What is the average rate per mineral acre for leasing on Section 25 Reeves County Texas.
Ive heard 20-30k by many then was just told 3-5k. Any insight?
There are several different Section 25s in Reeves County. Your lease rate will depend on which block / area your minerals are in. Generally, 3-5k per acre is the lower range of lease bonuses in Reeves County. 20 - 30k per acre is the price for selling or buying minerals.
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We are block c-1.
So its 20-30k per mineral acre then they more than likely would pay at sign un?
We have 10.
Then monthly we’d receive royalties at about 25% if we agreed to that?
Still trying to understand the royalty and bonus process.
Thank you!
Using your numbers: $3-5K/acre is likely for leasing at 25% royalty. $20-30K/acre for selling minerals that are leased at 25% $20-30k/acre PLUS $3-5K/acre for selling unleased minerals
25% royalty means you would get 25% of the revenue associated with your 10 acres on a monthly basis via check or direct deposit. Make sure the royalty is entirely “cost free!”
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You lost me when you began speaking about if it was 20-30k per mineral acre.
When you say cost free you’re speaking in regards to the maintenance fees im reading about that they charge?
The thread title is about leasing, yet you keep wanting the $20,000 - $30,000 acre which is for selling your mineral rights.
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Do you want to take a bit of risk and want to lease for $5,000 or so an acre with a 25% royalty?
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Do you want the sure thing and want to sell your mineral rights for $30,000 or so an acre?
#1 is fuzzy on how much you will eventually receive, but there is upside potential to make more than #2.
#2 gets you a defined amount of money upfront, but you have surrendered the possibility to make more than the $30,000 acre.
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This article is dated 2013, but it might help you better understand the importance of having true “cost free” royalty language in one’s lease which has been approved by one’s own oil and gas attorney. Be aware that even though the lease language may contain the words “cost free” it can still functionally allow for post-production deductions.
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This thread about leasing is one ive created. I am or wasnt clear on if the 20-30 or the 3-5 was accurate for leasing. Which is why I asked.
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Oh!! Okay. I understand now. Thank you so much!
fwiw, we leased about 10 miles east of C1 Sec 25 in Mar 2019 for a bit over $7k/nma. with quite a bit of haggling. 25% royalty.
if you sold your unleased acreage you would, I would guess…get more than $30k/nma. lease is worth about $7k/nma and leased minerals worth about $28k/nma ($14k/nra). So that is $35k/nma.
In the end, it sounds like you have some small portion of 10 acres. Money is money, but there is no Beverly Hillbillies situation here. Ask PRI for a bigger bonus until they tell you to get bent. Sign said lease. Get your money out of suspense. Hope they drill more wells. Or just sell it all and not have to worry about having to deal with it again.
If you are bored I don’t mind running through the math.
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Thank you so much for taking the time to try to help me understand this all. Ive always sucked in math and then add on Ive never even heard of mineral interest so this as you can imagine is a foreign language! I am feeling like by the time it all trickles down and percentages are split a bazillion times I probably will not get much. This was inherited from a family member pretty far back. He had 1/9 interest in 10 mineral acres in a section with 659 acres. PRI said they’re only interested in 320 ares of that 659.
That family member died and passed to his three kids. Im learning they had 1/3 a piece from his 1/9. On of those 1/3 of 1/9 went to my Great Grandfather. Then it was passed to his two kids. So the 1/3 0f 1/9 was divided by 2 now. My Grandma received the 1/2 of the 1/3 of the 1/9. She died. She had two kids. My Dad and my Aunt. So they got 1/2 of the 1/2 of the 1/3 of the 1/9.
My Dad died. He has three kids. Myself and my two siblings.
So by now our percentage is pathetic! lol 
I dont even know what it would be! It hurts my brain.
Remember …if you sell…you NO longer have any mineral rights. You will receive what you get for selling and no more ever.
Bumping this up - how’s it looking this Summer ('20) for the going rates in Reeves?