SPEARFISH — Landowners who don't know their rights could be missing out on an opportunity to develop — or protect — valuable minerals right under their feet.
Minerals like oil, gas, coal, clay, gravel and uranium occur in varying quantities across North Dakota and South Dakota. According to David Ganje, a natural resources and commercial lawyer with Ganje Law in Rapid City, the rights to those mineral deposits usually lie with their respective landowners — but not in every case.
In a Sept. 14 presentation at the Black Hills Pioneer's Oil, Gas and Mineral Rights Workshop in Spearfish, Ganje explained that there are two aspects to land rights: surface rights and mineral rights. Usually those two go hand-in-hand, but Ganje said it is possible for those rights to be severed from each other and granted to separate parties, whether through a will, contract or other legal document.
In other words, a landowner might not actually have rights to the minerals on his or her land, and if not, they have no chance to develop or protect them.
However, under the South Dakota Dormant Mineral Rights Act, mineral rights might possibly be reclaimed by the surface owner, and for that reason Ganje said it's important that owners know their rights and what they are entitled to on their land.
“Not everybody thinks about these mineral rights, and I think more South Dakotans should think about them ... for reasons of value and future development,” Ganje said.
Under the Dormant Mineral Rights Act, if the mineral rights holder does nothing to develop those minerals for a period of 23 years, he or she loses the mineral rights to that land and the surface owner can take them back, giving them access to the gold, oil, coal, etc. beneath their land that they couldn't touch before.
Ganje encouraged landowners to research their rights to see if they have mineral rights to their land, and if not, if they are able to reclaim them. It takes research, he said, but it is relatively inexpensive even if one hires a lawyer and the process is not that complicated. Plus, the benefits could easily outweigh the hassle, he said.
“If you reacquire mineral rights, it makes your land more marketable,” Ganje said. “It makes your land more developable, because you can lease out the mineral rights.”
On the other hand, if a landowner wanted to protect a parcel of ground from being developed or mined for minerals, owning the mineral rights would allow them to do that.
Ganje added that the Dormant Mineral Rights Act is not always the best tool for reclaiming mineral rights, and should not be used in all circumstances.
But according to Ganje, those who don't know or don't try, can't benefit. Landowners sitting on potential oil deposits may be missing out. They may not be able to develop the land if they want to, or protect it if they don't.
The first step, Ganje said, is to get educated.
This article is based on the issues presented at the Black Hills Pioneer's Oil, Gas and Mineral Rights Workshop on Sept. 14. A video recording of the workshop is available for purchase by calling the Pioneer at 642-2761.