When you get an offer for you mineral rights, is there a way

General Mineral Rights Discussion
1

Hi all,

First post to this forum. But nosing around, I've found it very informative. Thanks to everyone who have posted questions, and especially those who've taken the time to post answers.

My family has received royalty payments from producing wells in Brazoria County for over 50 years. And as long as I can remember we get unsolicited offers for our mineral rights from various companies. We have always turned down these offers. And that's always proven to be the wise move. Some of these offers are so low they're a joke. Some are more serious and substantial.

What I want to know is this: When the actuaries at the established companies are evaluating our mineral holdings, they're making an educated guess at how much the reserves are worth. Then they offer us a fraction of that evaluated worth, right? Is there a "standard" fraction that these companies offer? For instance, if they offer $X. Does that generally mean they believe that the long term value of your mineral property is 10X or 3X or 100X? Which one? I realize the low-ballers aren't serious and probably don't know. But the established companies who make substantial offers have done their homework.

Wish I knew what was in that research they've done.

Robert

2

I too get offers rather frequently.

It looks to me like the offer is generally at or close to the tax assessment.

Some of the offers include a deed. The deeds i have seen include all interest owned in the particular county. If i am correct that many of the offers approximate the tax assessment, and the tax assessment is based on production, non producing minerals, if any, will be conveyed, potentially without the Grantor fully knowing what is being conveyed. Be careful.

3

Ahh, ok, so they're generally just going by the tax assessment. That makes sense. The last offer did include a deed. Thanks for the reply.

Robert