Hi Everyone,
I Have some unleased minerals I’m considering selling. I’d like to get a rough idea of how much they’re worth before I put them on the market.
I was told that one way to get a rough value is to look at the cash consideration amounts on nearby pooling orders and lease bonuses. How do I use those numbers to find the market value?
Thanks!
The pooling values are not all that helpful for market value for a sale. They are mostly helpful for leasing. The market value depends upon if you are leased, the net mineral acres and the royalty amount, type of well(s) (conventional or horizontal) and age of the well(s) and future value of more infill wells. Some buyers like unleased minerals and will pay more for them if they are in a good area. Unleased minerals in a poor area are unleased because they are not economic, so the mineral acres are not worth much at all.
Pecan Tree listed in the Directories tab above has a tool that is similar to Zillow but for mineral acres. You might check that out. If you are in OK, you can look up sales in your area and use the document stamps to get an idea of the sales prices. Can tell more about how that works if you need it.
Most folks use decline curves of the wells nearby to estimate reserves.
Wow thanks! I’ve never heard of Pecan Tree but I just played around with it and it looks really helpful. I’ve used the method of looking up mineral deeds and transfers in county records and trying to calculate the sale price. That gets really time consuming. LOL
Do you feel like the Pecan Tree value ranges are pretty accurate? I’ve worked in real estate for several years buying and selling land. I’ve tried several of the websites/online services that are supposed to help buyers and seller put values on properties. They’re VERY hit and miss and really, for most areas of Oklahoma, their value numbers are so far off that they aren’t worth wasting time with.
The value ranges in Pecan Tree are pretty wide, but if they’re pretty accurate they’ll be close enough for what I need to do.
Tracy is a very experienced petroleum engineer, so her estimates will be based upon data and should give a fairly accurate range.
Her results vary from pretty accurate to way off. You can search forum for peoples past experiences.