Horizontal Spacing


Hi Todd. 40 acres, the original lease says 3/16th. I have found one lease for sec 29. He owns minerals in sec 32 and 28 also but I cannot find the lease agreements for those sections.


Connieg–conventional wisdom says never sell mineral rights in Oklahoma. There are exceptions where you need cash. But in the long run you are better off keeping what you own. What if your ancestor had sold his/her minerals to buy a mink coat?


Mr. Frank: “But in the long run you are better off keeping what you own”. Can you explain this piece of advice? Would it have been better for all the people if the Federal Government or State of Oklahoma, had not sold any of the minerals with the land whenever that occurred?

Just wondering where we would be if not one person, ever sold what they owned, inherited or otherwise, for whatever purpose they so choose.

Todd M. Baker


Hi Frank. I am trying to figure out the reason for the 4 thousand dollar spread. My son received an offer about 6 months ago and it was a straight 25 hundred dollar offer per acre, but you had to have a certain royalty interest in order to get that amount. I know here in Ohio, things went wrong for some of the people that did lease agreements. For the people that sold, they are at peace, no attorney fees and no running to the local recorder to find the newest operator of your lease.



No real answer for your question of the $4K spread. You would have to ask the folks that sent the letter. However, the higher the royalty, the more proportionately higher the offer.

Todd M. Baker


Connieg…Most initial offers are low. The closer to time for a well to be actually drilled the offers go up. There are also those out there that plan on buying minerals low and selling them for a profit.


Sure. First, read in context we are talking about mineral rights, not Malibu beach-front surface. More to the point we are talking about minerals in Garvin County, Oklahoma, although it could apply to all of Oklahoma.

There is no annual property tax on severed minerals, so it doesn’t cost you anything to keep them, unlike some other states. Second, show me a buyer who is willing to pay more than some discounted estimated present value of current production. The buyer gets all of the future upside, and the seller gets cash which has only a relatively small upside.

Fifteen years ago the Woodford shale was generally not a viable prospect. The Woodford 15 years ago was, it turns out, valuable upside. Todd, you may be a mineral buyer that doesn’t like educating mineral owners, but in all fairness they should include that future unknown upside in their decision to sell or keep.


AMEN!!! my brother well said.


Thank you Frank. Your latest post has really put things into perspective. We are going to keep the minerals, they have been in the family for years and it would be a shame to sell them now. Darla mentioned in her post companies are buying low and selling for a profit later, so I am sure there would be some type of a problem with our minerals that would put us on the low end . Thank you all for your comments.


I take offense to you comments about education, Frank, but that is OK. Those I deal with no better.

My problem with some folks is they make blanket statements like “never sell your minerals”. If you read what I have said in the past, there are reasons, very good reasons in fact, to sell minerals, just like there are very good reasons to sell lots of things. If you look hard enough Frank, you will see my comments here that “if you have a reason to sell, do it. If you don’t, don’t.”

Your example of “fur coat” is ludicrous.


Frank, even though you say don’t sell minerals anywhere in Oklahoma but I, my brother and sister have 40 acres each that we would like to sell in Delaware County. Nothing going on there but you never know. Interested?


The difference might be according to how much he owns and at what percentage (ie: 1/8, 3/16, 1/5 or 1/4) he is leased. Just a shot in the dark. If he wants to sell he can always ask for more. My advice is ask for more than you think they will pay to start with and they might either counter offer or take your offer. But my advice is worth just what you are having to pay for it. lol Best Wishes!


In your analysis, wanting a fur coat is a “reason to sell”–just not a very good reason. There are lots of other “not very good reasons” to sell an asset with long-term upside, and no carry.

It is apparent that some of the parties posting here are new to mineral transactions, and vulnerable to the temptations of what they perceive as a large wad of cash being flashed in their faces. In my experience many of them have never even heard of discounted present value of an income stream, and have not thought about capital accumulation.

Selling minerals based on the income stream of current/anticipated production is only a portion of the value of the asset. All of the wealthy mineral owners that I know put a high value on the unknown future value of their minerals when contemplating a sale, but a zero value on that unknown future value when buying.

Sam Noble had a couple of applicable adages: all real wealth comes out of the ground; the best place to find oil is where you have already found it.

My goal is to expose potential sellers to the full extent of what they are giving up, not to get in your rice bowl.


The Sierra well on sections 32 and 29 of 4n 3w in Garvin is being fracked at this time according to relatives that live out that way in the Hughes area.