Companies in Texas are always looking for new sources of gas and oil. It is important that all parties involved in a new find of gas or oil be aware of their rights and how royalties work. One of the more complex parts of this is understanding the link between surface rights and mineral rights. According to Houston Public Media, the United States is one of very few countries that allow private individuals to also hold ownership of the mineral sources that are underneath their land.

The reason for this is historical in nature. The founders of the United States did this so that private interests would always end up having a more prominent place in public life as compared to those of the British crown or the government. Thus, in many countries, when oil or gas is discovered it becomes the property of the government. However, when gas or oil is found in the United States it does not. Rather, energy companies need to pay the owners of land where gas and oil is found royalties for removing the deposits that are under it.

When people think about owning land, they are most likely to envision the surface rights. This is where you can build a house or plant crops. However, owning the surface rights also confers ownership of mineral rights. When a landowner is getting paid royalties for the oil or gas found on the property, this is through leasing the mineral rights of the land to the company.

When negotiating royalties for oil and gas deposits, it is important to ensure that the owner of the land is being appropriately compensated to avoid legal dispute.