Held By Production ...options?

Question.........

We are already tied up and not able to do a lease with a new company because we are/have been with a company for years which makes us 'held by production'.

My question is this...a man stopped by offering to purchase our mineral rights at 2500.00 an acre. He also mentioned that we can include however many acres we want, that we wouldn't have to do all of our land.

This is the first time that we have been approached about selling our actual mineral rights since we are held by production. Is this something that everyone else is now being asked and is everyone also being offered 2500.00 an acre or  ???

I would appreciate any information on this.

Thank you.....

We are in Guernsey County, Spencer township.

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Replies to This Discussion

Permalink Reply by george m. on October 31, 2012 at 7:32am
By signing away your mineral rights, you are limiting your upside (2500). By not signing, you have tremendous upside potential sometime in the future. Think about it, the guys offering you 2500 per acre are not doing that out of the goodness of their heart. They expect to make Huge profits on their investment. One more thing...Ohio could change its HBP statue at any time to stipulate that HBP only applies to a given geological formation as defined by the drilling permit on the original well. What's the geology in your area? Are there producing Utica wells yet? Remember 12.5% on a Utica well could be 1000 times more that 12.5% on a shallow gas well.
Permalink Reply by Dawn Blake on October 31, 2012 at 8:53am

We understand all of that. We are also considering my parents, who are 67 and 68 years old. They are in good health, but they also wonder...should we sell mineral rights so that they can have some money now...who knows how long it will take for things to happen otherwise and that is a decision that they are struggling with. Younger people can wait it out, I imagine the older ones are really wondering what to do. These companies know what is going on and possibly when, they should really educate all these landowners of their plans and time frames if possible.   At least give landowners a ballpark idea.......hearing nothing is frustrating to many.

Permalink Reply by Oliver Perry on October 31, 2012 at 9:13am

If your parents really need the money now, maybe they should sell a portion.  On the other hand if they don't really need the money, they should wait. Even if they were to both die while waiting, their children or heirs will still reap the benefits of the mineral rights. And chances are, they will be worth considerably more than $2500 an acre in the future. It all depends on your parent's current financial situation. 

Permalink Reply by Philip Brutz on October 31, 2012 at 9:51am

I would shop around for a better offer.  I was just offered $4,000 an acre for my gas rights in Millwood twp.

Permalink Reply by Dawn Blake on October 31, 2012 at 9:58am

Thank you Phillip for sharing that information !!

Permalink Reply by jonathan M. on October 31, 2012 at 10:44am
Philip,

I was offered $3800/acre by a company called wind rush. What company is offering 4k?

Thanks
Permalink Reply by Dawn Blake on October 31, 2012 at 11:13am

Jonathan,  which county are you in ?

Permalink Reply by Dee A on October 31, 2012 at 1:26pm

Just adding my 2 cents to make sure everyone here is clear on the differences between leasing your O&G rights and selling them. Selling is forever and you'll never get any royalties.

Permalink Reply by Dawn Blake on October 31, 2012 at 2:08pm

Yes ... I am aware. I hope everyone is.   :)

Permalink Reply by jonathan M. on November 1, 2012 at 8:49am
Guernsey
Permalink Reply by Philip Brutz on November 1, 2012 at 12:03am

Sorry, I did not keep the offer.

Permalink Reply by JD on October 31, 2012 at 2:28pm

we were offered $5000 per acre in Guernsey County ... through Southeast Ohio Landowners Assoc.

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