Active Acquisition State
Prefer to talk? Call (432) 400-4602
Southeast New Mexico is one of the hottest oil and gas markets in the country. The Delaware Basin, which extends across Lea and Eddy counties, has driven New Mexico's oil production to record levels and made mineral valuations among the highest in the country due to the exceptional production potential. New Mexico surpassed North Dakota to become the second-largest oil-producing state in the US, and the pace of drilling shows no signs of slowing. The state also has meaningful production from the San Juan Basin in the northwest, where natural gas, coalbed methane, and emerging Mancos Shale development contribute to a diversified production base. We buy mineral interests and royalties across both basins and in every producing county in the state.
Highlighted state with approximate basin locations shown in tan
The table below shows the top producing counties in New Mexico where we are most active, along with the primary operators and target formations in each area.
| County | Major Operators | Key Formations |
|---|---|---|
| Lea | ConocoPhillips, Oxy, Mewbourne Oil, Devon Energy | Wolfcamp, Bone Spring, Avalon |
| Eddy | ConocoPhillips, Oxy, XTO Energy, Mewbourne Oil | Wolfcamp, Bone Spring, Avalon |
| Chaves | ConocoPhillips, EOG Resources | San Andres, Yeso, Abo |
| Roosevelt | EOG Resources, ConocoPhillips | San Andres, Abo |
| San Juan | Hilcorp Energy, ConocoPhillips, BP America | Mancos, Pictured Cliffs, Fruitland Coal |
| Rio Arriba | Hilcorp Energy, Devon Energy (formerly WPX) | Mancos, Mesaverde, Gallup |
We cover 8 New Mexico counties in total. Beyond the counties highlighted above, we also buy mineral rights in these 2 additional producing counties, listed in order of recent oil and gas activity:
The Delaware Basin in New Mexico is dominated by some of the largest operators in the Permian. ConocoPhillips, Oxy (Occidental Petroleum), Devon Energy, and Mewbourne Oil Company hold substantial acreage positions in Lea and Eddy counties. XTO Energy (an ExxonMobil subsidiary) also has a significant presence. In the San Juan Basin, Hilcorp Energy and ConocoPhillips are the most active operators, having acquired much of the legacy BP and Burlington Resources acreage over the past decade. The operator mix in New Mexico is heavily weighted toward large-cap companies, which generally means well-capitalized development programs and predictable drilling schedules.
Operators ranked by the number of New Mexico 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.
New Mexico lease terms in the Delaware Basin typically include royalty rates of 20% to 25%, with 1/5 (20%) being the most common standard. Bonus payments for new leases in the core Delaware can range from several thousand to tens of thousands of dollars per net mineral acre depending on location and competition among operators. New Mexico does not have a forced pooling statute in the same sense as Oklahoma — the state uses a compulsory pooling process under the Oil Conservation Division (OCD) that is less commonly invoked. Federal and state mineral leases, which are common in New Mexico, carry their own royalty rate schedules (typically 12.5% for federal and 16.67% for state). Pugh clauses are standard in most modern New Mexico leases.
We buy mineral interests, royalty interests, NPRI, and ORRI across all of New Mexico'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.
New Mexico has a large amount of federal and state mineral ownership, which can complicate title on some tracts. Federal minerals under BLM leases are common in the San Juan Basin and in portions of Lea and Eddy counties. State minerals managed by the New Mexico State Land Office are also prevalent. We are experienced with federal unit participation, state lease issues, and the unique title challenges that come with mixed fee/federal/state ownership patterns in New Mexico.
New Mexico 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.
Combined effective rate roughly 8% on most oil and gas production: oil and gas severance tax 3.75%, oil and gas school tax 3.15% (oil) / 4.0% (gas), oil and gas conservation tax 0.19%, plus an oil and gas ad valorem production tax assessed at the county level (varies, typically 1-2%).
New Mexico is one of the few states where the separate component taxes total to a meaningful effective rate without being labeled a single severance tax. State and county receipts from oil and gas tax fund a substantial share of state spending and the Land Grant Permanent Fund.
Statutory citation: NMSA 7-29 (severance), 7-31 (school tax), 7-30 (conservation)
New Mexico has no dormant mineral statute. Mineral interests once severed remain in the holder's name indefinitely. Title cleanup for unknown owners is typically handled through OCD pooling notice (NMSA 70-2-17) when an operator wants to develop, or through quiet-title proceedings.
New Mexico recognizes NPRIs as a cost-free royalty interest separate from the lessor's royalty. Mountain States Mutual case law treats NPRI holders similarly to Texas — they share in royalty without bearing lease bonus, delay rentals, or working-interest costs, subject to the language of the conveying deed.
Need plain-English definitions? See our mineral rights glossary.
Mineral rights in the core Delaware Basin counties of Lea and Eddy are among the most valuable in the country. Depending on the location, existing production, and remaining undeveloped potential, valuations can range from the low thousands for fringe acreage to five figures or more for core producing tracts with multi-bench development. The Delaware Basin's stacked pay zones — Wolfcamp, Bone Spring, and Avalon — mean that a single tract may have current production from one formation and significant undeveloped upside in others.
New Mexico has a compulsory pooling process administered by the Oil Conservation Division (OCD), but it is used less frequently than in Oklahoma. Under New Mexico law, an operator can apply to the OCD to pool unleased mineral interests into a drilling unit, but the process involves a public hearing and is subject to certain protections for mineral owners. In practice, most operators prefer to negotiate voluntary leases rather than go through the compulsory pooling process.
A significant percentage of mineral rights in New Mexico are owned by the federal government and administered by the Bureau of Land Management (BLM). Federal mineral leases carry a standard 12.5% royalty rate and are subject to the Federal Onshore Oil and Gas Leasing Reform Act. If your mineral interest is adjacent to or commingled with federal minerals, the title chain may involve federal unit agreements or communitization agreements that we are experienced in evaluating.
New Mexico does not impose a separate capital gains tax, but mineral rights sale proceeds are subject to New Mexico personal income tax at rates ranging from 1.7% to 5.9%. The sale is also subject to federal capital gains tax. Ongoing royalty income in New Mexico is subject to the state's oil and gas severance tax and the Oil and Gas Conservation Tax, which are typically withheld by the operator before royalty payments are distributed.
We start by pulling production data from the New Mexico Oil Conservation Division and looking at how the wells on or near your acreage are actually performing. We review existing lease terms, look at permitted locations and well spacing around the tract, and factor in operator quality and title. For Delaware Basin tracts, we give particular attention to the number of productive formations that have been drilled and the remaining undeveloped benches that add upside value. Every tract is underwritten individually — there is no formula and no rate card.
Many New Mexicomineral 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.