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GROSS ROYALTY TRUSTS

Gross Royalty Trusts receive oil and gas royalties from freehold mineral rights. There are a number of reasons the freehold owner would want royalties paid to the trust instead of directly to himself. The gross royalty trust certificates could be sold or they could be given to family members as an inheritance. The gross royalty trust certificates could also be traded with others to improve the chances of getting a share of a discovery, while the freehold owner still maintains ownership of the mineral title and controls and benefits from leasing the title for a bonus and annual rental payments.