Protecting Your Asset Before the Close
Mineral exploration is heating up. As commodity prices rise, so does the velocity of project acquisitions. But in the rush to secure “the next big thing,” many buyers skip the most critical step: professional due diligence.
Buying a mineral project without due diligence is like buying a house sight-unseen without an inspection. It might look great in a brochure, but you could be buying a “tear-down” riddled with legal liabilities. In the mining world, what you don’t know won’t just hurt you—it can cost you millions of dollars and years of litigation.
As service providers to the industry, our job is to look past the “wordsmithing” of a sales deck and provide unbiased ground truth. Here are the top five due diligence pillars you must verify before you sign the deed.
1. Title Integrity & The “Chain of Command”
Ownership is never as simple as a single piece of paper. You must verify the Mineral Chain of Title. We look for gaps in historical ownership, undisclosed partnerships, and hidden liens.
- The Hidden Partner: We ensure there aren’t “silent” partners or historical royalty holders who will emerge the moment you start drilling.
- Recording Accuracy: Are the claims properly recorded with both the BLM and the specific County Recorder? If a document is missing from either, your ownership is at risk.
2. The Lethality of Deadlines
In the world of unpatented mining claims, the clock is always ticking. Unlike real estate, where a late tax payment might result in a small fine, missing a BLM maintenance fee deadline kills a mining claim instantly.
- The “Void” Trap: If a seller missed a filing deadline on September 1st, that claim is legally void. It cannot be “fixed” or backdated. If you buy a void claim, you are essentially buying a pile of worthless paper. We verify the active status by checking the records and filings directly. The “active” status on MLRS could be years behind!
3. “Paper Staking” vs. Ground Truth
When exploration gets hot, “Paper Staking” becomes a massive issue. This occurs when a locator files the maps and paperwork but never actually hikes the ground to set the physical monuments.
- The Validity Gap: Legally, if the physical posts aren’t in the ground according to state and local regulations, the claim is invalid.
- Verification: You need eyes on the ground. We check for monument integrity to ensure your “project” isn’t just a collection of imaginary lines on a map.
4. Conflict Analysis: Senior vs. Junior Rights
Ground is rarely “clean.” In active districts, claims often overlap with other mining claims, private ranch land, or federal “withdrawals” (land closed to mining).
- The Conflict Check: We perform a conflict analysis to see who has “Senior” (earlier) rights on the ground you are targeting. Being “Junior” to another claimant can severely limit your ability to explore and develop. We identify these overlaps before you spend your exploration budget defending your right to be there.
5. Logistics & Surrounding Land Use
A high-grade deposit is worthless if you can’t get to it, power it, or permit it. We look beyond the geology to the physical and social reality of the site.
- The Neighbors: We analyze the surrounding parcels. Are you next to a Wilderness Area, a National Forest with restricted access, or private land that won’t grant an easement?
- Critical Infrastructure: We identify the nearest power, water sources, and existing road networks. Knowing the distance to the nearest infrastructure allows you to build an accurate “all-in” cost model for the project’s future.
The Bottom Line
Due diligence isn’t a “cost”—it’s an insurance policy. Spending a small amount on a second set of professional eyes today spares you the pain of trying to “fix” a defective project tomorrow. Make sure your shareholders are happy because you purchased a quality project, not a headache.
Learn more about our due diligence services.
Contact us today to learn how we can help you protect your next mineral investment.
775-335-2053
info@burgex.com