Mineral, surface and royalty interests: what you actually own
Published September 23, 2026.
People say they own mineral rights when they mean four or five different things. The differences are not academic: they decide whether anybody has to ask your permission before drilling, whether you get a check when they do, and whether you can be asked to pay for anything.
Two estates in one piece of land
In Texas the minerals under a tract can be owned separately from the surface of it. When that separation has happened, lawyers say the estates have been severed, and from then on there are two owners of the same piece of land: the mineral interest owner and the surface estate owner.
Severance happens by deed. Either somebody sold the land and kept the minerals, or sold the minerals and kept the land. Once it has happened it stays happened, and the two estates travel down separate chains of title forever after, which is why a family can own minerals under a subdivision nobody in the family has ever seen.
Texas law treats the mineral estate as dominant. That means the mineral owner, or the company holding a lease from it, has the right to use as much of the surface as is reasonably necessary to get the minerals out, without buying that right from the surface owner. Texas courts have limited this with what is usually called the accommodation doctrine, which asks whether an operator has reasonable alternatives when its use would preclude an existing surface use. How that applies to a particular pad, road or pipeline is a fact question, and a Texas oil and gas attorney is the person to put it to.
Surface owners and operators often deal with this by agreement rather than by litigation, in a surface use agreement covering location, roads, fences, water and payment for damages.
The five sticks
A full mineral interest is usually described as a bundle of five rights, and each one can be sold, reserved or given away on its own.
- The right to develop. The right to go on the land and drill, with the surface access that goes with it.
- The right to lease, called the executive right. The right to sign an oil and gas lease and choose its terms.
- The right to receive bonus. The up-front payment for signing a lease.
- The right to receive delay rentals. The payments that used to keep a lease alive during the primary term, now rare because most leases are paid up.
- The right to receive royalty. The share of production the lease reserves to the mineral owner.
Once you know the five sticks, most of the confusing interests become easy to name. Somebody holding all five owns a mineral interest outright. Somebody holding only the fifth owns a non-participating royalty interest: they share in production and are never asked to sign anything. Somebody who sold their minerals but kept the executive right, or kept the minerals and gave the executive right away, has split the bundle in a way that will need reading carefully by whoever comes after them.
Royalty interests
Three things are all called royalty and they come from different places.
A lease royalty is what the mineral owner reserves in the oil and gas lease, traditionally one eighth and now more often something between one fifth and one fourth. It exists because of the lease and it ends when the lease ends.
A non-participating royalty interest is carved out of the mineral estate by deed and owned separately. Its holder is paid on production whatever the current lease says about royalty fractions, has no right to lease, gets no bonus, and is not consulted.
An overriding royalty interest is carved out of the working interest, usually reserved by a geologist, a landman or a company assigning a lease on. It is paid like a royalty, and because it comes out of the lease rather than out of the land, it dies when the lease dies.
All three are free of the cost of drilling and operating, which is what makes them royalty. All three can still bear post-production deductions, depending on the words of the instrument that created them.
Working interest
The working interest is the other side of the lease. It holds the right to drill and the obligation to pay: its share of the well, the casing, the completion, the pumping unit, the saltwater disposal and the eventual plugging. Operators and their partners hold it.
A mineral owner who signs a lease does not hold a working interest, and that is the point of leasing. You trade the right to develop for a bonus and a royalty, and you never see an invoice.
There are two ways an ordinary owner ends up nearer to one than they expected. An unleased mineral owner whose tract is drilled is not simply ignored; their position is worked out under rules that a lawyer has to apply to the facts, and it is not the same as being a royalty owner. And an owner who was offered a lease with a conversion or participation option has been offered something with costs attached, which is a different decision from an ordinary lease and one worth taking to an attorney before answering.
Reading your own paper
The words in a deed decide which of the above you have, and small differences carry a lot of weight.
A grant or reservation of an undivided one-half interest in and to all of the oil, gas and other minerals in and under a tract is a mineral interest: half of all five sticks.
A grant or reservation of an undivided one-sixteenth royalty interest in all of the oil, gas and other minerals produced and saved is a royalty, not a mineral interest. The holder gets a share of production and none of the rest of the bundle.
The hardest cases are the ones that look almost identical. One-fourth of the royalty and a one-fourth royalty are not the same thing: the first is a share of whatever royalty the lease happens to reserve and moves with it, while the second is a fixed fraction of production. Older Texas deeds are full of fractions written against an assumed one-eighth royalty, and Texas courts have spent decades deciding what particular ones mean.
Nothing in this guide can tell you which one your deed is. Reading it is a job for a Texas oil and gas attorney, and where an interest is worth anything at all, a title opinion is the normal way it is done.
What to do next
Gather the deeds and find, for each interest, three things: whether it is mineral or royalty, what fraction is written, and whether the right to lease came with it. Put the lease beside them, because the lease is what turns a fraction into a decimal.
Take a deed you cannot confidently classify to a Texas oil and gas attorney, and take the income and depletion questions to a CPA. Neither is expensive relative to the cost of acting on a misreading.
NetAcre finds your minerals on the county roll and tells you when something is filed near them, free.