By Prerna Kapoor, CLHMS | REAL Brokerage | May 20, 2026
Quick answer: In Colorado, the rights to what is under your land can be owned by someone other than the person who owns the house on top. These are called severed mineral rights, and they are extremely common across the Front Range and the eastern plains. The mineral owner generally has the legal right to access and extract oil, gas, or other minerals from below your property, even if you own the surface. Before you close, ask the title company exactly who owns the mineral estate, whether there are active leases, and whether any drilling permits are pending nearby.
A couple I worked with in Aurora last spring fell in love with a new-construction home on a beautiful corner lot. Two weeks into the contract, the title commitment came back showing the mineral rights had been severed in 1962 and were now owned by an oil and gas company. There was no active drilling, but the operator had filed a permit application with the state. We worked through it, but it changed how they thought about the purchase. They closed, but only after we got a clear setback diagram and confirmed the nearest possible well site was over 2,000 feet from the house.
This is not a fringe issue in Colorado. The Denver-Julesburg Basin runs underneath Weld, Adams, Arapahoe, parts of Douglas, and most of the eastern plains. If you are buying anywhere in that footprint, mineral rights are a real consideration, not a hypothetical.
What mineral rights actually are, and why they are separate
Real property in Colorado is made up of two distinct estates. The surface estate covers what you can see and touch: the lot, the house, the garage, the yard. The mineral estate covers everything below, including oil, natural gas, coal, gold, and other valuable minerals.
When land was originally patented from the federal government or sold off by early landowners, the two estates were usually held together. Over the past century, especially during the oil boom decades, many landowners sold or reserved the mineral rights separately. Once that split happens, the rights stay separate forever unless someone deliberately reunites them, which almost never happens.
The result is that a huge percentage of Colorado homes sit on land where the mineral rights belong to a different party. In some Weld County subdivisions, the developer kept the minerals when the lots were sold. In other neighborhoods, an oil and gas company bought the rights from earlier farmers and ranchers decades before the houses were built.
Colorado is what is called a dominant mineral estate state. That means the mineral owner has the legal right to use as much of the surface as is reasonably necessary to access their minerals. There are limits, but the starting point is that the person below has rights the person above has to work around.
How to find out who owns the minerals under your house
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The title commitment is the answer. When you go under contract, your title company prepares a document that lists all the recorded interests in the property, including any severed mineral rights, leases, easements, and liens.
Look at Schedule B-2 of the title commitment. This is where exceptions to clear title get listed, including mineral reservations. The language can be dense, but a good real estate agent or title officer will walk you through it. You want to know three things: Who owns the mineral rights? Is there a current oil and gas lease? Are there any surface use agreements (SUA) recorded against the property?
If the seller does not own the minerals, the title commitment will say so. It may reference a deed from many decades ago that originally severed the rights. Tracking the chain of ownership from that severance to today is complicated, and most buyers do not bother. What matters more is whether the current mineral owner is active, meaning leasing or drilling, or dormant.
You can also check the Colorado Energy and Carbon Management Commission, which used to be the Colorado Oil and Gas Conservation Commission. Their public website lets you search by address or section and shows active wells, pending permits, and historical drilling activity. If you see permits filed within a mile of the property in the past two years, take a closer look before closing.
What the 2,000-foot setback rule means for you
In 2020, Colorado passed major rule changes that increased the minimum distance between new oil and gas wells and occupied buildings. The current setback is 2,000 feet from any home, school, or high-occupancy structure. This applies to new well permits filed after the rule change.
What it means in practice is that even if there are active mineral leases nearby, the operator probably cannot drill a new well very close to your house. The setback rule protects existing homes from new drilling, which is a meaningful change from how things worked in the 2010s.
However, wells that were permitted before the rule change can continue to operate at their original distances. If there is already an active well 800 feet from a home you are considering, the setback rule does not push it back. The well is grandfathered in. You can still see, hear, and sometimes smell it depending on operations.
Ask your agent to check whether there are existing wells within a half mile of the home. The ECMC website shows them on a map. You can also drive the area and look for pad sites, which are usually marked with chain-link fencing, gravel access roads, and pumping equipment.
What questions to ask the seller and title company
Before you close, get clear answers to these questions in writing if possible:
Does the seller own the mineral rights to this property? If yes, they will be conveyed with the surface unless the deed specifically reserves them. If no, the title commitment should name the current mineral owner.
Is there a recorded oil and gas lease on this property? A lease means a mineral owner has granted an operator the right to drill. Leases have terms, often three to five years with extensions for active production. Active leases mean drilling could happen during your ownership.
Is there a surface use agreement? An SUA is a contract between the surface owner and the mineral or operator that spells out where drilling can happen, how access roads are placed, and often what compensation the surface owner receives. If an SUA exists, read it. It transfers to you when you buy the property.
Are there pending drilling permits within a mile? The ECMC public database will show this. If yes, your agent should help you understand what stage they are in and what the setback distances are.
Does the HOA or developer retain mineral rights? In many newer subdivisions, the developer kept the minerals as a separate asset. Sometimes the HOA holds them in trust for the community. This is generally lower risk because no individual operator can act unilaterally, but it is worth understanding.
Title insurance, financing, and what to do if you have concerns
Standard title insurance does not generally cover mineral rights issues. If you want protection against future losses tied to severed minerals or surface use, you have to ask for extended coverage and pay extra. Talk to your title company about a mineral rights endorsement or what they call ALTA coverage. The cost varies but is usually a few hundred dollars and worth it if minerals are a concern.
Lenders do not typically refuse to finance a home because of severed mineral rights. They will, however, sometimes require additional disclosures or insurance. Conventional loans usually proceed without issue. FHA and VA loans have specific requirements about active well proximity, so ask your loan officer if you are using one of those programs and there is drilling nearby.
If you find out about an active or pending oil and gas operation during your inspection period, you have options. You can renegotiate the price to reflect the risk, ask the seller to disclose any communication with the operator, or terminate the contract under your inspection objection if it is something you cannot live with. Colorado contracts give you a window to make this call. Use it.
For Japanese buyers especially, this is one of those areas where the cultural assumption that buying a house means owning everything below it does not match Colorado reality. The legal split between surface and mineral estates is a US concept that has no direct equivalent in most other countries. Take the time to ask questions and understand what you are actually buying.
If you want a second pair of eyes on a title commitment or you are not sure what to ask about a specific property, send it over. I am happy to walk through it with you and connect you with a title officer who can answer the technical questions in plain language.
Prerna Kapoor | REALTOR® | Luxury Home Specialist
REAL Brokerage | 720-949-5450 | info@prernakapoor.com
CLHMS • RENE • PSA • ABR | International Sterling Society Award Winner
Prerna specializes in residential real estate across Parker, Aurora, Lone Tree, Castle Pines, Highlands Ranch, Cherry Creek, Greenwood Village, and Centennial. She speaks English, Japanese, and Hindi.
