Hi everyone, We currently have an offer from Pony Oil, LLC out of Texas. Extraction Oil currently is typing up division orders to send to us for signature as the property title issue was just resolved in probate. Pony Oil is offering $9,000 per mineral acre and we have 3 days (by June 21st) to sign this offer letter. Property description: Township 01 South, Range 68 West, 6th P.M. Section 9: Lot 8, Block 2, Northwest Estates Because we haven’t yet received any past royalty checks from Extraction or the new division order, do we still have the right to sell to Pony Oil? Also, shouldn’t we wait till all papers from Extraction are in order before we sign anything with Pony Oil. Please help asap!!!
Personally, any time someone wants to rush me, I put the brakes on until I know all the data I need to know. If it were me, I would find out from local folks what those wells are worth before I sign any sales agreement. In my experience, all offers I have received have been below the actual value of my wells. They want your royalties from the current well and any future wells. That is what you are giving away. If you just are finishing probate, you should have the executor give you an engineering valuation of the mineral rights for a more accurate value. You will have to have it if you sell in order to calculate the capital gains tax. I am a firm believer in getting all the ducks in a row before making any decisions.
Thank you for your opinion. Anyone else out there who has anything to offer?
Thank you, we will call later this afternoon.
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Thank you M Barnes, we did put the brakes on because of your suggestion and will wait till we have recieved all the information from the current lease company before we make any decisions. Thank you again!!!
Smart move Becky. Sounds like you have a well drilled on you and are waiting for all the house keeping to get in order before they pay out royalties. I’d just wait and see what the production checks are rather than have Pony cash you out for a lump sum at this point. You will have more data points on what it is worth and you can always cash out later if you wanted to.
Thanks for the kudos Smith_Ranch!!!