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 The Rooster on April 6, 2014 at 2:56am

yea, your probably right.

Permalink Reply by al raptoria on April 6, 2014 at 4:46am

Please check out the thread I started on Valuation Assessments as the discussion took a turn to "TAX Strategies!" OR just look up the member's pother posts: I so emphatically encourage you all to check out forum member Arthur P Jensen's posts and his websites to learn of a legitimate way to DEFER taxes and REDUCE taxes as long as you get his strategy set before leasing/selling. My own Legal Counsel and CPAs were stunned and after researching Jensen and his strategy were floored they hadn't thought of his approach on their own!  Due diligence rules!

Best to All. (I'm headed out of town today and won't be able to reply here for quite awhile. Everything I'd say to you has already been said on that thread and on any links within it.) Again, Best to You!

Permalink Reply by Kathleen on April 6, 2014 at 2:08pm
Bo,
I agree. New technologies are always coming into play, information we don't have is out there or being discovered all the time. What a lot of us have now to sell wasn't even a thought 5-8 yrs ago.
Why the high offers? I do not believe its just wealthy people trying to expand their portfolio. I think its been clear the O/G co's are buying rights and they are doing it for a reason.
I get people in certain situations need to sell, but if that need is not present at this time, I would hold off.
To sell is forever.
Permalink Reply by pat on June 18, 2014 at 6:11am

dont settle for anything less than 40,000 an acre. at 40,000 an acre they are still saving over 50% of what they would have to pay you in royalties. as long as you have a good lease.

Permalink Reply by bo boboski on June 18, 2014 at 7:27am

Pat; I was thinking more like $100,000. per acre, but your $40,000, would be more realistic.They plan on making lots of $$$ at $12,000.

Permalink Reply by evan on June 18, 2014 at 7:35am
I've had offers from a few companies with the highest being Vine. OKKI energy and siltstone are giving offers a little lower. This is something I was considering for the past year. But in the past few months I've learned ALOT about this business. There are so many hidden agendas with these companies. Do what you want but it is crazy to sell , and it's not just about them paying you enough , there's ways they can run you out of what you didn't sell and end up with 100% of your rights and with that comes surface rights whether you agree or not. Bad idea.
Permalink Reply by pat on June 18, 2014 at 7:56am

right now i think i would pull the trigger at 50-60,000 i  would have taken 40,000 before i found out that they are running a gathering line towards, me.but let me tell you 100,000 would be really nice. and they would still save money.

Permalink Reply by Ryan N Nyardy on June 18, 2014 at 10:23am
You're calculating earnings based off the fact that every single mineral acre will be developed, which is not realistic in the least. Now, if you could guarantee that your land was going to be drilled, and you were in a great spot for oil and wet gas, and you had a great lease, then you would still have to look at it through the eye of the investor, who is doing this TO MAKE MONEY. It's a gamble. It's a risk. Not everyone is going to be included in a unit. Not everyone's lands is worth $40,000/ac, and regardless of whether or not it's with that much, you'll never see companies PAYING that much. Selling your rights isn't the correct choice for everyone. It's for those who wish to cash in on their minerals now, and not take the risk of holding their unfulfilled lease in their hands five to seven years from now. For some, the money these companies are paying is a fair trade. For some it's not.
Permalink Reply by pat on June 18, 2014 at 10:41am

what you have to keep in mind a lot of these so called investors really work for the oil companies. they are out there trying to save the company money by buying up as much royalties they can.i only calculated the 40,000 for any one given acre.

Permalink Reply by evan on June 18, 2014 at 12:36pm

Pat your exactly right ,  nearly all of them no doubt in my mind. 

Permalink Reply by Dexter Green on June 18, 2014 at 1:44pm

How did you arrive at that number?  How many wells are in the hypothetical unit that you used to do your calculations?

Permalink Reply by Brad on June 19, 2014 at 6:53am

Pat,

If you have put a value on minerals at $50,000 per net mineral acre then I would definitely like to speak to you as soon as possible.  I have quite an extensive portfolio of minerals for sale.  All properties would be at well over a 60% discount based on your valuation.  Please inbox me for details.  

However, I suspect that you wouldn't buy at $20,000, yet you expect to sell at $50,000. Am I using faulty logic?

For example: If I believed my car was worth $50,000 and somebody offered me an identical car for $20,000 I would surely jump on that opportunity.  

I look forward to hearing from you Pat.

-Brad

 

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