Mineral rights are the rights of the land lord which enables the owner of the land to explore, drill and sell the minerals present beneath the surface of his property. In fact many countries state that the person who owns the property has the rights only on the surface and any thing which is available under the surface belongs to the state government. So, the people of such states have the complete rights to do everything and anything with the mineral rights of their property. However, there are two kind of mineral rights which come under this category and they are the producing and the non producing mineral rights.
Producing mineral rights: The minerals which are under production or meant to be producing the minerals are said to be producing minerals. These mineral rights are in fact more expensive than the non producing mineral rights as the company knows that they can drill enough amounts of mineral from the surface. These mineral rights produce monthly revenue and can attract more companies to have a deal. The minerals are valued basing on the presence of production in that area.
Non producing mineral rights: Non producing mineral rights are those which do not have any kind of cash flow associated with them. And it is pretty clear that the value of the non producing rights are much lower than the producing ones. In other ways they can represent the option that something might happen good in the near future. Since there is lack of production till that period the value of the calculation of mineral rights will drastically decrease. As the investors are not sure about the positive outcome of minerals from a non producing site they show less interest when compared.
Producing mineral rights: The minerals which are under production or meant to be producing the minerals are said to be producing minerals. These mineral rights are in fact more expensive than the non producing mineral rights as the company knows that they can drill enough amounts of mineral from the surface. These mineral rights produce monthly revenue and can attract more companies to have a deal. The minerals are valued basing on the presence of production in that area.
Non producing mineral rights: Non producing mineral rights are those which do not have any kind of cash flow associated with them. And it is pretty clear that the value of the non producing rights are much lower than the producing ones. In other ways they can represent the option that something might happen good in the near future. Since there is lack of production till that period the value of the calculation of mineral rights will drastically decrease. As the investors are not sure about the positive outcome of minerals from a non producing site they show less interest when compared.
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