It has come to my attention that some oil and gas companies have been soliciting landowners making an offer to buy your mineral rights. If any person has been contacted or has done business with a company of this nature please contact me or post to this discussion. Again, this is regarding selling your mineral rights to a company, not leasing. Thank you for your time and interest in this matter. 

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that's a good point know it seems to me that when someone's surface rights are separate from the subsurface rights that the two still need to work together and even know of each other.   I think the contracts should state that there be communication of assignments and names/addresses given.

cause if there is natural gas rights and the drilling team is on the surface...shouldn't the surface owner have some sayso about where the road goes or if trees are taken down and they have timber rights then who gets paid and is it ok to just make a trail anywhere?   I think these are important issues.

I had a company send me a letter saying that they wanted to discuss purchasing my "royalties".  They offered $1,000 an acre and thought they were offering me the world.  I told them that I wanted my attorney to look over the papers they became very rude and condesending.  I received a copy of the agreement they wanted to me to sign (I posted it on this web site) and it is does not appear to be a royalty purchase but a Mineral Rights purchase.  I looked in to selling my mineral rights and found that if I sold them, I could NEVER get them back according to the contract.  It was a forever and always thing, it even states that my beneficiaries could never get them back from them.  I told him NO DEAL and he became extremely irritated.  I would however sell my royalties if the number offered were right.

1000 an acre is nothing. They were going to resell them.
Here is a free easy to use royalty payment calculator for oil and gas. You put in the size of a wells total acerage, put in the number of acres you will have in that unit, put in your royalty percentage, put in the oil production or gas production and bingo there is the answer. See that is the calculator. The calculator is assuming though you have family a 100% of that royalty of what ever your agreed totality is.
The Harrison County Ohio well brought in by Chesapeake would give you some production figures (a but that well if true is a monster) I would try going with say
1,000 bbl/ day with a gas production of say 2,000,000 cft/ day. Take you answers divide it by your average and it would give you a idea. Remember to multiply out your results for a per month then year amounts. WELL PRODUCTION DECLINES OVER TIME! So you might want to run some calculations of say production decline of say 75% over say 20 years of production. Hope this helps.

Decline curves are 65% in year one and 90% by the end of year two.  That is the model used by one of the majors (not CHK).  

I was reading that the decline rates are not as high as expected

Jack,   Have you read at this discussion...thought it might help.   I haven't read it entirely but from I can see that they do outline how they arrived at their appraisal of what the royalty is worth for sale.  and recent.  Of course it does matter what state, what area, etc.

As I told my dad when he was going to sell his house the value of your house is what some one will pay for it? 

If you're thinking about selling mineral rights, you might want to watch Split Estate -

If I was going to sell the mineral rights, I would sell all of the realestate....If they screw up, you get sewed too as the landowner.....Frankly, I'd take the money and run from the entire property, not just the mineral rights, if the price was to my liking.


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