate sum that may be big enough to give you full financial flexibility. But it is not without disadvantages. Selling can result into bigger taxes, and there are instances where leasing can lead to bigger money, so there is the lost opportunity there. Also, according to the website of The Mineral Auction, you may encounter problems in the selling process, like being vulnerable to buyers who have below marker price offers.

In the case of leasing, there is the advantage of gaining control. This can be done through agreements and contracts with the company who is willing to lease your mineral rights. Also, as said earlier, there is a possibility that leasing can amount to more money when compared to outright selling, like when your property has been more productive than expected. The disadvantage, however, is that you are at risk of fluctuating market values that may decrease your royalties.

There is no better option, in the absolute sense. The better option will always depend on the mineral rights owner’s financial situation, reason for putting the rights available for the market, and preferences. But there is one advantage of selling that nobody talks about, even though it can arguably make or break an owner’s decision.

If you opt to sell your mineral rights, you are completely releasing yourself from the responsibility over the minerals. It is just like selling anything else. After selling, the thing doesn’t belong to you anymore, so it is one less worry in the world. The best part about that is that you even gained money from it – a huge sum at that.

You cannot say the same thing for leasing. In fact, leasing is the exact opposite. It gives you one more worry in the world. You have to think about the risks and how their rise may influence your financial situation. It is true that in some instances leasing can get you more money, but is it really worth the try, when it means that you have to constantly deal with the minerals? This is compared to the fact that, the alternative, selling mineral rights, completely disconnects you from the minerals. This may make selling a more attractive option.