I received an offer to sell my oil and gas lease in Roger Mills county ok to a Landman.
Do you have a particular question? It is always wise to find out what activity is happening your area before answering an unsolicited request to buy. If you want to share the section, township and range, the forum can help with information to help you make a better decision.
The legal description from the Landman is: SW/4 nw/4 and N2 SW/4 and SW/4 of Section 13-15N21W
He is saying my portion is 1/30th and is offering me $5,550.00
I am trying to find out if this is a fair price.
That location is in Roger Mills County which is very different than Rogers County. Personally, I would not sell, because you have a new horizontal well permit by Mewbourne. Ruben Rivers 24/13 PA 1H. And they have positioned that first horizontal well to leave room for multiple infill wells down the road. Horizontal wells generally pay much better than vertical wells. Are you getting paid on the Teocalli age 3-13 well now? Most offers to buy are for a fixed number of years for the production from a current well and maybe a new well. I like to hang onto my minerals for longer term and get payments for decades instead.
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….DONT EVER SELL !!!….. unless you’re in absolute and extreme Dire Straights.
I’m a recipient of heired leases from 75 years ago bc someone knew that they were great spots. Turns out they were VERY GOOD spots and I’m thankful to my great great grand dad for buying and keeping them.
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I have never understood why people sell their minerals. They aren’t charged taxes on them and if people are willing to pay enormous amount for them they know they can make more. More specific in a hot area like everyone is in. I heard one person got her first royalty check from two months of production after division orders got done and got over 2 million dollars. Not sure how much minerals she had but divide that into the amount of minerals you own.
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A sale has some definite advantages, given the right circumstances. Number one, you generally get paid in a lump sum rather than receiving royalties over many years. Secondly, a sale usually qualifies for capital gains treatment rather than ordinary income.
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The really bad thing about selling them is you give up everything for your future generations if your a family ranch or farm. It’s getting harder and harder finding land today with minerals with the surface. Pretty soon surface owners want have anything to say or any income from wells on their property while paying taxes on it. Are you willing to pay property and schools taxes multiple locations of 8 to 10 acres with only one time surface damages for the life of a well? I will not do this to my kids or grandkids or someone else looking to buy my place if I ever sell it. If Texas ever had a law like Louisiana where the mineral can only be held for 10 years then have to be returned to the surface only. Then it would be different. I really find if minerals are held by someone that’s not the surface owner should have to pay minerals taxes even if there no productions.
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Those are all excellent good points. But what if there’s no commercial oil or gas in your minerals. What did u wait for
You never know what time will bring. Now with lithium been taken out of salt water that a market that just opened up. If you didn’t have minerals rights you wouldn’t get anything from that. You can’t look short term if you plan on keeping the land for future generations. Technology is always improving.
If your needing money their is companies that will loan you money on your minerals and you can pay them back.
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What brine. No drill no brine
There is a price where you should definitely sell that, and a price where you should definitely not sell that. Nobody here told you if its fair or not, and that is very typical, people will mostly just voice their internal monologues on why you shouldn’t sell. And maybe you shouldn’t.
So if I am reading it right, you own 1/30th of….40 acres + 80 acres + 160 acres. Around 9 mineral acres. Presumably leased, since you called it a lease. Presumably at 25%. So maybe its 18NRA (9 x 25%/12.5% = 18)
Here is a map of this area. Mewbourne and Crawley are drilling wells to the SE of you. They are deep wells in the Cherokee formation. They seem to make about 100-150,000 barrels of oil in their first year online and a decent amount of gas.
Let’s say they drill one well in Sec 16 and 21. You would own lets say 18/1280 * 1/8 = .17% of the well. Which if oil is $60 a barrel and it makes 100,000 the well makes $6M of total revenue in year 1 and you will get $10k of it. In the first year. From one well, and there will likely be more.
So, no, based on what you said the “fair” price to sell those minerals is much higher than $5500. I would say it’s over $40-50k. That is one person’s opinion on the internet, but it’s based on some math and some assumptions in that math. You can always ask the landman to clarify what they are offering per NRA, that’s usually a helpful number to have to compare offers over time.
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I think what’s being missed here is the thrill of being leased and watching your big well come in that’s going to make u rich beyond your wildest dreams.
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My dreams are wild as hell. Oh wait, I’m old. They now mostly involve having 32 teeth and hair and finding a ripe avocado. 0 for 3, sir.
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No one said it was going to be easy. Have an energy drink
Thanks for explaining NRA. Where did you get the picture? Is that wells that have been drilled, or that are proposed? Can you please post a link? Thx.
First thing u need is Google earth and the distance map
That is wells that have been drilled. It was from Enverus which is a pretty pricey paid subscription service. So behind a paywall.
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If the line goes across two sections , does that mean it’s a two mile drill? I see one line that goes across 4 sections. What’s the legend?Some are a star and some are just a dot.
Are they building new pads or using existing pads? Are they drilling 2 wells off a pad or 4?
Are they ever going to get into 14-21?
TIA!
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Im assuming the $5,500 offer is per acre, so 9.3 acres x $5,500.00 = 51k which would fall under your paramters. If you are saying minerals are worth 40-50k per acre, thats a whole different story and every person in the area should sell. $5,500 an acre for it all is a dang good offer for the area, as the acreage, if drilled upon will be pooled with another section and not get 100% of allocated value, which is a much more complex situation thats often not taken into account on here when it comes to selling vs holding.
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