Mineral Rights 101

Mineral rights are the legal rights that a person has to exploit, mine, or produce any materials underneath the surface of the earth. A person may own the surface of the land, while someone else may own what is beneath the surface (otherwise known as the mineral rights). Whoever owns the rights to minerals can do whatever he or she sees fit with those minerals.

If you decide to sell your mineral rights, you could get a lump sum of money in exchange for the oil and gas an operator is looking to extract. The market determines how much the buyer will have to pay you to get the right. Before determining whether you want to sell mineral rights, consider the factors that will influence the value. Simply Minerals helps you with this valuation. These include current prices of commodities, the size of the property, size of the mineral deposit and performance of a nearby well.


Crude Oil vs. Natural Gas

  • Crude oil and natural gas are both energy commodities

  • We use these fuels to heat or cool our homes, drive our cars, and fly all over the world

  • The price relationship between crude oil and natural gas is one of the most dynamic inter-commodity spreads we trade

  • Oil trades in barrels

  • Natural gas is measure in millions of BTUs


Hydraulic Fracking 101

Exploration and discovery are the first steps. Hydrocarbons (oil and natural gas) are the product of millions of years of plant decay which now inhibit porous rock formations.

Today’s geologists and engineers have advanced methods of helping to locate oil and gas, including  typographical maps, aerial photography, sound waves, and 3D seismic projections to detect traps and potential deposits below ground.

The oil and gas industry is made up of many segments such as explorers, producers, laborers, environmental consultants, geologists, and engineers. After the exploration phase, it takes a large amount of labor, expertise, and investment to bring oil and gas into our everyday lives. In order to make this possible, there are three sectors— upstream (exploration, drilling, production), midstream (pipelines), and downstream (refining).

After researching where potential reserves may be, the next step is for companies to secure lease rights from mineral owners, along with the necessary regulatory approvals, including an approved application for a permit to drill (APD).

Wells can be drilled vertically (which has been the most common method until recently) or directionally. For the past 10 years in Colorado, operators have begun to turn the drill pipe laterally into a formation until it is completely horizontal (the new type of drilling, aptly named horizontal drilling).

Most horizontal wells utilize hydraulic fracturing to free up trapped oil and gas from non-permeable formations such as shale. This process utilizes a high pressured mixture of water and sand, along with some chemical additives, to bring oil and gas to the surface.

Stored oil and water is recorded daily by lease operators, also known as “pumpers”, who measure the tanks and provide notification when it’s time for water and oil haulers to pick up a shipment. Oil and natural gas can also be shipped from location by pipeline or trucked off to a railhead for refining.


If your mineral rights are in Weld County, Adams County, or Arapahoe County Colorado, please contact us for a free consultation.