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ATB
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# Posted: 15 Mar 2012 16:05 - Edited by: ATB
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Still working on acreage purchase getting close but the 60 acres I am looking to buy in Northern Michigan the mineral rights are unknown! There are no wells I have seen in the area. My RE Agent says hardly anyone in Northern Michigan owns them or knows who owns them which is crazy!
Is it a big deal not owning the mineral rights?
Thanks
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wakeslayer
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# Posted: 15 Mar 2012 16:17
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Not unless you strike gold on your land. Mum's the word, then.
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toyota_mdt_tech
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# Posted: 15 Mar 2012 18:34
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The owner of the mineral rights can come in and start mining. Not much you can do. I own my mineral rights and timber rights on my place.
I guess if no one knows who owns them, they they dont own them. But you do.
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VC_fan
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# Posted: 15 Mar 2012 20:56
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I know that in large swaths of the West, it's not really possible to own the mineral rights because they were sold in huge parcels long ago while that part of the country was initially being exploited. Where our shack is (southeastern Ohio) it's become a huge deal right now because of talk of gas discoveries and extraction enabled by fracking. Land without mineral rights has always been worth half or less what land with rights is worth; right now, there seems to be a minor land rush going on with the most valuable thing being the mineral rights (i.e., it almost seems like the land itself is secondary). None of that makes much sense to me.
Toyota_mdt_tech said the key thing - if you don't own the mineral rights, whoever does has every right to come in and destroy your property looking for minerals. Unless the norm is to not own them (as it sounds like it may be where you are) I'd never even consider land without the associated rights.
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TomChum
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# Posted: 16 Mar 2012 00:59 - Edited by: TomChum
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Quoting: VC_fan has every right to come in and destroy your property looking for minerals
The way it was explained to me, from a commercial properties real estate agent, was that they could tunnel under your property, but they could not disturb your property. And that if they did disturb it they are liable. Consequently they don't do anything under it unless its so deep it does not expose the company to liabilities.
He also said that in the west, generally if you've got mineral rights that means somebody has decided that there's nothing there.
I have never heard of someones property being destroyed or even altered due to mineral rights. But I haven't heard every story.
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VC_fan
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# Posted: 16 Mar 2012 07:17
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Just curious - TomChum, do they strip mine in your area? As of about 30 years ago they are indeed required to "reclaim" the land. The most cost effective way to do this is to return it to sustainable pasture. So the trees are stripped, top soil removed, coal extracted, and then the mining company is required to restore the contour and revegetate it. During that years-long period between stripping and revegetating the land would appear "destroyed" to most folks.
I also have not heard of it happening in my area and there are a lot of reclaimed strip mines. I could have overgeneralized but I have bought and sold several properties and never learned anything contrary to that explanation. I have a beautiful piece of land now that was still undergoing reclamation when I bought it. It's beautiful in its own right but a very different place than it would have been before it was raped and pillaged (my opinion).
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Martian
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# Posted: 16 Mar 2012 08:56
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Mineral rights contracts are part of the records on your land at the court house. That's why, during energy booms, landmen flock to the courthouse and pour over records.
Don't believe anything your realtor tells you! They are trying to sell you something. Verify all the information you get from a realtor.
Tom
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Phil
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# Posted: 17 Mar 2012 12:36
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The Osage tribe owns all mineral rights in my neck of the woods. We mainly see oil leasing instead of mining but there are strict rules about what they can and can't do, and oil companies are heavily fined by the powers that be when they do not comply or create a mess.
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Montanan
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# Posted: 17 Mar 2012 15:47
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Our land is a former mining claim (silver.) We own the mineral rights from the surface down 200' and a mining company owns the rights below that level. So, I guess that means they could theoretically tunnel under?
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TomChum
Member
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# Posted: 17 Mar 2012 23:52
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Quoting: VC_fan I have a beautiful piece of land now that was still undergoing reclamation when I bought it
Did the mining company own it during the time when it was strip-mined?
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SamH
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# Posted: 18 Mar 2012 11:47
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It varies from state to state, but here and in a lot of places, if 51% the mineral rights in a section are owned or leased by someone, they can basically do anything they want to to get those minerals. When they get 51% of the rights leased or bought up, they can then go through a process called integration. If you are one of the 49% that didn't lease and you don't want to, your out of luck. If your land is integrated you have the choice of leasing your mineral rights or you have to participate in the drilling or mining process, which means if you own 64 acres ( 10% of the section) you have to pay 10% of the cost of drilling or mining and 10% of shut down costs when it is over on everything they do in that section. Unless you got a pile of money, you can't afford to participate. Here participations costs thousands to tens of thousands of dollars, per acre, not counting shut down costs, that's just up front. You could make money off participating, but if it 's not a profitable endeavor, you could lose big time. If they get 51% of the acreage leased in your section, they control that section and in a lot of states, like AR, surface owners have almost no right to stop them from doing basically anything they please. The only control a landowner has is if you own over 50% of a section, you own the mineral rights and you don't lease, then you can keep them off your land, otherwise you can't. I live in the middle of a large natural gas play, I can see 2 drilling rigs from my window, right now. I'm not against them drilling here, I'm making some money off it and I think they are actually doing a good job on the environmental side, but I hate the fact that surface owners have almost no right to control what happens on their land.
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VC_fan
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# Posted: 18 Mar 2012 19:24
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To Tom Chum - FYI (and I didn't mean to be a smart alec by asking if they strip mined where you were - there are people on this forum from all over and some who may actually not be familiar with the practice). This land, along with literallly about 1/4 of the county was owned by someone (call him Mr. Smith). Mr. Smith sold a lot of his holdings to a mining company but carried part of the mortgage. When the mining company went bankrupt Mr. Smith got the land back. We purchased it directly from Mr. Smith. No, I don't know who paid for the reclamation or if it was funded by the bond that the law requires be posted in order to operate. Here, (Ohio) there's a 5 year waiting period after the reclamation is complete before the bond is released and before there can be any construction. We were about 1.5 years from that final release when we purchased.
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turkeyhunter
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# Posted: 18 Mar 2012 22:19
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i bought a house and 5 acres back in the early 80's----bought it through a local bank--had a title search-i knew the mica minning rights were sold--no one was minning mica back then---so no problem--sold the place 5 years later and royal PIA =-=--had to get a quick claim deed from a minning company in CA--who was out of business--no one minned mica anymore!!!!---lots of lawyers made $$$ on this sell--- but a out of town bank would now loan money for the house and property with the minning rights sold--- it took 4 months to get it settled--- and i had bought another house------
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neb
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# Posted: 18 Mar 2012 22:50 - Edited by: neb
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In the area I live if you bought land in the last 50 years you wouldn't get mineral rights with any land you bought. Oil is all over here and most people that have the rights don't live on the land or even live in the state. The lands I bought through the year I never got any rights and that is a norm here. My wife does own some rights from land her great grand parents owned and the land does have wells on them. The minerals on most lands are splite many many ways from family members through time. Minerals here cost you more then the land itself
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Anonymous
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# Posted: 17 Jun 2012 01:00
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If you never watched Boom Town. I would recommend it. It is a tv show that shows the affects to towns, people, and land during the oil boom in North Dakota. Most people there do not own the mineral rights and the owners are destroying the land getting to the oil.
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