In an industry-first move, Allegiance Oil & Gas, with assets under management exceeding $1 billion, is launching Mineral Vault on Plume Network — the first tokenization platform for mineral interests. This pioneering initiative opens up a previously exclusive asset class to global investors by offering direct, secure access to U.S. mineral rights.
Overview of Mineral Interest
In the U.S., mineral interests — often called “mineral rights” — are a unique form of real estate that grants private individuals or companies the ability to extract and profit from natural resources beneath the land. Unlike many countries where the government holds these rights, the U.S. allows private ownership of minerals like coal, lithium, gold, silver, and, most notably, oil and natural gas. These rights can be sold, leased, or transferred separately from surface ownership, creating two main ownership types: Fee Simple Estates, where surface and mineral rights are owned together, and Severed Estates, where these rights are held by different parties.
For investors, mineral interests offer steady income through royalties from resource extraction, making them a valuable and stable asset. This separation of ownership, combined with the ability to lease or sell the rights independently of the land, has positioned mineral interests as a key part of the U.S. economy, especially in the energy sector.
Why Tokenize Mineral Interests?
Mineral properties have long been considered a stable and valuable asset class, offering financial exposure to natural resources such as gold, silver, coal, and, most notably in the U.S., crude oil and natural gas. These mineral interests are a specialized form of real estate that generates steady revenue streams through royalties from the extraction and sale of resources.
However, despite their inherent value, the acquisition and transfer of mineral interests have traditionally been bogged down by significant inefficiencies.
- Title Verification: Verifying the title of mineral and royalty interests has historically been a complex, costly, and time-consuming process. Without title insurance, investors face substantial risks, as discrepancies in ownership records can result in significant financial losses.
- Transfer Administration: Transferring ownership of mineral interests involves laborious administrative steps, such as drafting deeds and dealing with tax authorities and operators. These processes often take months to complete, making the investment less appealing.
How Mineral Vault Solves These Issues with Tokenization
Mineral Vault’s innovative solution — built on Plume Network — leverages blockchain technology to overcome these challenges. Here’s how:
- Tokenized Titles: Blockchain ensures transparent ownership records, but Mineral Vault takes it further by offering a title guarantee on tokenized assets. This protection against pre-existing title defects provides investors with a high degree of confidence in the security of their investments.
- Streamlined Administrative Procedures: Tokenization drastically simplifies the burdensome administrative processes historically associated with mineral interest transfers. By establishing a Special Purpose Vehicle (SPV) to manage the underlying assets, only the ownership interest is exchanged via tokens. This eliminates multiple administrative steps, enhancing liquidity and making these interests more accessible to a broader range of investors.
Why Mineral Vaults on Plume Network?
Allegiance Oil & Gas selected Plume Network because of its scalable infrastructure designed specifically to support the tokenization and management of Real World Assets (RWAs). Plume integrates a crypto-first approach with a traditional finance framework, streamlining the entire tokenization process, including compliance, deployment of digital assets, and integration into a comprehensive RWA ecosystem.
Looking Ahead: Scaling the Tokenized Minerals Market
With the launch of Mineral Vault, Plume Network is well-positioned to scale as the tokenized minerals market expands. As the first blockchain network dedicated to RWAs, Plume’s modular, scalable infrastructure is tailored to handle increasingly complex transactions while maintaining efficiency and compliance.
About Mineral Vault
Mineral Vault is the first ever attempt to tokenize mineral interests, created by the principals of the Allegiance Oil & Gas family of companies, having over $1B in AUM and specializing in high-quality investment opportunities in the mineral rights sector. The Mineral Vault I token represents a pioneering effort to leverage Plume’s RWAfi infrastructure for the tokenization of mineral interests, offering global investors a secure and transparent way to invest in this valuable asset class.
About Plume Network
Plume is the first fully integrated and modular chain focused on RWAfi. We’ve built the first modular and composable RWA-focused EVM-compatible chain designed to simplify onboarding for all types of assets and streamline capital onboarding through native infrastructure and RWAfi-specific features unified chain-wide. For the first time, we are enabling a composable ecosystem of defi built around RWAfis with an integrated end-to-end tokenization engine and a network of financial infrastructure partners for builders to plug and play. We have 165+ projects building on our private devnet today, with everything from private credit to equities, collectibles, and more.