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WHY SELL

01

LIQUIDITY

A lump-sum cash payment accelerates decades of payments. Oftentimes, owners use this to invest in themselves and their families. Examples include investing into a new business, buying real estate, paying for college, and setting up a retirement fund. 

04

ESTATE PLANNING

Distributing minerals to multiple heirs could reduce their value due to additional fractionalization.
Some owners feel that is easier to distribute cash than dividing up minerals and royalties for smaller checks to heirs.

02

CLIMATE CHANGE

Recently, many owners have been looking to sell to us due to climate change's potential impact on the industry. Given the current administration's viewpoint on oil and gas, some owners are looking to get out of the industry.
Some believe in reducing their carbon footprint and feel guilty supporting the industry and receiving royalties. 

05

DECLINING REVENUE

With steep decline curves and wells eventually running dry, mineral owners receive lower checks every month. Some owners look to sell their minerals and royalties while production is still at reasonable volumes

03

TAX REASONS

Income from minerals and royalties tends to have ad-valorem, severance, and federal income taxes associated with it.
Dealing with the administration and accounting of royalty income is a hassle. With capital gains tax typically being lower than ordinary income tax, owners take advantage of tax breaks when selling to us.  

06

DIVERSIFICATION

Many owners have a sizable portion of their net worth tied into minerals.  Owners sometimes use the lump-sum payment to invest into a well-diversified stock market ETF with appreciation and regular dividend payments.

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