This is the second article in our series on the transfer of mineral rights in Oklahoma.  In the last post, we discussed the several ways mineral rights can be titled – and if probate is required for these interests.  This post briefly explains what happens to mineral interests upon the death of the mineral rights holder.

Check how the mineral interest is titled

A family member passes away owning mineral rights.  You may be wondering who is entitled to this interest.  Who inherits a mineral interest after the death of the owner depends on how the interest is titled.

Mineral rights that are titled as joint tenancy with the right of survivorship go to the surviving tenants.  This is true even if the decedent gives the property to someone else in their last will.  Joint tenancy with the right of survivorship overrides the will provisions.  Start by reviewing the mineral rights deed.  You can request this document from the county clerk in the county where the property is located.

Mineral rights owned by a trust (revocable living trust for our purposes) avoid the probate process.  The trust property goes to the beneficiaries of the trust at a time and manner specified by the trust terms.  Real property ownership by a trust is public information that can be obtained from the county clerk.  However, the beneficiaries and the terms of the trust are kept private.

If mineral interests are owned by a business entity such as a limited liability company (LLC) where the decedent is a member, then the operating agreement addresses the transfer of the ownership interest.

However, if the interest is titled under the decedent’s name individually, then the interest must go through probate.  Let’s discuss this further in the section below.

If mineral rights are owned individually then probate is required

Mineral rights that are owned individually under a person’s name must go through probate after the owner’s death.  A probate is a proceeding that is overseen by the court where the decedent’s assets are inventoried, debts and taxes paid, and the estate distributed to the rightful heirs.

Interest titled under a person’s name must be probated, yes.  But, who gets that property?  This depends on whether the decedent left a last will.

A last will names the heirs and outlines who gets what from the decedent’s estate.  After the probate proceeding, the mineral interests are re-titled under the heir’s name.

If a person dies without a will, then he is said to have died intestate.  In such a situation, the Oklahoma Intestate Law of Succession controls.  Under the law, generally, one-half of the property goes to your spouse and the other half goes to your children.

Mineral rights left in the decedent’s name and never probated

What happens if the mineral rights are left in the name of the decedents and never probated?  Generally, mineral interests pass through probate, joint-tenancy, trust, business entity, or a transfer at death deed.  If the interest is titled under the decedent’s name and none of the above is applicable, then the interest will continue to be titled under the decedent’s name.

The heirs may resort to executing and filing an affidavit of death and heirship with the county where the property is located.  Oklahoma law allows the heirs to file such an affidavit claiming property rights in a severed mineral interest.  The affidavit must state whether the decedent died with or without a will and must list the name of the heirs, and their relationship to the decedent. 16 O.S. §67(A).  However, the affidavit must have been recorded for 10 years with the county clerk before the heirs can acquire a marketable title. 16 O.S. §67(C)(5).

If the mineral rights owner dies without specifying who inherits the property (like in a will), and they don’t have any family to inherit them either, then such interest escheats to the state – which means that it becomes the property of the state.  84 O.S. §271(1).  Additionally, if the property owner disappears for seven (7) years without anyone knowing where they are and no heirs claim or use the property during that time, it’s assumed that they died without a will or heirs.  At this point, the state can take ownership of the mineral rights. 84 O.S. §271(2).

Likewise, if proceeds from any mineral interests (like royalty) are abandoned for fifteen (15) years, those mineral interests won’t be escheated to the state, but instead, they will be subject to judicial sale.  This means that after 15 years of abandonment, the state can sell the mineral interest through a process overseen by the court.  84 O.S. §271.1.

The proceeds from the sale will be paid to the State Treasurer.  Any proceeds resulting from the sale of minerals deemed abandoned under §271.1 will be treated as proceeds subject to the Uniform Unclaimed Property Act.  It will be handled according to the regulations outlined in the act.  84 O.S. §276.

OKC Real Estate Lawyer

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