Does anybody know what the average price being paid for mineral rights in weld county Colorado around Greeley? For 80 mineral acres with a producing oil and gas wells which are vertical only and mineral rights owner collects small 12% royalty checks monthly?
Bill,
I've evaluated Weld county mineral acreage that ranges from a liability to sever thousand dollars/acre.
It is very site specific and in your case, will hinge on the exact location, well performance, producing formation, and most importantly the anticipation and probability of things to come. Like real estate, price is mist dependent on location, location, location, and with mineral rights; potential potential potential. Buyer's acceptance of risk takes over from there.
Contact me directly if you like and I'll try to give you a quick range of values.
Thank you Gary. I appreciate your comments and thoughts These are out of the Codell formation just north of Greeley and low producing now and not much horizontal activity at present. A liability I hope not as an oil company is paying costs now i assume but I had heard around 600per acre was about average. Bill
There is no way to "average" but a arithmetic mean for purchase of 3/16 RI leased land may be $1000/acre from what I have seen and evaluated. But again, each property is going to be different and I assume you know about using averages and means for decision making. Also keep in mind that many operators use the minuscule Codell production to keep leases HBP. Its good business for them but sometimes its abused. The good news is that the Niobrara is a permeability trap for the Codell in many areas of Weld. Consequently the Codell driller knows exactly the potential of the Niobrara above. New COG rules being put into effect may adversely effect the smaller mineral owners. Hopefully your operator is a major player in the area.
Gary H
Bill Leinheiser said:
Thank you Gary. I appreciate your comments and thoughts These are out of the Codell formation just north of Greeley and low producing now and not much horizontal activity at present. A liability I hope not as an oil company is paying costs now i assume but I had heard around 600per acre was about average. Bill
Bill,
I buy mineral rights and royalties. If you are thinking of selling we will do a quick and free evaluation, at least tell you what we'd pay for it. Producing minerals will typically trade on a multiple of cash-flow based on the current production and the promise of upside, if any. Non-producing Minerals usually sell on that $/ac number you were asking about. The Niobrara exploded $/ac prices in 2010-2011 county wide, but as it turns out many Exploration companies have abandoned the play and there are a few really great hot spots, unfortunately, North of Greeley is not one of them. You can contact me at hburdick@overlandoil.com if you what to communicate further.
Hunter-
Thank you again Gary I am going to have to educate myself more Its an old well so not sure why they are down a little deeper in Codell instead of niabara but it would be nice if they decided to spend some big money on it and go horizontal
Thank you Hunter. I am more of a buyer than seller
Amen,
It has only been in the past few years that horizontal drilling and fracing of the Niobrara has been possible technologically. The economic return jury is still out and will be for a few more years. For the the past 30-40 years the Codell has been a slam dunk source. Note I didn't say "economic source" Most wells going back to 1950's were testing the J Sand which is below the Niobrara as well. Sometimes the D sand was productive but the "J" was the big potato.
Keep in touch.
Bill Leinheiser said:
Thank you again Gary I am going to have to educate myself more Its an old well so not sure why they are down a little deeper in Codell instead of niabara but it would be nice if they decided to spend some big money on it and go horizontal