I’ve gotten some offers on my mineral interests that have a wide range, anywhere from $llK, $19K, and up to $26K per acre. My question is about these buyers, what do they expect to get in return for their investment? So when they payout say $20K per acre what do they think their return to be? 5%, 20%, %100? Do they follow some sort of formula for return or is it really a WAG? Just curious to what the expectation is, at this point I’m not selling. Jagged Peak is drilling 2 across my section in Ward county (section47, block 34) so we’ll see.
Wildcatting wells in the Permian and Delaware basins is, by nature, risky and those that employ the WAG (wild a…ed guess) usually come to a bad financial end. There’s a MOUNTAIN of subsurface data and mapping all over the Permian and Delaware basins…so guessing shouldn’t enter into the decision to drill in any specific area.
$19,000 to $36,000 per NMA in Ward county is now the average for offers. Good luck.
THanks to both of you for the answers! My question on WAG was really me being facetious (or a smart A…) about the whole thing! But I’ve really been curious about the expected return for theses investors. So again thanks for the help.
Louis
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I wouldn’t sell…just my opinion.
Some of the offers are way below market value. I would definitely speak with an expert or get proper representation. I was always told by my parents who were told by their parents and so on not ever to sell. But I totally understand the need to based on family wishes etc.
Good Luck! Cecile
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Don’t sell…wait.