Active Acquisition State
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Alabama is one of the top coalbed methane producing states in the country, with the Black Warrior Basin in the northwest part of the state hosting thousands of CBM wells. We buy mineral interests and royalties across Alabama, including coalbed methane interests in the Black Warrior Basin and conventional oil and gas production in the southern part of the state. Alabama's oil and gas history dates back to the early 1900s, and the state produces from a diverse mix of formations and play types. The coalbed methane industry, which took off in the 1980s and 1990s, created a large population of mineral owners who receive regular royalty income from CBM wells.
Highlighted state with approximate basin locations shown in tan
The table below shows the top producing counties in Alabama where we are most active, along with the primary operators and target formations in each area.
| County | Major Operators | Key Formations |
|---|---|---|
| Tuscaloosa | Black Warrior Methane, Warrior Met Coal, RAAM Gas | Pottsville Coal |
| Jefferson | Black Warrior Methane, RAAM Gas | Pottsville Coal |
| Fayette | Black Warrior Methane, Warrior Met Coal | Pottsville Coal |
| Walker | Black Warrior Methane, RAAM Gas | Pottsville Coal |
| Shelby | RAAM Gas, Warrior Met Coal | Pottsville Coal |
| Mobile | ExxonMobil, Shell, Eni | Smackover, Norphlet |
| Escambia | Hunt Oil, Hilcorp Energy | Smackover, Norphlet |
The Black Warrior Basin coalbed methane operations are run by several operators including Black Warrior Methane, Warrior Met Coal, and RAAM Gas. These companies maintain large portfolios of CBM wells across the basin. In south Alabama, ExxonMobil and Shell have deepwater operations in Mobile Bay, while Hunt Oil and Hilcorp Energy operate onshore conventional production. The CBM operator base in Alabama is specialized and has deep experience with the unique aspects of coalbed methane production, including water management and gas gathering.
Operators ranked by the number of Alabama counties where they hold the top active-well count. Counties where the operator runs the most active wells link through to the county detail page.
In Alabama, mineral rights are a property interest separate from the surface: the same acre can have one owner for the land and a different owner for the oil, gas, and coal beneath it. Once minerals are severed by deed or reservation, the two estates pass down independently — the surface through one chain of deeds, the minerals through another — and the mineral estate is dominant, meaning its owner (or their lessee) holds a legal right of reasonable surface access to develop the minerals.
Severed mineral ownership is unusually common in Alabama because of its coal history. In the Black Warrior Basin counties — Tuscaloosa, Jefferson, Walker, and their neighbors — land companies, coal operators, and railroads began reserving mineral estates in the late 1800s, decades before anyone knew the same coal seams would later produce natural gas. When coalbed methane development arrived in the 1980s, those century-old coal severances suddenly carried gas royalty value, and many Alabama families discovered they owned (or had lost) minerals under land their ancestors farmed.
Because of those long severance chains, confirming what you actually own usually starts in the probate office of the county where the land lies — Alabama records deeds, mineral reservations, and leases with the county probate judge, not a separate recorder. A title chain that establishes how the minerals passed from the original severance deed to you (through deeds, wills, or intestate succession) is what an operator needs before paying royalties, and what any legitimate buyer will verify before closing. If you only suspect an inheritance, a single old deed reference, royalty check, or even a family name and county is enough for us to begin tracing the chain at no cost to you.
Alabama mineral ownership is not lost through simple non-use — an unleased, non-producing severed mineral estate generally remains with its record owner and their heirs indefinitely. The practical risk is different: unclear title. Each generation that passes without deeds or probate being recorded splits the interest among more heirs and makes the chain harder to prove, which suppresses what the interest is worth. Cleaning up title — or selling to a buyer who handles the curative work — is usually worth more than the paperwork costs.
Alabama lease terms vary by play type. Coalbed methane leases in the Black Warrior Basin typically carry royalty rates of 1/8 (12.5%) to 3/16 (18.75%), with many legacy CBM leases at the 1/8 standard. Conventional leases in south Alabama may carry similar or slightly higher royalty rates. Alabama has a compulsory pooling statute through the State Oil and Gas Board, though it is less commonly used than in major shale states. The state imposes a privilege tax (severance tax) on oil and gas production at rates of 2% for oil and 4% to 8% for gas (including a conservation tax), depending on production volumes.
We buy mineral interests, royalty interests, NPRI, and ORRI across Alabama's producing counties.
Not sure which type you own? Start with our mineral rights glossary for plain-English definitions of MI, RI, NPRI, and ORRI.
Alabama's coalbed methane industry is concentrated in the Black Warrior Basin, where CBM wells produce methane from coal seams. CBM production has different characteristics than conventional oil and gas — wells typically produce large volumes of water along with the gas, and production rates tend to increase over the first few years as the coal is dewatered before declining. This production profile means that the economics of CBM mineral ownership are different from conventional plays, and we account for these differences in our valuations.
Alabama mineral owners occasionally run into questions about severance-tax treatment, dormant mineral statutes, and non-participating royalty interests. These topics rarely drive a transaction, but understanding them helps you read a division order or evaluate an offer. The summaries below are starting points — verify against current statute text before relying on them.
Oil and gas privilege tax: 8% of gross value at the point of production (Ala. Code 40-20-2). Reduced rates for offshore and discovery wells. A separate oil and gas conservation tax of 2% also applies.
Alabama counties also impose ad valorem property tax on producing minerals. The combined state-plus-county effective burden often runs 12-15% for onshore producing interests.
Statutory citation: Ala. Code 9-17 (conservation), 40-20 (privilege)
Alabama has no general dormant mineral act. Adverse possession of severed minerals is generally unavailable absent affirmative acts of mineral exploitation by the adverse claimant. Title cleanup is typically handled through quiet-title actions or affidavits of heirship.
Alabama recognizes NPRIs as cost-free royalty interests separate from the lessor's royalty. Treatment generally aligns with Mississippi and the Texas common-law framework.
Need plain-English definitions? See our mineral rights glossary.
Coalbed methane (CBM) is natural gas that is trapped in coal seams. It is produced by drilling wells into the coal and dewatering the formation, which allows the gas to desorb from the coal surface and flow to the wellbore. CBM production in Alabama is concentrated in the Black Warrior Basin, where the Pottsville Coal Group contains multiple productive coal seams. If you own mineral rights in the Black Warrior Basin, your royalty income may come from CBM wells. CBM wells have a different production profile than conventional wells — they often produce increasing volumes of gas over the first few years before declining.
In Alabama, mineral rights can include both coal and oil/gas rights, or they may be severed. It is important to understand what mineral rights you own. If your deed includes coal rights, those may be affected by active or planned coal mining. If your rights are limited to oil and gas (including coalbed methane), they are not directly affected by coal mining, though the proximity of mining operations can create practical considerations. We evaluate each interest individually to understand exactly what you own.
Alabama imposes a privilege tax (severance tax) on oil and gas production. The oil tax rate is 2% of gross value, and the gas tax rate varies from 4% to 8% depending on the type of production and volume (including a conservation tax on top of the base rate). These taxes are paid by the producer and reduce the gross revenue before your royalty is calculated. Sale proceeds are subject to Alabama state income tax at a top rate of 5%, plus federal capital gains tax.
The Alabama State Oil and Gas Board regulates all oil, gas, and coalbed methane production in the state. The Board issues drilling permits, establishes spacing units, and enforces production and environmental regulations. The Board also has compulsory pooling authority, though it is used less frequently than in states like Oklahoma. The Board's production records are publicly available and are a key resource in our evaluation process.
Yes. Coalbed methane mineral rights can be sold just like any other mineral interest. We routinely purchase CBM interests in the Black Warrior Basin. CBM interests can be particularly attractive for sellers because the long-lived nature of CBM production — which can continue for decades at steady rates — means these interests generate reliable royalty income that has clear present value.
Many Alabamamineral and royalty interests are held by heirs who live elsewhere. If that's you, our metro pages address the inheritance, ancillary-probate, and tax mechanics specific to your home state:
See all mineral rights FAQ.
State-specific guides covering the legal mechanics that come up most often for owners considering a sale.