I’ve been lurking on here for a few days, trying to learn what I can. Got an offer from TexPLM, for over 10 grand per net acre, for an inheritance my Brother and I received years ago. This is the first monetary offer I’ve seen over the years, and seems a little high from what I’ve read so far for just 2.17 net acres? It is the Marquez Survey, A-12. Anything I should know? Any info would be appreciated…keep in mind, I’m still in the “Mineral rights for Dummies” stage, lol !
Welcome @elkmtngear . Here’s a low cost or no cost tip or two for newbies:
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100% free: review their website presence. today’s website is yesterday’s business card. Are there specifics? people and their backgrounds? place of business? professional presence? employees or a bunch of contractors. length of time in business. If an outfit can’t put together a substantial website, they’re probably pretty thin otherwise
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look at any number of sites that offer online real property records of the county in question. research their name as the Grantee (buyer). See if they’ve actually bought minerals there in the last year or two… how many transactions?? review the deeds… look for bad language (county-wide granting clauses, general warranty language… stuff like that = bad for sellers)
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request/demand to see the paperwork up front, prior to committing to ANYTHING. P&S Agreement, form of deed.
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review the language surrounding title issues… this often comes into play
Just comments from an experienced citizen layman… Only after vetting whether the paperwork and paper flow are descent would I ever get to the point of talking price
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Good advice, I’ll check out TexPlm for sure. The person left messages on my phone, and was eventually able to talk with my Wife. She shot out a Conveyance offer by express mail, which states we can verify funding before we return the Original Deed. Sounds legit, but, I’ll certainly give it due diligence.
Thank You.
Never sign a deed without the MONEY right then. Let them run the title at their expense and if you are sure that they are going to pay you for your true total interest and you know the amount then you may be OK. Get the money right then when you sign. Beware!
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Not sure what you mean by this? Was this something that was received in the mail, signed, and returned? Hmmm…
Those words “conveyance” and “offer” are really goofy when presented together.
My bad…“Conveyance Document” was the terms they used. Nothing has been signed as far as I know, I certainly wouldn’t seal the deal, without investigating wells/activity near the acreage, and without proof of payment.
Thank You, been reading some of your posts, and this is something I definitely paid attention to!
Elkmtngear, I, too, received an offer to purchase my Leon County minerals recently, which I also thought was way above what its value should be. I own more than you, but not a great deal. They are in the M C Lee Survey, A-500. These guys were really persistent, and upped their offer 3 times. I didn’t take it, and wasn’t ever going to.
What I’m still confused about is this: he said he was valuing my acreage on net royalty acres, which he said is a ‘multiple’ of my net mineral acres. I still don’t really know which ‘multiple’ is chosen, and is it more arbitrary, or industry standard. Good luck.
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Seems like if they were legit, and they kept upping their offer, they had to have some kind of inside information about your situation, right? They wouldn’t purchase without intent to make a significant profit. Had you received royalties from the acreage before?
Of course, they think the long-term prospects for the region are very strong. These minerals have a 40 year old well on it, that is almost totally non-producing. I personally have not received much, but my mother did. It’s a shallow well, and from what I understand, this regions is being drilled almost exclusively very deep, for gas.
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I didn’t really doubt that they were legit, I just didn’t pursue it.
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Makes sense. That’s the kind of info I need for my specific acreage, there are a large number of wells on the abstract, just need to know what is active, and within the (royalties) border of that parcel. Hope yours pays off very well, down the line.
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Net Royalty Acre (NRA) is an industry standard term. 1 Net Mineral Acre (NMA) unburdened leased at 25% equals 2 NRA. 1 NMA unburdened leased at 22.5% equals 1.8 NRA. 1 NMA unburdened leased at 20% equals 1.6 NRA. 1 NMA unburdened leased at 3/16ths equals 1.5 NRA. 1 NMA unburdened leased at 1/8th equals 1 NRA.
If an offer to buy is not based on NRA that probably means the buyer doesn’t know what you actually own. Your deal could get adjusted down during due diligence when they run title and find out how many NRA you actually own. Ultimately, buyers pay based on a NRA-equivalent calculation when it’s all said and done.
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From what little I know about selling minerals is that the oil people know that they are going to drill a new well and they will make 10 times that once the well is drilled, regardless it’s up to you ! I do know that when handsville shell , I offered $16,000, per acre for a 40 acre tract! The man was not interested in the money, well they drilled and he became very rich! I would drive around and look for wells and sure enough it was next to his 40 acres , at least that was how I was in the old days when I was a scout for a oil company! Personally they don’t make minerals anymore and technically has come a long way since then! So I only sell if I need the money just get ready for the irs to be your new friend! Good luck
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Thank you Ranch77 for the explanation–it is appreciated!
If it’s worth buying, then it’s worth leasing or keeping!
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Jimmy, I always wanted to give some money away. If I ever get it than the IRS will not get all of it.
There is a permitted location on the RR Commission map, right on the Property Line. Other than that, there are just dry holes, and a few gas wells on Neighboring Properties (Including a horizontal well on the neighbor’s property). Looks like someone that had mineral interests in the original undivided 65 acre parcel that my Great Grandparents reserved in 1931, leased to Surprise Valley in 2022, then sold everything to 3P Petroleum in 2023. My Uncle just died last week, leaving 2 acres of mineral interests to my Cousin Sean. My Brother and I are going to get together with him, and decide how to proceed. I appreciate all the input here, Thank You.
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Thank you Jimmy, but no loss as yet. Just not capable of functioning. That is a loss in a way. So thanks for you concern.
I have been getting offers from Enfield Minerals and Horizon Mineral Acquisition Group. I have 11 net acres in Thomas Collingham and Eddy Sparks. Their offer has gone from 50,000 to 160,000 for everything. Has anyone heard of these companies or what’s going on?
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