Mineral Rights? (War, Albright: sales, insurance, lawyers)

[Papachops]

As some of you know I do have plans on buying some land in WV. It seems that most properties don't convey the mineral rights. What is the reason for that, and is there a way to purchase them back? I'm afraid I don't know much about the subject, but when I have the family homestead I'll be damned if someone is just gonna decide to dig a hole in my yard. Thanks

[harborlady]

I'll warn you, I'm not a lawyer, and I'm a newbie to WV- I can only share with you the jist I got from folks when I asked the same question. I'd hate to steer you wrong, and others will likely be more helpful as the thread progresses.

Nothing about mineral rights should prevent you from establishing septic systems, well water, geothermal heat system, or use for timbering/farming purposes.

Mineral rights pertain to 6 inches below the ground. If you find gold in them thar hills of yours, it isn't yours. Pre existing gas wells are an indication that the land has already been surveyed for what commercial benefits can be derived from it. What happens when a massive coal seam is under your livingroom chair? Good question.

It's not coals objective to run people out of their homes and cause a big stink. The economics of bad blood are something they don't need anymore than homeowners do. I've read of situations where proximal mining operations harmed people's property values via mud slides or some such thing in kentucky or tennessee- the company was held liable- but how restitution plays out is another animal. I've never seen anyone restored whole by an insurance check, and I guess that's an unrealistic expectation we have in society.

I've read of stories on the wv southern tier- a tiny town being bought out- some stubbornly insisting their family house is their own (even if it kills them). There isn't much left of this town, and by now I think the post office is gone- I don't even recall the name. I saw pictures of it on google earth and it was hideous. The smarter people took the money and relocated. The stubborn ones suffered immensely. The house had been in the family for at least 3 generations and I doubt it was fit to be moved without crumbling.

Perhaps someone knows of a way to contact the owners of the mineral rights to buy them back? Or even ask them what their future intentions are for a given tract of land? I still mean to buy some acreage and do a custom build someday, but I'm not sure if there is a smart way to go about selecting those properties without finding out the hard way. Anybody know?

[David Kennedy]

Our people were farmers...saw the value of the land in the soil and the trees. In the 1880's most of them sold their coal rights and gas and oil rights...most got a whopping 2 or 3 thousand dollars for that. Built a big house from Sears or Monty Ward and laid back with a smile on there faces...never knew that what they were giving away was worth millions of dollars..and having free gas to heat and cook with was just fine.

In 1988 two old maids died who had an interest in a gas well near us and I went to the tax sale to try to buy up that interest. I bade $3500 on the one old maids interest and $8,000 on the others...thinking that in a lifetime the gas shared among several homes in that area would be worth it...On the second interest, I was a little hot and bid the lein to a price that I became uncomfortable with...that $8,000.
At $8,001 the property was sold to the same gentleman in a black suit...Waco Oil and Gas.

At the end of the bidding he came over and said hello...I asked him why he wanted that property so badly...he said, "They are all the same, whatever you bid, I was going to bid higher and own it because my funds are unlimited...yours are not....I've picked up every property today at the minimum price...spending a little money to buy that property was insignificant..."

Buying back the mineral rights...never happen...worth a fortune because of the time period involved...a 100 years into the future...will only be more valuable..
We are lucky to have the gas rights and they are not unlimited...about 200,000 cu ft per year..keeps a person from heating the barns and the hen houses..and some have done exactly that..

[harborlady]

DK if you don't mind me asking- what was the nature of the bidding process for that sale? Sealed bids, or open auction set up?

[David Kennedy]

150 people crowded into a tiny room at the Courthouse on Nov. 15th...a tax deputy stands and call out a number of the property...done in order of the newspaper public publication.
Bidding is open to all...hand signal and voice call of the money amount. Everyone is open to the process.
Sending you a PM.

[Retired Navy]

Another little side note on mineral rights. Most, in West Virginia, have been reserved from property sales and passed down through generations to so many sons and daughters that it's virtually impossible to identify everyone who owns a share from a particular piece of property. As David said, the big investors can afford the research to track them all down after buying the property but the average Joe doesn't stand a chance. It's equivalent to a geneaology search of families that are now spread all over hell's half acre!!! I know... I tried it. We found several people that owned mineral rights to the farm we bought. We couldn't identify them all and most of the one's we did find would not have sold even if we had found them all. Don't let mineral rights stand in the way of buying a nice parcel for a home. Very few, with the exception of those who inherited land with the mineral rights, own the mineral rights to their land here in West Virginia.

[Mountain Valley Research]

I live in WV and know first hand of how booming the drilling of new oil and gas wells is nowadays. As far as purchasing mineral rights, there is always the possibility that it can be done. No promises or guarantees, but if you own the surface land, and someone else owns the mineral rights, and there isn't an active well on the property, anything is possible. Especially if they are not getting any royalty payments off the production of a well. I have seen some people sell them. It is always a good idea when you purchase land that doesn't come with mineral rights, to do the research to find out who owns them, and contact them to ask if you can buy them back. It doesn't hurt to ask. If they aren't getting any income off any wells, they just might sell. I have seen it happen within the last few years too. And as Mr. Kennedy said, if they are owned by too many heirs, then it wouldn't be worth the trouble nor the expense. Sometimes that is the case, but sometimes it is not. If it does end up unfortunately that you can't purchase the mineral rights, let them know to keep you in mind if they ever do decide to sell. Once you do buy surface land, (with no mineral rights), sometimes as the surface owner, if a deeded right of way is not in place, you could get compensated for crossing your property. Sometimes free gas can be discussed too, but again no promises or guarantees. That is up to the oil and gas company. The oil and gas company that plans to drill a well will contact you, the surface owner. And last but not least, you'll own a beautiful piece of surface land, and enjoy the tranquility of West Virginia. MtnValleyResearch@yahoo.com

[vec101]

Of course, those are questions for lawyers but these sites may also give some helpful info:
Oil/Gas: Mineral Rights in WV, coal rights, mineral rights
Landowners Call for Compensation
http://www.wvforestry.com/Frequently%20Asked%20Questions.pdf
http://www.wv.gov/Pages/Search.aspx?q=mineral%20rights has a lot of docs on it

Part of Concurring Opinion by Albright, J., State ex rel. Lovejoy v. Callaghan, No. 30670 :
"While either the surface owner or the mineral rights owner might make an argument that the Act seeks to impair their individual rights, the Legislature had before it the difficult task of achieving a balance of both sets of rights. In clear recognition of the public interest to be advanced by developing a system that would seek to “encourage the maximum recovery of oil and gas from all productive formations in this state,” the Legislature appears to have located a middle ground which serves to both benefit production interests and the interests of those people who might otherwise not have been justly compensated for such mineral extraction. W.Va. Code § 22C-9-1(b).

W.Va. Code § 22C-9-1(a).


As might be expected, the provisions of the Oil and Gas Conservation Act reveal a clear balancing of interests among the various entities affected by the enactment. Whereas the Act seeks to prohibit a surface owner from preventing operation of a mineral owner's right to search for oil and gas via a discovery or test well, [SIZE=2](See footnote 3)[/SIZE]the Legislature has, at the same time, devised a method of assuring that people who previously went unpaid for mineral extraction under the law of capture now will receive payment pursuant to a formula that contemplates pooling of the rights of those holding mineral rights to contiguous properties and a sharing of the costs of extraction and the royalties resulting from the production of oil and gas from deep wells.
While either the surface owner or the mineral rights owner might make an argument that the Act seeks to impair their individual rights, the Legislature had before it the difficult task of achieving a balance of both sets of rights. In clear recognition of the public interest to be advanced by developing a system that would seek to “encourage the maximum recovery of oil and gas from all productive formations in this state,” the Legislature appears to have located a middle ground which serves to both benefit production interests and the interests of those people who might otherwise not have been justly compensated for such mineral extraction. W.Va. Code § 22C-9-1(b). "

[vec101]

May want to check out WV Surface owners Rights Org
WV Surface Owners' Rights Organization

[Hinton Bound]

Originally Posted by Papachops

As some of you know I do have plans on buying some land in WV. It seems that most properties don't convey the mineral rights. What is the reason for that, and is there a way to purchase them back? I'm afraid I don't know much about the subject, but when I have the family homestead I'll be damned if someone is just gonna decide to dig a hole in my yard. Thanks

Papa,

I just bought land in WV. The easiest way to tell if the mineral rights are attached to the property is to look at the deed. If the property description starts with "SURFACE" then goes on to lay out the perimeter, you DO NOT own the mineral rights. If you go to the court house, you can trace the deed and find out who holds the rights. It's actually quite easy; took me 10 minutes to discover that my neighbor owned the mineral rights to my property. Luckily for me, he was holing them so no one could drill for gas. Once he was sure I wasn't out to timber then flip the property and sell the mineral rights, he gave them back for the price of the deed prep. If a corporation owns them, I'd have to say you're SOL.

The big surge these days is for the natural gas that is held in the Marcellus shale bank. It extends from NY to TN I think. Covers just about all of Appalacia.

Good luck with your land quest!

~Mark