If you’ve ever watched “About a Boy”, you probably remember the guy in the movie who was living comfortably off the royalties of a Christmas song written by his deceased father.
Lucky guy! You might say. But it’s not all luck…
Apparently, you can now cash-in on a similar concept in the business field.
If you have a royalty interest in an oil or gas-producing land, you are entitled to receive a part of the revenue that comes from the sale of the oil or the gas it produces without participating in the drilling and production costs.
Besides saving you all the headaches of production, oil and gas royalty interests provide a good option for adding diversification to your portfolio.
There is also considerable upside potential. If the company drills more wells, you’ll make more money as a royalty interest owner.
As with any other investment, a royalty interest has inherent risks; oil and gas price fluctuations, human mistakes and wars to a name a few. Always do your research and consult with your financial advisor.
How to get oil and gas royalty interests
So, how do you even tell which properties contain oil and gas?
You simply don’t.
Royalty interests are bought and sold like all other investments. There are many companies that act as brokers for royalty interests in oil and gas.
They require you to have a net worth of at least $1 million USD and the paychecks are sent on a monthly basis.