We've received an offer of $191,000, good for 45 days, to sell our mineral rights to 766 acres located in Union County, Arkansas. My questions:
1.) Is there oil or gas speculation underway in Union County?
2.) Since MPH Production is an intermediary, what oil and gas companies are currently speculating in Union County?
3.) Is this a fair price, should we decide to sell?
4.) Should we hold on to our leases?
Lion Oil and Pinebelt currently hold rights to dig on other properties in Union County so I doubt whether it is either of them.
Many thanks, Anne Edwards
If you are not desperate for the money, I would hold on to the leases. If you are desperate I would only sell as much as necessary to meet my needs. If any sucessful drilling happens near your interests, your next lease agreement may pay you as much as this offer, or more, and you could be receiving checks for 30 years besides. Lastly, many times there will be an offer made just prior to drilling or a division order being sent out, so I think you asked the best question of all " is there activity, or activity planned for the near future", this offer could constitute the hail mary last ditch attempt to to make an even larger killing off of what used to be your minerals. If you are seriously considering this offer I would use all the time allowed and bend every effort, even spend some money on professional help, to make sure drilling hasn't happened or is just around the corner. Good luck with your descision.
MPH is a company that buys minerals. Usually when there is some action in the area these companies send out letters trying to buy mineral rights for chump change and alot of people sell without realizing what they are selling away especially with all the new oil and gas exploration and with the new techniques in drilling.
Currently this week there are 35 drilling rigs in Arkansas with 3 rigs working in Union county. $223 an acre in a very lowball price to sell your minerals. From experience i sold 10 of my 25 acreas of minerals back in the 80's when i first got married but i was smart enough to keep 15 acs.. They are currently drilling a 18,000 ft. horizontal well and if i had those extra 10 ac. i could have given my grand daughter those 10 acs. and it would amount to nice size education fund for her at 18 and she is just 6 now.
We have received letters over the last few months offering up to $3000per ac. to sell, the letters just went into the trash. I would just say KEEP YOUR MINERALS and some thing may eventually happen for you or maybe your kids or grandkids.
Thank you for your prompt response......your advise makes good sense.
r w kennedy said:
If you are not desperate for the money, I would hold on to the leases. If you are desperate I would only sell as much as necessary to meet my needs. If any sucessful drilling happens near your interests, your next lease agreement may pay you as much as this offer, or more, and you could be receiving checks for 30 years besides. Lastly, many times there will be an offer made just prior to drilling or a division order being sent out, so I think you asked the best question of all " is there activity, or activity planned for the near future", this offer could constitute the hail mary last ditch attempt to to make an even larger killing off of what used to be your minerals. If you are seriously considering this offer I would use all the time allowed and bend every effort, even spend some money on professional help, to make sure drilling hasn't happened or is just around the corner. Good luck with your descision.
Mr. Pruitt, Thanks so much for the update on what's happening in Union County; it's extremely helpful and valuable to us in making a decision about our leases. There's nothing like eyes and ears on the ground! Anne
Richard Pruitt said:
MPH is a company that buys minerals. Usually when there is some action in the area these companies send out letters trying to buy mineral rights for chump change and alot of people sell without realizing what they are selling away especially with all the new oil and gas exploration and with the new techniques in drilling.
Currently this week there are 35 drilling rigs in Arkansas with 3 rigs working in Union county. $223 an acre in a very lowball price to sell your minerals. From experience i sold 10 of my 25 acreas of minerals back in the 80's when i first got married but i was smart enough to keep 15 acs.. They are currently drilling a 18,000 ft. horizontal well and if i had those extra 10 ac. i could have given my grand daughter those 10 acs. and it would amount to nice size education fund for her at 18 and she is just 6 now.
We have received letters over the last few months offering up to $3000per ac. to sell, the letters just went into the trash. I would just say KEEP YOUR MINERALS and some thing may eventually happen for you or maybe your kids or grandkids.
This company knows something that you don't. I know of a man in our community who was approached by the oil company to sell his minerals about 30 years ago. He purportedly sold them for $50,000 and after the well was drilled, it was the best gas well in the community. This man lost millions in royalties and did regret his decision. The oil company probably had seismic data that showed something really big before they ever made him the offer.
I sold some land, but reserved all of my minerals.