Hi all, just wondering if anyone would know what an expected payout would be for 30 acres in WV. I own .050505 (mineral acres I believe), so what would the expected payment be when it starts drilling. They are expected to drill in the next 3-6 months. I have receieve a couple offers to sell mine. They are offering from 120 to 230k per acre, so with my share that is very dwindled down. The rate is 16% for the payout. If you could help, thanks!
You may have better luck getting answer if you give the location. Just like topside real estate, mineral rights are location dependent so just asking about all of WV is not helpful. Remember that you are not dealing with just the one well, but perhaps infill wells down the road. The buyer wants to make a profit off of your acreage.
Are you sure the offer is 120-230k an acre? Thats an out of this world offer, there’s no way a company could make money or break even at those prices.
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The very rough rule of thumb for royalty payments is that you’ll get $500 per net mineral acre per month once all the wells in the unit are producing. It’s not much when you have a small net like you do, maybe $5/acre/month? I’m not sure what the 120 to 230k per acre number could be. Bonus payments in WV vary considerably depending on the county, but if drilling is going on you should be able to get at least $2,500/acre. Try to push them up to 18% on the royalty, and be sure to get gross proceeds so they can’t take out any post-production costs or taxes.
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