How Tens of Thousands of Americans Got Cheated Out of Their Mineral Rights

        Mother Jones magazine political writer Thomas Stackpole published this article on October 9, 2013. His analysis is an explicit Logos argument based on legal evidence and research data from sales documents. Documentation is culled from a Reuters.com report from the same day. Based upon the widely respected credibility of the Reuters name in news research,  Stackpole makes the central claim to his homeowner audience that many Americans have purchased houses without realizing that the builder or developer has retained the sole rights to mineral deposits that could be located beneath the property. According to the author the warrant of the argument is that the shady practice is widespread and is increasingly occurring from coast to coast unbeknownst to the general public. The scenario has become especially worrisome of late because invasive ‘fracking’ has been employed as a means to extract oil residue from previously unusable shale. Although the article maintains that many states known for their abundant oil reserves also commonly sell only the surface rights to homes, the improved technology that allows for maximizing oil from rock has made a larger segment of the country fair game for oil companies in pursuit of bigger profits. Royalties from this type of drilling paid out “more than twenty billion nationally in 2012.” The magnitude of those potential profits has led to self-serving behavior by some corporations who are not always forthcoming with their home buying clientele. D.R. Horton commonly understood per Reuters to be the largest builder in the United States; is one of the companies cited for this business practice. Although 700 homeowners in North Carolina previously bilked of their mineral rights by Horton, were able to win them back in court; many others are unaware and or out of luck. A sheep farmer in West Virginia lost his appeal for damages or an injunction when his farm was all but destroyed by the local energy company seeking access to reserves. However, more startling than the loss of profit to the homeowner is the potentially far-reaching cumulative impact of such deals. For instance, in some cases banks like Wells Fargo may not extend mortgages to homes encumbered by such restrictions. Additionally many insurance companies do not cover damage to property caused by mineral extraction, which could leave the owner of the subject property in double jeopardy, suffering diminished value and no protection for their loss. Stackpole’s presentation is logical and linear although he offers little in the form of implied rebuttal beyond offering that some states are already codifying the practice.  He concludes his fact-based argument with a policy-based conclusion in the form of the caveat “buyer beware.”