My guest this week is Jarret Kitch, a fellow mineral investor and NARO Texas board member. Jarrett has a really interesting background. He’s worked for a title company, worked as a mineral appraiser for Tarrant County (Texas), worked in the trust department handling minerals and royalties for a major bank, and invests in minerals and royalties.
In this conversation, Jarrett shares stories and dozens of helpful tips for both mineral and royalty owners as well as investors. We discuss the ins and outs of property taxes on minerals and royalties, estate planning, tips for working with trusts, to how he got started investing in mineral rights and what he’s learned along the way. We also talk about his involvement with the National Association of Royalty Owners and how it helped him get started with investing (and where he met fellow investors that he still works with).
This episode is full of so many actionable tips that you will want to make sure to listen to the end and have a pen and paper handy to take notes. Be sure to check out the resources section below because Jarrett shares links to several helpful books and websites!
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About Our Guest
Jarrett is a native Kansan, having grown up around the oil patch and very near the first commercial oil well drilled in Kansas (1892), but never being exposed to the industry until later in life. His first exposure to mineral rights was during an internship with a title company. After moving to Texas and beginning a career as an appraiser for Tarrant County, he was quickly introduced to urban drilling and the importance of mineral rights. His first ownership of minerals came with the purchase of his home. A few years into appraising, he got the opportunity to take over minerals for Tarrant County, and began undertaking major projects to cleanup appraisal / tax records, such as: title verification, locating missing owners, locating unclaimed funds, processing thousands of division orders for ownership changes, discovering wells left off the tax roll, working through complex legal issues including death, divorce, family feud, incarceration, receivership, mass fraud (theft of minerals, elder abuse), pooling, allocation wells, leases split between counties, non-op working interest and joint ventures, tax exemptions, IRS tax levies placed on minerals, government seizures, tax foreclosures, Medicare qualifications and minerals, researching tens of thousands of tax bills with returned mailing addresses, and working daily with mineral owners in all fifty states, and dozens of countries across the world.
Jarrett also worked for J.P. Morgan, where he spent two years working in Asset & Wealth Management, Domestic Trust & Estates, Oil & Gas Accounting. During his time at J.P. Morgan, he worked on various projects involving royalty revenue data, audits, automation of processes, and general accounting.
Jarrett has experience investing in mineral rights and royalties, mostly in Kansas and currently owns interests in a total of twenty-one counties across four states. His first mineral acquisition came at the request to join another NARO member who was also interested in purchasing minerals. Buying minerals faces the same challenges as family ownership / management of minerals. NARO provides excellent opportunities to bring mineral owners together for education, advocacy, and friendship. Jarrett has been a NARO member since 2014.
You’ll Learn:
- Jarrett’s experience growing up in Kansas near where the first commercial oil well drilled in the state is located.
- How he and his family were first exposed to mineral rights.
- What interested him in learning more about minerals and royalties and what led him to work in the industry.
- His experience in working for a county appraisal district and the different challenges between residential real estate and mineral rights.
- The methodologies that county appraisers use to place value on oil and gas royalties in Texas and what you should do if you feel that the valuation is not correct.
- Jarrett’s experience working in the trust department at a major bank and his biggest take away from that experience in terms of working for a major bank and helping owners manage their minerals and royalties.
Tips for mineral and royalty investors:
- His strategy – does he focus on producing properties, oil vs. gas, certain basins or plays, etc.
- What has been one of the biggest lessons he’s learned in getting into investing in minerals.
- How he and his partners source deals.
- Is he still seeing success as a smaller investor in this space or has it gotten harder to find good deals?
- His process for underwriting a mineral or royalty investment and the things he looks at when coming up with an offer.
- Jarrett’s take on the minerals market right now and how things have changed since say 2018/2019.
- Having worked with several mineral owners along the way, what tips he would give to mineral and royalty owners looking to sell some or all of their interests and how can people ensure they are putting their best foot forward.
- His advice for someone who would like to get started investing in mineral rights and royalties.
- What resources he has found most helpful in his minerals and royalties investing journey.
NARO:
- Jarrett is on the board of directors of the Texas Chapter of NARO and has been a member since 2014.
- What led him to become a member.
- How he got involved in a leadership position in the Texas Chapter.
- Some of the benefits he’s realized from becoming a NARO member.
- We’ve spoken about NARO in previous episodes but what would you say to someone who is on the fence about spending the money on a membership?
Resources Mentioned in This Episode
Resources
Books
Other Resources
- The Kansas Oil & Gas Handbook is not available for purchase but may be located in certain libraries or directly from the author David Pierce. He has a number of very good articles about mineral issues not just limited to Kansas available here for free.
- Kansas Title Standards Handbook
- Ownership of Mineral Rights Under Texas Law
- Texas Title Standards Handbook (free)
- Texas Mineral Property Tax Basics
- Oil and Gas Lawyer Blog
National Association of Royalty Owners (NARO):
- National Association of Royalty Owners (NARO) Website
- Upcoming NARO Webinars and Events for Mineral and Royalty Owners (Find registration info for State and National Conventions here!)
- NARO Certified Minerals Manager Program
- MRP 106: NARO Board Member Martha Barnes
- MRP 107: NARO Executive Director Jack Fleet
- MRP 109: NARO Board Member and Landman Katy Alven
How to contact Jarrett
- Jarrett’s email: jarrett@kezeler.com
Thanks for Listening!
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