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Permalink Reply by Joe C. on January 3, 2020 at 6:44am

Jim, 

  It's tough to give you any pricing on oil and gas minerals as there is so many scenario's to buying mineral rights. For ex Is the acreage leased?  if so, is it a bad or clean lease?, is the lease pooled and unitized? You will have to give us a little more detail on the acreage.

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Permalink Reply by James Rowland Milleson on January 3, 2020 at 7:43am

EXCELLENT-Let's explore this.  (1)  unleased acreage 1st...        (2)leased acreage at 12.5%net royalty.   (3) unitization of 640 acres  (4) not pooled as of yet.

jim

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Permalink Reply by Joe C. on January 3, 2020 at 8:39am

Jim, your best bet is to put a mineral acreage packet together listing all properties, unleased and leased, companies who have the leased acreage and units, areas including twp and county, tax map parcel numbers and maps. Find the top 5 mineral companies and shop it around. The 12.5 % net is OK but not great. Make sure you state if any leases have a better shut in, terms, pugh, depths, special warranty etc... This will give the buyers a better idea and a faster approach to selling it faster. Due to the slow down and activate in the industry, buyers will look this. If the company is say, Gulfport who has the units, it maybe worth more than if it is a company that filed bankruptcy or stopped all activity for the purpose of selling their assets. I am working with a gentleman right now who has around 300 acres in a few different counties of Ohio with leased, unleased and producing acreage. We put together a mineral packet and shopped it to 6 different companies, he has had offers from $800k to 1.2 million. The companies will fight for it. 

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Permalink Reply by Frank J Moll on January 3, 2020 at 7:06am

decent written lease in Harrison county at 18% royalty with well permitted but not yet drilled is going for roughly $7,500 an acre. Like he said there are many variables but that gives you an idea

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Permalink Reply by Frank J Moll on January 3, 2020 at 8:30am

this is estimate based on leased land in a unit that is not yet producing.....

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Permalink Reply by Joe C. on January 3, 2020 at 9:07am

Frank, This is good, but the mineral buying companies or investors now are becoming more detailed in their search on buying.

For example, the 20% for $8000 an acre, need a little more detail on this now. If it is 20% with a post production cost, I doubt it will not go for that as we speak.. The reason for this, is after all your fees come out of that 20%, now you're only collecting 14% + - royalty. Same if the lease is a Marcellus only or all depths. Of course the Marcellus or Utica only is worth more. They look at Special warranty vs general warranty, pugh clause or no pugh clause, shut in increase, terms, who is the company, are they drilling, building units, bankrupt, selling assets and the areas. This is called their "points system". I have seen three major companies who are buying in the Appalachia area us this. The whole mineral buying system is changing. 

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