Illinois Oil and Mineral Rights Attorneys

If you own a piece of property—anything from a large tract of open land to a regular house that sits on a small plot—you also own the rights to whatever lies under the surface. Whether it’s metals, minerals, oil, or another natural asset, it belongs to you.

Of course, extracting that value is something most regular property owners can’t do on their own. As a result, when valuable minerals, oil or gas are located underneath the property, large companies seeking to extract the materials show up at the property owner’s door ready to purchase or lease the mineral rights.

When oil or gas is pulled from the ground, various types of ownership interests are legally formed, which are complex and technical. Any Illinois property owner unsure whether their oil and gas rights were formally severed from the surface, or not, should determine whether or not interest to the oil and gas formations being extracted from under the surface are theirs by right.

Salyer Law Offices represents Illinois oil and gas owners whose rights have been ignored or abused by oil and gas companies. Our attorneys are not intimidated by major corporations and their high-priced legal teams. We have taken them on before and won; we will do everything we can to do it again for you.

Sources of Conflict in Oil, Gas and Mineral Cases

In the U.S., mineral rights belong to the person who owns the land or to the persons who own the right to extract the oil and gas from under the land. Landowners are free to convey those mineral/oil rights to a mining company or similar entity to extract the minerals.

Typically, the landowner wants to sell or lease rights to what’s under the ground but retain ownership and control of the surface. Meanwhile, the oil and gas company or mining company wants what’s underneath but doesn’t want to pay more money to acquire the surface rights.

That sounds like an alignment of interests. The complications and disputes, however, arise quickly and include:

  • Failure of the company to pay royalties to the landowner
  • The company leases the rights but fails to take action to extract the material
  • Environmental damage to the land
  • Contamination of neighboring land, drainage systems and groundwater

By the time the oil and gas company is finished, the landowner could be left with property so damaged that it may not be worth half as much as it was before.

More complicated practice occurs when the surface is severed from the right to minerals under the surface estate. In such cases, the oil producers who drill and mine to extract the minerals are required to pay mineral interest to the varying mineral ownership interests:

Surface and Mineral Estate Not Severed
  • If not severed, both can be adversely possessed
SevME Surface and Mineral Estate Severed
  • Surface Estate can be adversely possessed.
  • Mineral Estate possession of the Surface will not alone constitute adverse possession to the mineral estate
ME Mineral Estate
  • Can be adversely possessed
  • Actual possession of the mineral must occur; for oil and gas that means drilling and production of oil and gas Interests in Mineral Estate are either Working Interests or Leasehold Interests, each consist of right to produce minerals under a given tract and obligation to bear the costs of exploring and for developing such minerals
RI Royalty Interest
  • Cost-free interests in production from the mineral estate under a given tract of land and, once created, are owned separate from and carved out of, the mineral estate that they burden
  • Non-Possessory (i.e. the royalty interest entitles you to a cost-free share of production when and if it is produced from the subject tract, but gives the holder thereof nothing to possess until that production is obtained, nor does it entitle the holder to any right to go onto the subject tract and cause that production to occur, the rules of adverse possession do not apply as nothing is being possessed, adversely or otherwise
  • Inherently void of the right to go onto the tract and cause that production to occur
NPRI Non-Participating
Royalty Interest
  • Non-Possessory
  • An NPRI is a royalty interest carved out of the mineral estate, but it is differentiated from other royalty interests in that it lacks certain rights, such as the executive right to lease the subject mineral estate and the right to collect bonus and delay payments from any such lease. Just like a royalty, an NPRI cannot be adversely possessed because it is non-possessory.
ORRI Overriding Royalty Interest
  • Non-Possessory
  • An overriding royalty interest is a royalty interest that is carved out of a leasehold interest and thus only survives as long as the underlying lease is in effect
  • Is not possessory—it is a type of royalty interest and is void of the right to go onto the tract in question and cause production to occur
  • Receipt of royalty payments is not a basis for adverse possession of a royalty
LH
Operated WI		 Leasehold Interest/Operated Working Interest
  • Possessory Interest whether occurring through ownership of the mineral estate or through ownership of a lease of the mineral estate
  • Cessation of Production/Lease Expires through production from the lease ceasing without additional operations being conducted or delay rentals being paid for the requisite period stated in the Lease
  • Former Lessee can trespass by drilling new wells and paying royalties on the same terms as the Lease after Lease Terminated taking minerals it has no right to take
NON-WI Non-Operating
Working Interest
  • Where there are multiple working interest owners that are all entitled to produce minerals on a given tract, the parties typically enter into a joint operating agreement (JOA) that designates one working interest owner as the operator and the rest as non-operators of the area covered by the JOA (Contract Area)
  • Non-Possessory
  • Non-Operating Working Interest is not taking oil and gas out of the ground—it is not possessing anything. A non-possessory interest such as a royalty interest is not subject to adverse possession, and a non-operating working interest is similar to a royalty interest because it is non-possessory

We Help Landowners Protect Their Rights

If you own land and have been in contact with any type of oil, gas or mining company, make sure you contact an attorney before signing a lease or selling the mineral rights. These companies may try to take advantage of you by paying far less than you deserve or by giving themselves “outs” that could leave you without much benefit at all. Have an attorney review the contracts and negotiate key points.

If you have been harmed by an oil and gas or mining company, reach out for help. Salyer Law Offices knows what it takes to recover compensation for shoddy extraction practices, damaged land and other related items. We’ll help you stand up to the corporate interests.

If you have inherited any land (surface estate) or mineral interest (right to extract mineral from underneath the surface), or, if you are unsure, contact Salyer Law Offices for an examination of title to the varying interests that can develop in the oil fields.

Get a Free Consultation With Our Chicago Legal Team

Do you believe an oil and gas company may owe you royalties? Have minerals been unlawfully taken from your property? The attorneys at Salyer Law Offices are ready to meet with you.