My family and I own some minerals in in Southeast Borden County, Texas. Specifically, in Section 41, Block 25, H&TC RR Co. Survey, Borden Co. Tx. A company has made an offer to purchase the minerals from several of my relatives. It has one plugged well on it and one very marginal producing well. I am not interested in selling my portion, however, some of my family members are. I have not done much in that part of Texas in a few years. Can anyone opine as to what a fair ball-park purchase price per NMA might be?
Nothing but my opine here. I don’t know too much about the market in Eastern edge of Midland Basin, but I assume its similar to along the Northern edge in Borden/Dawson.
You’re on the edge of the proven productive area for the Wolfcamp. The wells immediately south of you are not great, but economic at these oil prices. The Surges and HighPeaks of the world have to go somewhere if this party keeps happening.
It’s kinda binary. Either somebody drills this up and its worth > $30k/NMA or it sits there and is worth basically nothing. So…I would say something >$8k/NMA to purchase. Somebody out there has to be an optimist. Shrug.
Thanks a bunch for the information. Your thoughts are kind of what I was thinking in my ballpark quick assessment. We were offered $3K per NMA. That sounded low.
Section 41 is only one mile away from an active rig and immediately north of a new producing well. It looks like they’re avoiding drilling through that field in Section 53 to the north so it’s possible the lateral length would be too short to draw immediate attention, but I agree with NMOilBoy and others that the value is probably $3,000-$5,000 per net royalty acre (NRA). To convert a $/NRA to net mineral acre (NMA), take whatever royalty rate your lease is for (for example, if it’s a 20% rate lease) and multiply by your lease percent then divide by 12.5.
Hello. We have been offered $1050 pnma 1/4 royalty on a three year lease. I believe the company is Highpeak Energy who is doing the actual drilling. Copperhead is the company doing the lease negotiations for Highpeak. We are countering with 3K pnma and see where that takes us.
The Area is the W/2 of Section 70, Block 20, Lavaca Navigation Survey, Borden County, Texas. I thought there was a well or two on this property, The Fluvannia wells. I may be mistaken from another parcel in Borden County. Stephens & Johnson operate the fluvannia wells but they are older wells that have played out for the most part.
Yup, what Clint said. Those two wells have spud. I have no idea what that means for you in terms of the appropriate bonus, but I’m guessing you have more than an acre or two so…well…royalty will dwarf bonus either way. I’d definitely lease as who knows if they will payout or be successful, but getting 25% of a breakeven well is still pretty nice.
Which also makes Sec 41 look more likely to get be in somebody’s current development plans. Keep pushing the limit to the East. Unless these two are total dusters or something.
