What is the difference in a participating and a non-participating Mineral Deed?

Question

What is the difference in a participating and a non-participating Mineral Deed?

Answer 1

It's going to depend on state law and what the deed says.  

My guess, based on experience with mineral interests in several states (although I've never seen one captioned as "participating" or "non participating") is that it is actually a cross between a complete sale of mineral interests and a mineral lease.

With complete transfer, the surface owner retains no interest in the minerals at all, and only has rights to their use not being unreasonably disturbed.  

With a lease, the mineral owner still owns, another party has a right to extract, but pays the mineral owner according to the quantity extracted.  

Participating sounds like it means that they sold the mineral rights, but still get a percentage of the quantity extracted, either that or they actually sold only a fractional interest in the minerals.