selling unleased utica shale acerage. how to determan price?

I am thinking about selling 33.20 acers of land in the utica shale, the maps show it in the wet gas aera. no leases or leans on the land, no buildings. just open land. I have read all the reasons you should not sell, but it dosn't apply to everyone. i have concidered taxes, and age and I think selling is the way to go for me.

the problem I am haveing is arriveing at a price, after reading all the calulations of how to come to a asking price, it is a bit confusing,

can someone stear me to a web site that would tell me what land like this is selling for, or give me a way to calculate a price pr acer?

 

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Permalink Reply by Billy Park Whyde on June 22, 2012 at 4:12pm

  It depends upon where the land is located, the wet gas area on maps is like a treasure map, the treasure may be there but where exactly? It could be lease locked in other words surrounded by land that perhaps CHK might tie up for years.

  For what its worth Google search for land for sale in eastern Ohio and try to match location as close as possible to see what the prices are with mineral rights!

Permalink Reply by Donald on June 24, 2012 at 3:48am

Thanks Billy, respect your knoledge and advice. I know the question don't have a quick eazy answer. this is a new game, and is still evolveing. i don't belive the realtors really have a handel on it yet.

Permalink Reply by JR on June 23, 2012 at 2:55am

A guy on here awhile back ran a a classified ad in the Oklahoma City paper for $15,000/acre in Guernsey Co and claimed he had 5 calls within 2 days asking for legal descriptions.  His property was leased, but about to expire as I recall. I never did see if he sold.  I'm in the same boat, and my gut tells me looking local could be a disservice.  Going to where the knowledgeable investors are (TX, OKC, etc) or in O&G trade publications might be a more valuable ROI.  Haven't tried it yet, but seriously considering.

Permalink Reply by Donald on June 24, 2012 at 3:29am

Thank you for your input, I have been thinking along the same lines. I don't think the local listings and sales are a good indicator of the true value. have not listed or advetrised mine yet, I need to do more research and get  input. thanks much for yours.

Permalink Reply by JR on June 24, 2012 at 3:37am
The title of the guys post was"would you sell for $15,000/acre?" if you can find it, you could try and message him to see how things turned out. My research at the OKC paper showed it costs about $500 for a one-week classified ad.
Permalink Reply by Kathleen on June 23, 2012 at 3:07am
Some of the auction houses have auctioned land than minerals so they may have a better feel for what the real price may be. Ask them if they are marketing the minerals to investors or to areas that know the worth. I would think they would be since they want as much as they can get for the sale. The real price IMO might change up or down after another round of production reports. I think late aug 2011 CHK released some than in the spring 2012 but as of right now the info isn't really out there yet.
Good luck. I personally won't take less than 10 grand an acre but I don't know where you are.
Permalink Reply by Kenny on June 23, 2012 at 11:53am

Most buyers are only willing to pay at a 36 month payout (if it is leased).  That means that they won't pay more than what they can recoup after 3 years of royalty checks.  With your land being unleased, it is hard to say.  Really, it just comes down to what you can get someone to pay for it.

Permalink Reply by Mickgyver on June 24, 2012 at 4:21am

Hello Donald

this will be an interesting subject since they are still determining the actual wet gas area , these seismic testing trucks will offer up results to help the companies, but we will be behind the times for quite a while since they wont release this information to us landowners so they can keep the prices down ,

Then there is the situation of the man that created the last set of maps that listed the changes of the various types of areas ,wet gas dry gas, lean and rich condensate ,in which he even warned people to not take them as the gospel .

For some reason it is unclear but after 29 years of service with the ODNR he was let go . He did state that the maps may be wrong as it was just his best guesstimate according to old core sample results as to where the play lays out in the various counties .

it does appear that some landmen did use this map to their advantage in securing land leases ,especially since the places that looked like dry gas only would allow them to offer less money on a per acre basis in the various "dry gas areas".

It may be to your advantage to hold off a while until actual production begins near your area when the pipelines are more usable . but this could work both ways as well .

the sad thing for many people is even when you talk yourself into making a decision of selling or leasing you are still at the mercy of the companies that are able to back out of the deals at any time they want .

For most landowners the groups have been the best deals for everyone as far as getting good information about what is going on as well as getting the clout needed to be able to get a good lease with a nice bonus and royalty .

If you lease your land you may have some input decisions as to what is allowed to happen on the property ,but most lease have the clause that permission will not be unreasonably with held .If you sell the minerals outright you will have no control of anything that goes on forever .

Sometimes as you said a person has to try to do what is best in their specific situation as waiting too long could affect the entire outcome of the opportunity you may end up being offered at a later date .

Please keep us posted on any solid information you may acquire of what to do as far as the option for an in hand dollar amount ,versus waiting to draw out the royalties if and when they do happen in your particular area .

best of luck with your decision .Mick

Jim ShoosPermalink Reply by Jim Shoos on June 24, 2012 at 4:59am

Mick... seismic results will not disclose anything other than the existence of Shale and if there are any faults present... it is not capable of discerning what the hydrocarbon make up of the shale is. 

Permalink Reply by Mickgyver on June 24, 2012 at 7:53am

Hello Jim

yes I did'nt make myself clear I ran the post together.sorry for that mistake

I just meant it would show if there is any potential or not ,and if it would be better to lease before the fact is known if there is any potential or not , if they rule the area out ,then they may not lease at all 

Also I meant to add even though the well production information helps to show the various areas of wet and dry gas this can be held for a year as I was told before it has to be released to the public .

when I spoke to the men doing the testing near Barnesville he specifically said they are just testing for gas only which I did not fully understand , can you elaborate on that answer

Jim ShoosPermalink Reply by Jim Shoos on June 24, 2012 at 8:03am

Mick,

If you consulted with guys that are actually on the ground drilling shot holes, laying out the geophones or acquiring seismic permits then chances are that they probably aren't completely informed as to what the seismic results are expected to generate.  Seismic won't discern oil from gas in a shale (unless somebody has come up with something brand spanking new in terms of seismic). 

Permalink Reply by Mickgyver on June 24, 2012 at 9:24am

Hello Jim

 I asked him if they were doing seismic testing first and he said yes they are .

At the time I had not seen all the wires just the big truck that looked like a series of cabs from the pans they use in surface dirt work then I saw the large cups against the ground

I then said are you testing the entire area for gas and oil potential .

He responded no just gas .

I said not oil and gas potential , he said no only gas .

After I got home I looked into this and the following site shows that seismic testing is used for earthquake potential and natural gas reserves.

that site indicates they can test for gas only ,but many articles look as if it is just for the potential areas that meet the normal condition's that indicate good potential for hydrocarbons

it is hard to keep up with the ever changing technology

here is the link ,

http://www.wisegeek.com/what-is-seismic-testing.htm

I then came home and looked up information on the equipment type and I found it was the vibration testing type machine according to the pictures .

then the boxes were geophone's that pick up the vibration signals and transmit back to a main frame computer for further refining of the details

this particular test ran at least 10 miles maybe as much as 14  where the wires stopped

They must be fairly certain of the quality of our area with this testing .

it is strange that they do not even state what is going on just one lane traffic ahead signs were along the road .

Have a good day Mick

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