I just received an oil and gas lease offer on approximately 80 acres of inherited mineral rights in Monongalia County, WV. They are offering 2k per acre and 13% royalty payments. I’m not interested in selling the rights but wanted to understand if this is a reasonable or low offer for this area. Completely new to this and was not tracking our family owned the rights. Any help would be appreciated.
Those numbers are low. I’d push for $3-4K/acre on the signing bonus and 18% on the royalty. So ask for more than that when you make your counter-offer. Gotta have some room to negotiate down.
@EAD definitely a low offer. Make sure you negotiate gross. Also, if you have 80 acres what they always recommend in finance is consider diversification - you have enough to keep some and sell some especially if you have no investments outside of Oil & Gas.
What district are you in? I am working with a group right now that are making much better offers than that.
Remember that solicitation is not allowed on the forum. General information is welcome.
Is this aimed at me? How is stating that I am fielding better offers than that in the same county soliciting? Its stating a fact.
No not particularly aimed at anyone.
If you are a mineral owner and getting better offers, they might be for an area that is in a district with different economic potential so may be higher or lower depending upon location. If you are in the same area as the topic, then sharing is useful.
We have had buyers on the forum who have tried to use the forum for their own economic purposes and directly solicited which is prohibited. Just a reminder to any of them out there scrolling through.
The forum welcomes professionals who share their knowledge for the good of the community.
This topic was automatically closed after 90 days. New replies are no longer allowed.