So yeah yall know I live in the boom city of west Texas. Little did I know we own 75% of our mineral rights. Well behold you guessed it, a Landman has contacted my wife, several times.

It was low ball as heck at first. They offered 500 per acre, and 13% royalties. Well we are at the end and now they are offering $10,000.00 per acre and offering a check for $1,326.00, plus 25 percent in royalties. So I spoke with my buddy (he is in oil and gas) and he says per acre is going for about 15 Gs in our area right now. Hmmmmmmmmmmmmmmm

So I countered with $15,000 per acre and 25 percent of royalties. Nope still offering 10 Gs and 25 percent royalties. Here is the kicker. He will buy our mineral rights for 20Gs (yes 20,000 thousand) and cut us a check right now. No royalties etc of course.

Man that's a tough one. THF brain trust, what gives? Help me out please. FYI we live in a residential neighborhood not in the country and it is of course less than an acre.

Anyone??

Take the 20

Is this the lot your house is built on?

Ok, but why? Not saying your wrong but is there a reason I am missing??

yes sir Mike

Think I'd opt for $15K and royalties, if you're sitting on or near a deep deposit, the long-term royalties will likely outlive $20K, one-time payment

Never sell your minerals unless you’re in a extreme need for cash.

Ok, but he is not offering 15k, he is offering 10k, a check for $1,326.00 and 25 percent in royalties. Or the 20 Gs lump sum. FYI I pray to God we leave Midland within the next 10 yrs for retirement purposes.

Never mind my first question. You will end up splitting the royalties with a ton of people if they make a well. Sounds like what they did here in Big Spring, drilled a horizontal going north to south. I just went ahead and sold them my minerals since there was over 760 people for that area. Even if it made a hell of a well it wouldn't pay much and even if it did it wouldn't last long, horizontals play out pretty fast.

^^^^^^^^this

ok interesting thank you Mike

He is offering $20k for your house lot? That's what...1/4 of an acre? So he's offering $80k per acre.

Take that [censored] and run.

So you aren't being offered $10K because you don't have an acre of land. You are being offered $1300 and 25% royalties OR $20K and no royalties. On that small amount of land, Id take the $20K. They cant drill on your property because its covered with your house right?

I would ask how many acres are in the pool. If it is 640 or 704 then there will be more than one well. They did this in South Texas in the Eagleford and it depends on the well spacings as to how many wells they can drill in that pool. You would share in your part off all the wells drilled in that pool. Albeit small how much you can get depends on how many wells and how well they produce long term. Wells in Karnes County were producing 1000 to 2500 bbls of oil per day when the well were brought in. Little mailbox money for a long time for those folks. Wells are still going 8-9 yrs down here after they were drilled. They do taper off but when the level off they still do well. It will be more than one well. You will pay a lot of taxes on the lump sum depending on your tax bracket. You will get small checks for a long time...beer money.

You think the long term is going to generate $160k in revenue per acre?

160k divided by 4 lots per acre = $40k x 25% royalties = $10k.

Like I said...take the $20k and count your blessings.

correct

They will go outside of town on land and drill under the town.

^^^^^^^^^^^this and be done with it.

I will put these numbers out there for production on oil only on the wells drilled under the small town of Karnes City in 6 units. There are about 27 wells drilled in those units to date and have space for more to be drilled in the future. Since they started drilling these wells back 6-7 yrs ago they have produced 7,456,928 bbls of oil only(did not add up gas totals) as of the end of Feb. 2019. Lot smaller town but still a lot of oil produced from under the city limits. What your long term mailbox money will be depends on how large the pooled acreage is and how many wells are drilled in each pooled unit. Oil prices will vary also over that long term.
Their lump sum offer is always going to be lower than what the long term projections will be for production.

If you take the 20 , how much does the tax man get?

I own goose egg mineral rights. But I would be inclined to believe like stx said, they want to buy them for 20k because they are worth more than that.

OK, misunderstood, take the 10K+1326 check and 25% royalties, surely all of these will at least get close to 20K if not exceed that...

20k and 10% for a counter offer.

just remember, we only have 11 yrs and 10 months left till the end of our planet, per aoc.

party like it is 2099!

all I can say is I have a very small % in eagleford shale in live oak county % is less than .5% out of a 25% my family kept when land was sold many years ago. I thought it was only good for maybe $10 per month LOL but have gotten some checks over $100k and average this year around 15k per month. It all depends on how many wells and how productive. do not sell your mineral rights ( no more being made)

DO NOT sell the rights.

They aren't offering you $20K because it's worth $20K, I can 100% promise you that. If they're offing you $20K, it's worth a hell of a lot more than that.