Last Updated on A land or mineral owner, who does not receive a royalty check for 1-5 years, can have the funds turned over to the state. The state holds the cash in a suspense account – it does not sell the royalty interest. Unclaimed royalties amounting to millions of dollars are waiting for the rightful royalty owners to register claims.
To file for unclaimed royalties (also known as production payment), you can make a claim yourself or on behalf of heirs. In this article, we help you understand how these unclaimed rights can be found and claimed.
What are unclaimed mineral rights and oil and gas royalties?
Simply put, unclaimed mineral rights are oil and gas rights and royalties belonging to an owner who has not claimed them for 3-10 years.
At this point, the law permits the leasing operator (oil and gas companies) administering such oil and gas royalties to hand over the responsibility to the state.
For example, in Texas, unclaimed property is transferred from these companies to the state after 3 years. But in Oklahoma, it happens after 5 years. The state government administers unclaimed funds from royalty payments for owners they cannot find or whose ownership is under dispute.
As a result, these funds are considered Unclaimed Property according to the law, and the relevant data enters into state records.
Whenever oil and gas companies negotiate a lease, a part of the oil and gas production from the land goes to the landowner. Accordingly, oil and gas royalties are part of the lease, notwithstanding the reasonable production costs incurred by the lessee.
Royalties are paid on resulting mineral production to the owner of the rights, referred to in the lease as the lessor. The owner is free of all production costs regarding gross oil/gas production.
What causes unclaimed mineral rights and royalties to be unclaimed?
There are many reasons why suspended or unclaimed oil and gas royalties exist.
Some of these reasons include:
- Simple misspellings in title, land or deed documents or records relating to site ownership, production information, lease terms, or ownership of oil wells.
- Owners not located at the registered mailing address
- Problems with property title or land ownership when the owner tries to sell
- Death of landowners
- Incomplete information regarding chain of land ownership, unable to determine heirs/next of kin.
- Pending lawsuits, court action, or disputes regarding land access or lease documents.
- Unsigned division orders: legal documents that detail interest in specific oil wells or other mineral resources. If division orders are not processed correctly, they are not legally binding.
- Owners of land or minerals who are unaware they are due large sums of money. The amount may be in the millions.
- Unregistered royalty interests are sold for cash to a person or business.
- Thinking that claiming minerals or mineral royalty payments is a complex process.
What happens to unclaimed mineral rights if you never search for them?
According to law, when the rights to minerals remain unclaimed for a long time, the lessor must hand them over to the state. You can file a claim if the minerals are in your name or the name of the royalty owners you inherited them from. If you want to track other information regarding the mineral rights, you can check the following:
- National database
- States where minerals are found
- States where mineral owners are based
- States where mineral operators are found
- Delaware (home to many companies)
Below is the information we found concerning the dormancy period for unclaimed mineral royalties in each state.
State Dormancy Period Websites to search unclaimed funds
| National | N/A | https://www.missingmoney.com/en/ |
| Alabama | 3 Years | https://alabama.findyourunclaimedproperty.com/ |
| Alaska | 3 Years | http://treasury.dor.alaska.gov/Unclaimed-Property.aspx |
| Arkansas | 3 Years | https://auditor.ar.gov/ |
| California | 3 Years | https://www.sco.ca.gov/upd msg.html |
| Colorado | 5 Years | https://colorado.findyourunclaimedproperty.com/ |
| Delaware | 5 Years | https://unclaimedproperty.delaware.gov/ |
| Florida | 5 Years | https://www.fltreasurehunt.gov/ |
| Kansas | 5 Years | https://kansascash.ks.gov/up main.html |
| Louisiana | 2 Years | https://louisiana.findyourunclaimedproperty.com/ |
| Mississippi | 5 Years | https://treasury.ms.gov/for-citizens/unclaimed-property/ |
| Montana | 5 Years | https://tap.dor.mt.gov/ |
| New Mexico | 5 Years | http://www.tax.newmexico.gov/Individuals/unclaimed-property.aspx |
| North Dakota | 3 Years | https://unclaimedproperty.nd.gov/ |
| Ohio | 1 Year | https://www.com.ohio.gov/unfd/ |
| Oklahoma | 5 Years | https://www.ok.gov/treasurer/Unclaimed Property/index.html |
| Pennsylvania | 3 Years | https://bluemesaminerals.com/mineral-management-books/ |
| South Dakota | 3 Years | https://southdakota.findyourunclaimedproperty.com/ |
| Texas | 3 Years | https://claimittexas.org/ |
| Utah | 3 Years | https://mycash.utah.gov/ |
| West Virginia | 5 Years | https://wv.findyourunclaimedproperty.com/ |
| Wyoming | 3 Years | https://statetreasurer.wyo.gov/unclaimed-property/ |
Can you claim back money from the state?
Yes, you can.
Using today’s technology, you can quickly and easily understand any oil or gas leases and production information located in databases and the value of any related royalty. If you want to get your money, state officials will ask for evidence supporting your right to the unclaimed oil or gas rights located in your search.
You may need to show evidence of inheritance or complete an Affidavit of Heirship (AOH) if you are claiming royalty payments on an inherited property.
Since state authorities actively try to prevent identity fraud and theft, the burden of proof can be high. However, the process for royalty owners is not complicated.
How to search for unclaimed mineral rights or royalties
Finding unclaimed oil royalties is easy. Due to generally buoyant commodity prices for minerals, there are large amounts of money unclaimed. Even a small share or multiple short-term leases can lead to millions of dollars in royalty income in some cases. These funds are waiting for the rightful owner to claim them.
Try searching the following databases:
- National Database: use the unclaimed property database, missingmoney.com. However, not all states update this platform, so also check the state database.
- State Database: look for unclaimed property in states where the mineral owner resides or via their last known address.
- Operator Database: find unclaimed property in a state where oil and gas operators are incorporated or located.
You should find information regarding the unclaimed royalty payments in any of these areas. Once detected, you can apply to the state to recover them. However, the state may require proof of sale or your connection to the landowners or owner of the mineral rights. So prepare your evidence.
What documents does the government require from you?
When claiming royalties from an unclaimed mineral right, you need to present valid identification which states who you are.
To claim the royalties of inherited lands or property with minerals onsite, you have to present evidence of inheritance or file an Affidavit of Heirship.
Present these documents at the state office of your property location. Then, the state should advise you of the value due and start processing the payment of the royalties to you.
How do you find out if you are owed unclaimed mineral rights payments?
If you’re owed payments, the total amount due will be escheated to the state treasury office as per the laws of your state.
You can then log on to www.unclaimed.org to check for information regarding your payment. Links to all Unclaimed Property offices with easy-to-follow instructions are provided on this website.
If the company in charge of paying the mineral rights is an international company, inquire with the state of Delaware or the state of New York.
How long does it take to get back unclaimed rights or royalties?
There is no simple way to answer this question since the rules differ from state to state.
The specifics regarding your unclaimed royalties will need to be verified with the institutions storing your abandoned assets. You need not worry about a time frame since the state keeps the money safe for the rightful owner, which, in this case, is you.
Sometimes you may not get the funds back for several months, or it may only take a couple of weeks.
The final step is to wait for your unclaimed money to be returned within the timeframe promised.
Who do you need to contact about unclaimed royalties or other oil and gas proceeds?
Finding the correct information about your unclaimed mineral royalties can be stressful if you don’t have the patience to do your research. The federal government does not have one central website where all the data is located.
You don’t need to hire a company or specialist service to help with your search.
You can check using official sources.
Start your search with the state’s unclaimed property office. Or you can check through a multi-state database.
Verify the claims process because each state has its rules regarding proving you are the royalty owner and claiming any suspended funds found.
Conclusion
In this article, we have provided helpful information you need if you have any unclaimed rights. You know the records and databases that will help in your research. With the title deed, cash sale receipt, or other related documents, it is easy. Contact your lawyer to start the search if you can’t do it yourself.
Alternatively, engage Pheasant Energy, a reliable broker of surface and mineral rights and mineral resources in the USA. We can help provide additional information should you decide to sell if your claim is successful.
VERY HELPFUL THANK YOU
Very informative site, Thank you,