I have tried posting a few different times in Eddy County over the last couple months and but my posts remain pending; I wanted to see if it would post here. My family and I recently received an offer from for $51,200 (per person, 5 people total) to purchase our mineral interest in Eddy County, New Mexico (listed as N/2, Sec 8, Township 20S, Range 30E). The letter states an estimated ownership interest of 0.2000%.
We’re trying to understand what the going rate per net mineral acre might be in this area and whether this offer seems fair. We’d also appreciate any advice on what next steps to take before accepting or countering—such as getting an appraisal, reviewing title, or consulting a mineral rights attorney. Any insights or recommendations would be greatly appreciated!
The N2 of Sec 8 20s30e is a Federal lease. NM 0429170. One would guess that you have a override (ORRI) in that lease. This is semantics, but you don’t have any net mineral acres, the BLM has all of the net mineral acres. You do have net royalty acres. Assuming I understand it correctly.
If your people own .2% ORRI in a 320 acre lease, you would have in total 5.12 NRA (320 x .002 x 8). There is no way that your offer is for $50k/NRA, that is much too high, so I am going to assume that each person has a 0.2% ORRI (somebody had 1% originally and it got divided 5 ways) and thus you are being offered $10k/NRA each for each persons 5.12NRA (i.e. $51.2k per person).
In my opinion:
Ask the proposed purchaser how many NRA they think you own. I’d guess it’s a $10k/NRA offer. Have them clarify. Doesn’t mean you have to do anything with them.
I personally think $10k/NRA is too low, if you want to sell, I’d counter at $15k/NRA and see what they say. That’s about where I think a good offer would be, but other’s may have dissenting opinions.
the words “residual oil “…that means fracturing and that means extra $20,000 minimum to YOU on top of anything else in the lease. You may not even want to participate. Don’t let them frac up your land. It destroys surface value and kills livestock. It will kill you also
User41, this site is not made for you to post the same post on every single unrelated post. If somebody asks about leasing in Montana, etc., you shouldn’t go into your editorial about “residual oil.”
I think you’ve made your point, as misguided as it is. If every mineral owner decides they don’t want fracing or fracking, then they will be hard pressed to lease their minerals to someone who finds geology allowing the natural free flow of hydrocarbons without fracking.