Would You Sell Your Land & Minerals? And If So How Much Would You Take?

My husband and I were approached by an invester to sell our land with the OGM rights. We are thinking about selling our land that is located in the WET UTICA region and has great geology. We would like to get the opionion of other land owners out there. If you were approached would you sell? And if you would sell what would the price per acre be?  Half of our acerage is leased and the other hald on a seperate parcel is not leased. It seems like if we do the math of the royalties over 30 years there is allot of money coming in. So do we sell? And If so what do we ask per acre? Thank You & God Bless =)

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Hi Patricia,

On dry gas property, probably $10,000. On wet gas $15,000. Up front money with no royalty. Just my two cents (pun intended).

I would be happy with $4000.00 a acre on dry gas here in pa

Hi-
We have also been approached to sell mineral rights on some of our land. It is 25 acres in Marshall Co., WV. In Dec. 2011, we were offered $2500 per acre, but turned it down. Last wek another company offered $3000 per acre. From reading this site I assume thse were both low offers. It's tempting ("Bird in the hand..."), but then we think of what it might bring us later. Denver

I wouldn't sell for 50k. After you sell where do you put the money? T bills are losing about 2% a year after inflation 

that's using govt numbers. I think it's more like 5%+.

After you sell that's all you'll get. If they find another Pay Zone Buyer will get that pay day!

Now if you are 70+ and want to move to Florida that's a different story.

I thought it was surface and all mineral rights. Not just royalties.

If a fair offer was given and the person selling makes a decent living they would avoid the almost 40% loss of royalties to taxes. From this stand point alone I see an up side to selling.

we have had the same though that you just had. Why lose 40%+ 0f the royalties to taxs. And the price we are looking for an opinion on is selling both top land and mineral land together. I havent seen $50,000 per acre yet but we have seen $25,000-$30,000 per acre pricing.

And you have doubtless noted that the "Long Term Capital Gains Tax" rate could potentially double from 15% to 30% next January - depending upon politics.

http://online.wsj.com/article/SB10001424052702303753904577452674278...

 

JS

Patricia, did they want your leased or unleased acreage?  We are leased but appear to be in theliquids rich/oil window--prime location. We also would sell. I'd sell the whole thing for $25-$30k per acre. Unleased you would think could be a bit more...$35k? I figure years of royalties, additional formations below. It is valuable.

From the depletion curves I've seen, 80% of revenue comes in years 1&2 with the other 20% coming over the next 28 years...This is actually a good thing given the time value of money.  The most important thing you need to know is the discount rate being used to get the net present value of the revenue stream:  10% is fair, anything higher is robbery.  You're going to need some production numbers from the area, could be tough to come by.

Then throw in a dollar amount for the surface.  My guess is your older and need cash now.  The buyers are hoping they can dazzle you with a number per acre without you asking how they determined it.  Some assumptions will need to be made as in all finance.  But in the end, you have to look at your own personal situation of age and cash flow needs.

A friend of mine just sold his 60 acres and home near Dellroy, Ohio in Carroll County. He sold the mineral rights also at the same Kiko Auction. He kept 25% of the mineral rights per acre for himself, 25% with the property, and 50% per acre at the auction. He got $2500.00 per acre for the 50% of the mineral rights, and I do not know what he got for the actual land itself. So that makes it $5000.00 per acre ACTUALLY paid just for the mineral rights. It does not matter what someone thinks it is worth, it is what the market will pay. Good Luck $$$$$$

No............no lease as of yet.

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