I was originally offered $5200 per acre, but now that the title work is nearing completion, the amount has dropped to $2375. Does anyone have any information on how much is reasonable? We’re talking working interest, not mineral interest. Any input would be greatly appreciated.
There really is not a going rate per acre for a working interest. Each location would have to be valued independently. Exact location, current wells and the future liability of such, target formations, what operator currently operating the well, immediate future expected exploration. If title work made the price drop, I would have to ask why if I was evaluating the value. And their price may have dropped to clean up your title issues.
Too many unknowns for anyone to “correctly” answer here. However, I’m not qualified to evaluate the situation if I had all of the information.
I’d start shopping it to the other Working Interest owners in the well. If you have a working interest, you are entitled to the “pay deck” showing 100% ownership in the well bore. The more informed WI holders might know all of the required info to easily make you an offer.
2 Likes
5,200 is a very good price, I have sold some for 2,700/acre. Price can legitimately change as the geological assessment changes. recently somebody offered me 50/acre then upped it to 100/acre - holding out for 1000/acre I have heard of Acres in the Permian selling for 25,000/acre. So the geology and market conditions make huge differences
Thanks, Harry. My buyer is in the ballpark. I appreciate your input.
If you don’t sell, and they drill, you will have an over-riding royalty interest.
Yeah, they’re threatening us with spacing and pooling, but I’ve got a couple of buyers considering buying, so they better hurry up and start the process if they’re going to do it. Their scare tactics won’t work with me.
The current offer we have is on working interest. They are seeking and “Assignment”, which will surrender all of our interest for perpetuity. While this is something we are not opposed to (as a matter of fact, it is our intention to liquidate all of our holdings, since we are tired of the constant paperwork we receive every month sans revenue), we are disappointed with the amount quoted. They’re all over the place with their bonus offers, and we are assuming that is due to geological interpretation of the individual acreages. We’re in a holding pattern while we entertain offers from several sources and while they complete their title work. We have a very sour, negative feeling from all of this, and that’s unfortunate, but perhaps we’re being unrealistic. Hence the origination of my post here. I’d like to know if we’re being naive or just uneducated about the process. We appreciate your input. Two heads are always better than one.
Get back to you in a bit. Driving right now.