Frequently, property owners in Texas with mineral rights sign oil and gas leases. These contracts give companies the option of extracting resources from the property by establishing wells there.
Oil and gas leases can provide regular revenue for property owners, making them a valuable consideration. Those who have signed an oil and gas lease or who are eligible to do so may need to consider what will happen to their mineral rights after their passing.
Families may fight over mineral rights
Any resources that have direct economic value or that represent the potential of future income can trigger disputes after the owner dies. Estate planning is critical to prevent surviving family members from ruining their relationships with one another to acquire certain assets.
Directly addressing mineral rights and existing leases, in addition to the property itself, in an estate plan can minimize the potential for conflict. Property owners may even determine that they want to establish trusts.
Trusts can provide more nuanced control over high-value assets. Property owners could arrange for their spouses to continue living in the home indefinitely, while their children might receive a portion of the proceeds from the oil and gas lease for the property.
Creating limited liability companies (LLCs) to manage leases and their revenue is also a common strategy. There are numerous estate planning strategies that can help people address their real estate and oil and gas rights as part of a broader estate plan.
Reviewing oil and gas leases with an attorney familiar with both estate planning statutes and oil and gas regulations can be beneficial for property owners. The right plan can help an individual leave a positive legacy when they pass instead of causing conflict among their loved ones.
