A family member owns 60 acres of mineral rights in Loving County (Delaware Basin), specifically Block C24, Section 24. My questions are as follows:
1. How can we secure a copy of the Abstract? Is there a specific website? We have the Abstract number.
2. What is the average current offering for the sale of mineral rights? I found RSP Permian paid $48,157 per acre earlier this year. We have been contacted by two companies seeking to purchase in the $30-40,000 per acre range.
3. We leased the property about 3 years ago to RSP Permian and the first lease payment and royalty checks are about to be paid. What are the current average lease and royalty payments on a per acre basis.
Our family has up to 112 acres in Block C24 Loving County, Sections 4, 5, 6, 7, 12, 17, and 18. Some family members sold their sections for $23,000 each recently. Some others are selling one-half their interest, while others are waiting to see what the market brings.
One company has offered to do a three-year lease (approximately 18 acres) for $9,000 a mineral acre.
I have also received offers to purchase my mineral acres, with the range from $17,000-$23,000 (the more you offer up for sale the higher the price per acre).
It is good to know that there are companies out there willing to pay more per acreage than what I listed here.
What dollar amount did RSP Permian (or other companies) offer to lease your acres?
We have not received our first lease check. We are completing the paperwork now. First check is due next month. We have a total of 60 acres, but only planning on selling half.
Thanks, Lou, for the quick response. Could you tell me the lease offer (amount per mineral acre), not the royalty check? We are trying to negotiate right now with companies about our acres that become available for lease this coming August.
I can, as soon as my bookkeeper gets back (1 hour).
I did have a question on your "One company has offered to do a three-year lease (approximately 18 acres) for $9,000 a mineral acre.". Can I assume this was a lump-sum amount and based 18 x $9,000 the lump sump was $162,000? Was there any royalty percentage?
Yes, the $162,000 is the total lease amount. We have a 25% royalty percentage. I think this company may be "flipping" the lease, though, to interested drillers rather than drilling themselves.
Plains Natural Resources: Current Lease for 30 acres dtd Jan., 23, 2016. Paid $60,000, plus 1/4th royalty. Lease runs for minimum of 3 years or to Feb., 23rd, 2019.
Thanks, Lou. It looks like Plains paid $2000 a mineral acre to lease this property. It's amazing how much prices have gone up. I remember when we first leased our acreage in 2008; we were happy to receive $350-500 an acre.