Very, Very Very New

I have an opportunity to purchase 73 acres in Delaware county, New York  and I need some help.  All of the mineral rights convey with the property.  I would like to know if anyone could give me an estimated value of the mineral rights.  I have no intention of living on the land, just lease for drilling.  I would like to know if it is worth my while to purchase.

Thank you

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Permalink Reply by Ragnars Repo on November 6, 2013 at 6:12pm
Mark, New York is not frac friendly. Try to get in touch with David Perotto, look under the members drop down and friend request him. He seems to have a good pulse on the industry in New York. Good luck.
Permalink Reply by David Perotto on November 6, 2013 at 6:42pm

Hey thanks for the vote of confidence. Well NY is still up in the air. The home rule court cases should be decided by June (see www.jlcny.org for more info on that). That it is a critically important decision. If the judges allow home rule to trump state law, the oil and gas companies will be very reluctant to pursue a NY lease, and who could blame them. Then we have Uncle Andy, another wild card. Basically it boils down to a high risk high return type investment.

Minerals are currently devalued in NY, if it all works out you will see a big return with the Marcellus in Delaware County. Most bigger land masses  are selling for 2,000-2,500 in your area (including the mineral rights). In the southern tier I see 1,500-1,800. I have listed a parcel for $1,200 per acre in Allegany County, but I am keeping the rights. With that example, the minerals are only selling for about  $500 per acre , devalued for sure. They could return zero $$ or 10,000-20,000 per acre over the life a natural gas well.

 

Permalink Reply by Mark Capwell on November 7, 2013 at 4:25am

Hello David.  Thank you for that most useful information.  I will be watching the courts for a decision.

Permalink Reply by Gary Kline on November 11, 2013 at 7:51pm

In southern Broome/Tioga Counties vacant land is more in the $4,000 - $5,000 range...but before the gas craze the same parcels were $500 - $1,000.   Go figure the mineral value~~~~

Permalink Reply by Mark Capwell on November 7, 2013 at 4:24am

Good Morning and thank you very much the information.  David has responded as well.

Permalink Reply by james on November 7, 2013 at 7:52am
How much are you paying per acre? There are still some decent deals you can get in the real estate market, I have seen some nice properties selling for $3000-$5000 per acre with full rights in western pa.
Permalink Reply by Mark Capwell on November 7, 2013 at 8:41am

James - Thank you for your response.  I will look into western PA.  I am a Pennsylvania native and would be most intersted in property there.  I do not live on Pennsylvania or New York State at the moment.  Regarding the New York property, the initial asking price is in the neighborhood of $2600.00 per acre.  No discussios have been made with the seller.  Given the information provided by David Perotto, I'll be watching the courts in NYS.

Permalink Reply by james on November 7, 2013 at 9:32am
I think you can find land that might cost slightly more per acre in western pa, but the chances of getting a gas lease are a lot greater. I have been checking out property in New York also, but if they continue to ban fracking then all you have is an expensive piece of hunting land. In nortern counties like Erie county and Crawford county where gas companies haven't really started doing any leasing you can buy some real nice property for $4000 per acre that includes mineral, gas, oil, and timber rights.
Permalink Reply by james on November 7, 2013 at 9:37am
I forgot to tell you that the further south you go, the more land with rights goes up. In Mercer county most land with rights is selling for $5000+ per acre, you get into butler/Lawrence county the prices go to $7000+ per acre, and you get into Washington county I have heard prices go for as high as $10000+ per acre.
Permalink Reply by Tim Tarr on November 7, 2013 at 1:24pm

James,

    That $10K/acre I would have thought very serious about selling 2 years ago. For oil and gas rights, I want to keep surface. I would not even think about it now.

    I'll bet you can still pick up some for 6k with surface but probably going to take allot of effort. There are still some uninformed people around but getting pretty thin.

   Estate sales would be best chance to find something. Getting timely Title work done may be difficult. I'll bet oil and gas company's have land-agents watching for something that "cheep". They could sever rights and re-sell surface, that would be alot "cheaper" than leasing and paying royalties. 

   Get a good Real Estate Agent if you're serious. Than again they are probably in that game too!

Permalink Reply by Golddigger on November 7, 2013 at 12:04pm

Mark,

Do not forget that Delaware County is in the Delaware River Basin and one of the last places that NY will ever allow fracking. Anything east of Broome County is a big gamble just to get mineral rights.

Permalink Reply by Gary Kline on November 11, 2013 at 7:48pm

Agreed .... DRB is another strike against buying land for mineral development in Delaware County.

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