I have just over an acre and a half in Midland, TX that has been leased for a term of 3 years. The terms were seemingly favorable with 25% royalty, and I’m not to bear extra costs taken out of royalty. There is just over a year left on the lease. Nothing has been done yet that I am aware of, but I’ve been led to believe there might be drilling in approximately 6 months.
Another company has offered to purchase my lease rights for 18,000/acre. Therefore, I am posting here seeking some guidance on whether or not I should sell these rights, or simply keep the rights for future drilling.
What are the chances drilling finds something in this area, and what sort of output should I expect in terms of monetary value, and how long does it generally take to reach and eclipse the 27,000+ I could receive up front?
Then there is factoring in that drilling might start in 6 months, but there is only just over a year left on the lease. Thank you for any thoughts and advise on this type of situation.