Owning land in Ontario does not necessarily mean you own everything beneath it. Surface rights and mineral rights associated with the same property may belong to different parties. This article explains how those rights differ, how to determine who owns mineral rights, how mineral rights can be acquired, and where disputes may arise.
Understanding Surface Rights Vs. Mineral Rights
Surface rights generally concern the use and occupation of the land’s surface. Mineral rights concern minerals located in, on, or beneath the land.
These interests can be “severed,” meaning one party owns the surface while another holds the mineral rights. A mining claim does not automatically give its holder ownership of the surface. Instead, it provides certain exploration rights and the opportunity to proceed toward a mining lease, subject to the requirements of the Mining Act.
How To Determine Who Owns The Mineral Rights
A title search may identify reservations, exceptions, leases, easements, or separate ownership of mining rights, but the surface title alone may not provide the full picture. Historical patents, mining records, and other documents may also need to be reviewed.
Ontario’s Mining Lands Administration System (MLAS) can provide additional information. Its public Map Viewer shows active unpatented mining claims, while MLAS contains records related to mining claims, leases, and other forms of mineral tenure.
A review may involve:
- Searching the property title and historical instruments
- Reviewing Crown reservations
- Checking the MLAS Map Viewer
- Identifying registered mining claims or leases
- Confirming whether surface and mineral rights are held separately
MLAS is a useful research tool, but it does not replace a legal title review. Licata Law can assist with reviewing title and mineral interests.
Acquiring Mineral Rights From The Crown
In Ontario, eligible mineral lands may initially be acquired through the registration of a mining claim. Ontario uses a provincial cell-grid system rather than traditional ground staking.
To register a claim, a person generally needs a valid prospector’s licence, an MLAS account, and a cell that is open for registration. Some lands may already be claimed, withdrawn, or otherwise unavailable.
Registering a mining claim does not authorize commercial mining. Claim holders must complete required assessment work and meet other obligations to keep the claim in good standing. A mining lease may eventually provide rights to extract and sell minerals, but additional approvals are generally required before a mine can be constructed or operated.
Private Mineral Rights: Leasing And Royalties
Privately held mineral rights may be sold, transferred, optioned, or leased, depending on the title and the parties’ agreement.
A mineral lease may address:
- The area and minerals covered
- Exploration and surface-access rights
- Term, work commitments and termination
- Environmental and rehabilitation responsibilities
- Assignment and transfer rights
- Payments and royalties
One possible structure is a net smelter return, or NSR, royalty. How an NSR is calculated depends on the agreement, particularly which costs can be deducted before the royalty is determined.
Because small drafting differences can have significant financial consequences, royalty provisions should be reviewed in the context of the complete agreement.
Common Legal Disputes Over Mineral Rights
Mineral-rights disputes often arise over ownership, access, or the activities permitted under an agreement or mining interest.
Common issues include:
- Conflicting ownership or claim records
- Unauthorized entry or alleged trespass
- Surface-access and right-of-way disputes
- Damage caused by exploration
- Royalty calculations
- Failure to complete agreed work
- Environmental or rehabilitation obligations
These disputes can involve property law, contracts, mining legislation, and regulatory requirements. Reviewing the title and governing documents early can help identify the source of the disagreement.
Protecting Your Interests With Legal Counsel
Legal review may be useful before buying, selling, financing, or developing land affected by mineral interests.
Counsel can review title records, mining tenure, access rights, leases, royalty provisions, and transaction documents. For mining businesses, legal work may also extend to corporate structuring, project investment, and financing arrangements.
Learn more about working with a mining finance lawyer at Licata Law.
How Licata Law Office Can Help
Licata Law Professional Corporation provides legal support for Ontario mining projects and related commercial matters.
We can help clients identify property and mineral interests, review agreements, and address legal and regulatory issues affecting a project. Contact us today.
FAQ
Do mineral rights expire?
It depends on the type of interest.
Private mineral ownership does not necessarily expire because the minerals have not been developed. A registered mining claim, however, must be maintained in accordance with Ontario’s statutory requirements.
Can the government take back mineral rights?
Certain mining interests may revert to the Crown through forfeiture, termination or other processes authorized by law. Ontario also publishes information about lands and mining rights that have returned to the Crown and may become available for claim registration.