It is important to understand the different rights owners of Real Estate have and how they relate to energy assets. It is easiest to break ownership into three categories.

1st Are the surface land owners who possess Surface Rights which are conveyed in title to the land and allow the building of surface structures, farming of the land , etc.


2nd Are the owners of sub-terrain "mineral" rights, or Mineral Right owners. Underground Mineral Rights (also known as Mineral Interest) are separate from Surface Rights and allow their owner to authorize drilling outside 200 feet of a surface structure. When a drilling company hits a producing source of energy and puts a well on it, a Mineral Right becomes a Royalty Interest (often a right to 20-25% of production) and the portion owned by the drilling company is called a Working Interest (75%-80% of production).


3rd Are the driller operators of the wells. Operators typically negotiate a long-term lease with the Mineral Interest owners. The portion owned by the drilling company, or operator, is called a Working Interest owner (generally 75-80% of production). These groups can be large operators like Exxon-Mobile, Texaco and Anadarco or small wildcat drillers of various sizes.