Surprisingly high ORRI offer

[ZacharyHarris]

We received an offer of over 36K/nra for our ORRI in Sec 33, 26S, 30E. I believe the tract is currently operated by Devon/WPX and, if my numbers are right, production has been bringing in around thirty or forty dollars per nra per month over the last couple years. So the offer is at about 100 years worth of present-day income.

On the other hand, the outdated data I have from an appraisal several years back says the acreage in our portion of that section remains mostly undeveloped. But still…

Is there a realistic new drilling scenario in which someone has legitimate grounds to be willing to pay that much? Have recent wells around there been good? If the offer is legit, what do they know about upcoming prospects that I don’t know?

[Andrewl00]

If someone is offering that much, permits for hz wells have been filed.

[ZacharyHarris]

OK, like these ones, which were approved this past August and haven’t spudded yet: OCD Permitting - Wells (nm.gov)?

[NMoilboy]

There are two rigs drilling those permits as we speak.

That said, $36k/NRA is still pretty high.

[Mineral_Owner5]

There’s always a chance of drilling in other formations both shallow and deeper and “horizontal drilling & production”. Keep it, don’t sell.

[timmyd]

who is making the offer is the key and is it legit ? dont know how many royalty acres you own but we have sold part in the past you dont have to sell it all.