Jack, I caved in and gave the consent. There is no such thing as a slam dunk in a lawsuit. I could not afford to expose myself to a $5mm liability. My consent language just said I would not unreasonably withhold consent. Even though I thought I was being reasonable, the oil company obviously did not. Next time I will place some hard financial parameters on who can be assigned the lease, such as a Moody’s investment grade rating. Whether I can get it or not always depends upon the negotiating leverage of both parties. If the bonus and rentals are good, then you or I have to decide how hard to stand on consent language. I have always been successful in deleting any pooling authority in my leases. This may get harder to do if a company thinks they will want to drill horizontal wells.
Dave: Thanks for the help. We’re stuck for three years. Hopefully things will work out. On another subject… I just read somewhere that the Saudis reported higher than expected production and exports. doesn’t seem OPEC’s little cut-back scheme isn’t really working… like we ever thought it would.
Jack, without the benefit of seeing the papers or assignment you might have signed, you might not get the benefit of any drilling. Your assignees might now have that right.
Dave: What language do you use… and how did you get the oil/gas company to agree with it? You’re right about all the rest. I’ve never been sued on this issue or any other… so far. An we’ve never withheld an assignment… so far. How did you do in the lawsuit…?
I’m new to this site & having trouble figuring out how to ask a question. I see where I can join in discussions but not how to start one. I own a few acre minerals in Coahoma, Texas. The only description I have is NW/4 of Sec 2 Blk 31 T1S And west half of Sec 2 Blk 31 Township 1 South. It has a well that was drilled in last couple years but not sure if its shut in. We have had it leased before, but since lease was up last year, we’ve had no offers to re-lease. I have an offer today to sell but have no idea if my offer is a good one. The offer is $3200.00 per acres owned. I am feeling I need to sell, but would appreciate any input …I receive small royalty checks about every 3- 4 mos. from Encana. For the past year or so. I’m pretty clueless and don’t know if I should accept this offer or wait ?? Royalties aren’t much & if cant lease again…it’s just sitting there…thank you kindly.
My philosophy is to never sell minerals. Even if not producing, they don’t cost anything to own. However if you only own a “few” mineral acres, then maybe you want to get rid of it. $3200 per acre for minerals seems very cheap to me. Even if unleased for now, that does not mean someone will not come along in the future. I have never regretted not accepting offers to buy my minerals.
Been offered $5ooo per acre to sell, refused at this time. Why would they offer 5K? If they are willing to invest, why shouldn’t I? I’ll wait and just lease.
They would call every few days three different companies but only wanting to buy. Answer…Nope. I’ll hold on
I agree with Ronnie. I am sure there might be a price that I would eventually sell minerals but it would have to be a very fantastic price. My mineral interests are also tied to a family farm that has been in our family for almost one hundred years and that is another reason why I will not sell the minerals. Also keep in mind when you sell minerals, you will most likely be giving the US Treasury around 25% of the proceeds. Bonuses, rentals and royalties are better for me in the long run.
Thank you all for your feedback…I apologize for accidentally hi-jacking someone else’s post. I did figure out how to post my original question and did so in the Howard county. group … @ Prospector: if you could friend me, I would appreciate hearing more about your reasons for thinking my minerals are questionable about certain prices. Thanks
No problem Cathy. I am only questioning those throwing out arbitrary price per acre values without having any experience with geology, petro physics or finance. Or not performing any quantitative analysis not based on heresy for valuations in vastly different parts of the county. ndx_hentz.pdfht Attached is a write up about how the midland basin transitions to Eastern Shelf which happens right along the boundary of where this specific parcel is located. I am not trying devalue your minerals and swoop and offer you a rock bottom price or anything like that. Just making the point that you cannot compare apples to bowling balls.
Wade, I have been very transparent with her on that fact. I mentioned it to her in a separate thread. By all means ignore any math, science or data as it relates to value of minerals. How did you come up with the figure of $20,000 per acre for the parcel in question? Just curious. The article I attached is from the University of Texas bureau of economic geology and is VERY good information for the public to have.
Recent purchases by companies in the region (SM Energy, Double Eagle, Parker & Parsley) have been close to $50,000 per acre. Admittedly those purchases are a combination of producing and non-producing acreage but the individual allocations to tracts in those agreements support a higher valuation.
I completely agree in different parts of the county, not this specific parcel. Also, as you said those prices are for a combination producing and non producing leasehold which exposes you to 3X as much revenue as minerals.
Additionally, they include very expensive equipment and hard goods for operations.
Wade,
What you are saying is that since somewhere in the county minerals have been sold for $20,000 per acre, every negotiation of a mineral acre in the county should start with that figure.
The county is over 900 square miles. That is like saying that a house in Houston sold for $10 million dollars, therefore every house, regardless of location should be valued as such.
Hello all, Somebody help me to understand . NMA that you own is the same as your executive rights which is what is leased every 3 years or so & is as some refer to it as bonus money. Correct? So are ya’ll telling me that the executive rights are being sold at a starting price of 20k per acre , or are ya’ ll talking about the NRI which is also known as the royalty acres starting at 20 k per acre . It is also my understanding that each is a separate entity & can be sold separately . Please explain because I can not understand which is being discussed .
Also, are you not soliciting and acquiring clients from this site?
I suspect you are, as I was contacted by an attorney from your firm (who was not well informed I might add) asking me to make an offer on minerals in the Luther area of this same county.
Agreed, well put Prospector. He is/was not trying to do any underhanded solicitation and as far as I can tell, he was not even trying to make an offer on the poster’s rights. He was simply offering up advice based on his experience in this specific area. I believe Prospector stated his case as to why he doesn’t believe acreage in this specific area was worth $20k+/NMA, but if you can get that Mr. Caldwell, I bet Ms. Hutcheson would gladly retain your services.