We have been offered 1000 per acre ( Block C8 Section 25) 25 percent royalty.
161 gross acres - 40 acres mineral rights @25%
The land appears to be 8 or so miles south west of the City of Pecos.
The landman stated this was "top dollar" and they are after the wolf bone play.
Is this a fair offer? It appears to be... but we have no clue.
What are to odds of this tract of land actually producing? greater than 50%?
Any guesses as to what might the average production might be IF they hit something?
Thanks in advance for any help.
We have property south of yours, I believe (my section maps don't go far enough north to see your C8 Sec 25 but judging from how the numbering system is running, and your '8 miles south west of Pecos" comments, that's where I think you are.
Offers in our area, further south of you by a couple miles have been running $650 to $1000 per acre this spring. I believe that 25% royalty is pretty good - 20% to 25% is what I've been seeing recently. No expert here but your offer seems fair, and "top dollar".
"Wolf Bone" refers to two geologic strata, the Wolfcamp and the Bone Springs, which you can find on geologic survey maps of this area. Part of the Delaware Basin, which is the oldest and deepest part of the Permian Basin. The strata look like they might contain gas or oil pockets but it is very deep, at least 10,000 feet.
Again, I'm no expert but that's what I've been reading.
This area is pretty active right now. A little tough finding hotel rooms in Pecos, lots of new shiny pickups, etc.
Hope it plays out for you (and for all of us).
Thanks - I hope it plays all for all of us also.
I spoke to my landman today - he stated that all CWE drilling would most likely cease if oil hits $70 or below. Lets all hope it stays around 80..keeping my fingers crossed..