Anyone ever sold their mineral rights?

[Lammie]

I had an offer, and I must say, that although I had really never thought about doing it before, it sounds like the "bailout" I need at the moment. I have not received an dollar amount, but I am interested to know how much they might offer and whether or not it would be a good idea, given our, meaning mine and the country's, economic situation at the moment.

It only purchases the rights to the leases I am currently on. It would not include future new leases. I don't think, if I read it correctly.

Guess I need a lawyer.

Feel free to throw in your cautionary tales and words of wisdom.

 

[1982vett]

I had an offer, and I must say, that although I had really never thought about doing it before, it sounds like the "bailout" I need at the moment. I have not received an dollar amount, but I am interested to know how much they might offer and whether or not it would be a good idea, given our, meaning mine and the country's, economic situation at the moment.

It only purchases the rights to the leases I am currently on. It would not include future new leases. I don't think, if I read it correctly.

Guess I need a lawyer.

Feel free to throw in your cautionary tales and words of wisdom.

The offers I get usually are based on recent production x 36 months. In other words 36 times the latest production reports. Usually get several offers each year or right before new work starts in the area. In my opinion, the offers are tinsel on the Christmas tree. Spark and glitter are nice, but it is what is under the tree that counts. Unless of course you get a dry hole, then the offers are money in the bank. Don't think I would ever sell mineral rights or water rights. But that is just my opinion.

 

[Running Arrow Bill]

I would never sell mineral rights. Only "lease" options for an oil/gas company to drill.

IF they found natural gas on your property (especially if you're in the Barnett Shale), 2 or more producing wells could produce annual royalties for you in the six figures amount.

Think before you leap.

Always use an attorney for any mineral stuff...

JMO

 

[back40]

What are leases running in Texas? I recently started another thread on this subject. The lease we had been offered then - $250 an acre - fell through but since then I have been contacted by a couple other companies. We are in South Central Texas.

 

[Lammie]

What are leases running in Texas? I recently started another thread on this subject. The lease we had been offered then - $250 an acre - fell through but since then I have been contacted by a couple other companies. We are in South Central Texas.

Depends. I read lately that it was going down, but you should be able to do better than that. I heard in the neighborhood of 5K. I leased two years ago, so prices have changed since then. It's negotiable. Hold out and see what happens. I know our first offer fell through and the next one was considerably higher.

 

[Texas PaPaw]

Here's a site where you may get more feedback:

http://groups.google.com/group/Royalty-Owners-of-Texas

Most discussions are related to the Barnett shale.

 

[Bluestem]

What are leases running in Texas? I recently started another thread on this subject. The lease we had been offered then - $250 an acre - fell through but since then I have been contacted by a couple other companies. We are in South Central Texas.

Was just offered 6500.00 acre for a 2 year lease plus 1500.00 for the third year if needed. 25% royalty. With no drill clause. This was in the Barnett.

 

[skyline]

Lammie, I get those offers on some property that I own in Panola County. I would be careful. My feeling is that the folks making the offers have researched activity in the field and know a heck of a lot more about what is coming up than I do. I figure they wouldn't be making the offer if they didn't think they could make some large $ off your mineral ownership in the next 3 to 5 years.

As for me, selling off my minerals doesn't fit into my long term plan. Mailbox income is very hard to come by.

 

[Jim62]

I agree with Skyline. If an oil company is willing to pay $25 or $30 grand for my mineral rights, I figure they're pretty darn sure that they will make money on the deal, and they have a lot more information at their disposal than I do.

I'm into that "mailbox income", too.

 

[backhoeboogie]

Guess I need a lawyer.

It is going to be up to you in the end.

Some lawyers will tell you to sell in case of a dry hole. One sis has one telling her to sell or sell atleast half of some holdings since it is a sure thing. They want the Bland on an all or none. Big offers and this sis is trying to talk the rest of my siblings into selling. I'm sick of it. Another sis has offered to buy her out and she doesn't want to sell. Go figure. It did shut her up finally.

No way in hades would I sell Haynesville or Barnett.

 

[Weaver]

We deal or did deal with the coal mining companies around here. I know back in the 70's and 80's the coal mining companies bought ground for 10,000 an acre to strip mine the ground. Heard last year of one company about 10 miles from here paying $10,000 an acre to a landowner for right to dig a pit and high wall mine his ground. After mining the landlord got all the ground back and if he wanted the pit turned into a lake the mining company would do it or the mining company would fill the pit back in for him. Didn't sound like a bad deal to me, but thats for coal mining rights. Don't deal too much with gas or oil rights around here.

 

[john250]

Lammie, if you decide that selling meets your objectives you might move ahead before Dec 31. Mr O has promised to raise the capital gains tax and it seems a good bet that will happen. Wait till 2009, and you could be giving a larger chunk of your "wealth" to the IRS.

 

[Lammie]

If we are going to do it, it will be before the new year. I already counted on that.

Thanks, everyone. Hub is seeing a lawyer today to see what's out there. It will be an interesting decision to make. I can see both sides of the coin. Whether to be free and clear or have "mailbox" income. Interesting choice.

 

[Earl Thigpen]

What are leases running in Texas? I recently started another thread on this subject. The lease we had been offered then - $250 an acre - fell through but since then I have been contacted by a couple other companies. We are in South Central Texas.

Depends. If you're in an area where the Barnett formation is located you could receive several $1000/net mineral acre.
If you're not in the Barnett it could range anywhere from $150 to $500 for the first year and a $100 or so for the next two years (three year lease). Royalty could be somewhere between 15% to 30% and even that depends on how you are pooled.

I have a buddy who is a land man and the company he was representing just pulled out of an area in S. Texas because of a smart a$$ attorney who wanted to line his pockets more than helping the clients. So the answer is a big depends.

 

[peg4x4]

What happened here--Some folks sold mineral rights during the oil boom--then the mineral rights came to include lignite,so they were moved off their place,and the land stripmined--Don't believe me? Look up stripmines in Bastrop county.........

 

[Lammie]

What happened here--Some folks sold mineral rights during the oil boom--then the mineral rights came to include lignite,so they were moved off their place,and the land stripmined--Don't believe me? Look up stripmines in Bastrop county.........

Peg, I don't expect to stay in this area for much longer. Maybe move if Steve gets transferred, or at least when William finished HS in four more years. I was looking to move up to Oklahoma. We both have family up there.

Like I said, this requires an attorney.

 

[peg4x4]

Yeah,but---------Now "THEY" have turned that lignite mine into a "watermine"and are selling off our ground water,claming it's a byproduct :???:

 

[TexasBred]

What are leases running in Texas? I recently started another thread on this subject. The lease we had been offered then - $250 an acre - fell through but since then I have been contacted by a couple other companies. We are in South Central Texas.

O&G companies are cutting some of their upfront expenses by lowering bonus payments. Those still active are still paying good royalty rates which is where the long term money is. I good friend had 60 acres unleased and gas company offered them $2,250 bonus per acre plus 23% royalty. Same company called last week and offered them a flat $10,000 bonus for the entire 60 acres with same royalty rate. Several companies in the DFW area I understand have done the same and some have completely dropped all offers.

 

[TexasBred]

What happened here--Some folks sold mineral rights during the oil boom--then the mineral rights came to include lignite,so they were moved off their place,and the land stripmined--Don't believe me? Look up stripmines in Bastrop county.........

Lignite IS NOT included under the broad term "oil gas and other minerals"...nor is iron ore. If someone wants to specifically reserve or convey these they must be individually listed over and above the broader term "oil, gas and other minerals".

 

[backhoeboogie]

Several companies in the DFW area I understand have done the same and some have completely dropped all offers.

You can still get the big offers if you have land adjacent to a big hit. Just be prepared to sign confidentiality clauses and keep your mouth shut!