High offers to buy minerals

I have been hearing of companys offering $12000, $13000 even $15000/ acre to buy mineral rights. So far I haven't been able to find out who is making these offers. If you've received an offer in this range could you please tell me who made it? Thanks.

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Permalink Reply by Dan Warner on January 19, 2015 at 4:11pm

Thank you very kindly for the information, Ms. Miller.

Considering the flak on this topic, I can imagine it must have taken some measure of courage to post.

You make a clear and valid point.

After toiling for most of one's life, it is hard for some of us to face the type of battles regarding leasing that we hear and read about.

While some are concerned with their heirs, and rightly so, you and I are in similar positions.  I do have children, but they are strong and healthy, and will be fine.  What I have tried to give them in raising them will be of more value to them than any amount of easy money could ever be.

I too am involved with helping my mother in her golden years.  She has already been cheated by leasing agents, and is now being harangued by more.  She doesn't understand the complexities of this industry, and needs to be free of the aggravation.  

Don't kick yourself too hard; it still may come back around.  

Best of luck.  

Permalink Reply by David Allen Lilly on January 20, 2015 at 12:19am

So, you have children but would sell their inheritance for some pittance of personal gain ?

C'mon.

To each his own I guess.

We will establish a trust for the kids and grandkids, and any other worthy cause we see fit to give our money to.

Permalink Reply by Dan Warner on January 20, 2015 at 2:48am

Mr. Lilly,

I appreciate your passion on this subject; I truly do.  It's that passion that supports the boom or bust nature of O&G.  Maybe you or your heirs will be rich; maybe you already are.   

Nevertheless, I find it unseemly having you go so far up my ... business. 

As I have stated, my concern here is primarily for my mother.  She has all the money she needs to live comfortably for the remainder of her life.  I can't get her to enjoy what she already has.  We are not a greedy family. 

It is worth mentioning that, being one of her children, it is my future riches that you accuse me of playing fast and loose with.  My mother has been cheated and harassed to a point that she never should have been.  She is disabled and reclusive, but more independent than most folks half her age.   She pays extra for an unlisted phone number, and keeps her location as discrete as possible, yet they seek her out.  The landman who burned her didn't even call ahead, just showed up at her door, unannounced.

My point here, and I should thank you and Mr. Ed for helping illustrate it so well, is that the mineral buyers do not hold the patent for bad behavior.  It should be clear to you by now that I am weighing options based on fact, a concept that seems to elude you and your compadre  completely. 

… and I think you both know the old quote regarding opinions.

The main goal is to get them to go away, so that she can live in relative peace.

In that same spirit, I offer you the last words.

Please make it interesting.

Permalink Reply by David Allen Lilly on January 21, 2015 at 1:19am

I find your comments concerning your children and your Mother to be absolutely impossible to believe, in that you raised them well enough to give away 90% of their royalty inheritance.

Perhaps illogical as well.

Permalink Reply by Finnbear on January 21, 2015 at 2:42am

As long as there is the potential for money to be made on the mineral interest that belongs to your mother, the landmen WILL continue to seek her out. The ownership of land and the minerals that accompanies it is public record. This is the reason our county courthouses have been so clogged up for the past 3-5 years. You can't hide from these people, it is their job to try to find you (the landowner/mineral owner) and convince you to accept the offers their employers have set forth. At times, their "convincing" borders on harassment. I have seen it firsthand. I've encountered some absolute lying snakes and also some good people who are just trying to earn a living like the rest of us. The recent lower prices for a barrel of oil should at least temporarily work in your mother's favor as it will depress the market for the mineral buyers and keep them at bay until the price of oil goes up again or the next "hot" play is discovered and the leasing & mineral buying activity moves there.

Permalink Reply by Dan Warner on January 21, 2015 at 5:09am

Thank you for the civics lesson.

The gist of the conversation is whether to sell or lease.

My contention is that if she survives the initial contemptible behavior of either type of agent, what is it worth for her to then take on a protracted battle with the O&G's, lining an attorney's pockets along the way, only to lose half of what she fought for?  If it shortens her life by one day, or even reduces the quality of what she has left, was it worth it?  The cult-like no-sell lobby hereabouts seem to put a higher value on the young and able than they do the ones who literally gave them the life that they (mis?)lead.  Perhaps they have Eskimo in their genetic make-up, but my heritage is more like the Native American, who believes that his elders are worth something.

As to the lower prices, that has only worked in their favor, in that they are using it in their attempts at discouraging negotiation.

This is not a fad.  The gas is still down there, and they still want it.

As proof, the leasing agent finally got around to calling me, per her request.

To date, there have been three distinct agents contact her regarding two parcels.  This is the first to honor her request to contact me.

That, to me, represents a clear breach of the "borderline" you spoke of.

While it may not represent a criminal act, it is certainly a violation of privacy.

I understand the brokerage business model.  Outsourcing is the order of the day.  An agent license is not a license to harass someone or disrespect their preferences.  While some may be weakened by it, it has a potential to even be counter-productive.

Permalink Reply by Finnbear on January 21, 2015 at 9:47am

Right now, selling or leasing is going to bring far less than it would have a few months back before oil prices tanked. You've lived without the money from it thus far, is there a dire need for some cash right now? If not, I'd wait for higher oil prices which will equate to higher lease bonuses and higher mineral interest prices. Only you can assess your current situation and determine if you must have some amount of money immediately. I know that in my area of Belmont county, lease prices have dropped by about 50% since last fall. Lease or sell, you'll be doing it at fire-sale prices right now.

Permalink Reply by Werner Kostendt on January 19, 2015 at 5:05pm

Thank you Annie.  I am assuming that offer was for the leased, but not drilled, oil and gas only and excludes minerals like coal, limestone, etc. and excluding the surface.  And also I  wanted to confirm that you meant to say December 2014... that is just last month.   Have things changed that much in just a few weeks?  Wouldn't the $15K offer, or maybe something a little lower, still stand?  Or did you mean December 2013 or sometime earlier?

 

Permalink Reply by Jarrad Stephens on January 19, 2015 at 6:13pm

15k-20k a month for a leased property is not a bad offer I think. Anyone that has that kind of an offer I would take it.  If it was 50 acres that would be 750k that I could mess around with elsewhere. I think it would be beneficial for my family and last for quite sometime, Private message me with your 15k-20k offer. I would honestly be surprised if I get a response.

Permalink Reply by David Perotto on January 19, 2015 at 11:45pm
15-20 total, one time payment. Nobody is getting 15-20K per month , per acre on royalties.
Permalink Reply by Dan Warner on January 20, 2015 at 6:11am

Given the gist of the conversation, I believe Mr. Stephens misspoke.

I think he meant a per acre selling price, not per month royalty payments, as is borne out by the total.

As for me, don't bother with PM's; put it here for public consumption.

Permalink Reply by David Allen Lilly on January 20, 2015 at 12:02am

I know a guy in Millwood township Ohio who asked for $20,000 an acre and was turned down, about 10 months ago.

I would not even consider selling my royalties for that, depending on where you are that is a pittance to what the life of your lease will pay out.

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