Antero is offering me $1,500.00 per acre with a 15% royalty. Is this the going rate?
Steve,
I can only speak on my own behalf, but I received an offer on Sunday for 5,000.00 / NMA and a 20% royalty. There are numerous factors to consider, but it is my personal opinion, that the offer you received is low for the current market.
Cheers,
WJ
Thanks for the info.
How much per acre depends on what percentage of a tract you own. The greater percentage and the greater the size of that tract then the more you can command.
Right now the market is taking a beating and many drill sites are going idle so the price may be down.
3 1/2 years ago I signed $2500 per acre at 16% for 1/2 ownership in a 50 acre tract (not with Antero but another company).
Another piece of advice I got was that it can't hurt to ask for more. What's another $500 to this company versus to you? Just throw it out there and see what they say, all they can do is counter with the same offer.
Good luck!
That is not the going rate. I haven't seen an Antero lease in Tyler County for a couple months, but I have seen them in Wetzel County this month and their starting offer is $3500/acre on small net mineral acreages.
However, I had heard from a landman that Antero wasn't taking leases in Tyler County as of the first of the year. Just seeing that you'd been offered in Tyler makes me happy. Maybe Antero fired that landman's broker.
Jim Neff's advice is excellent. Always, always ask for more. When I make a counter-offer for my clients it's always for a couple thousand more than I think I can get. In Tyler, I think I would ask for $6500/acre or so. I would also ask for 20% and see what they said. Don't forget to do some more research and get other terms of the lease modified, removed, and added.
In the most recent Antero Overview (February), I noticed that there is not much activity in Tyler County. Does anyone know the reason for that? A lot of activity in Doddridge County though.
I'll speculate. I think Antero has bought up most everything they want to in Tyler, except for some small lingering interests (tied up in heirships for the most part) they need to finish up units they've already planned. They have limited personnel, and have decided that Wetzel County has more unleased property with good potential than Tyler does at this point. So they've moved lease buyers from Tyler to Wetzel. That's my somewhat experienced and slightly educated guess.
Thank you Kyle! I've been working on a lease for 3 years that is tied up in heirship; will see what happens.
You've been negotiating a lease with someone for three years? Man, that's a long time.
Kyle,
I can only speak for my own experience, but when a company shuffles landmen every six weeks, you start all over again and it usually takes the new landman 4 - 8 weeks to start the process over again.
Yeah, I know. I worked as a landman for four years and have been working as an attorney representing mineral and surface owners for the last four or five. I am working on one negotiation where my client has most of the minerals and all of the surface, and that's turning into a rather lengthy negotiation as the company doesn't want to be specific about what surface they expect to use. The rest have usually been a matter of months, with the exception of some who were negotiating with EQT and neither side would budge on their stance on post-production costs. Three years still seems like an awfully long time.
My 3 years was not just negotiating time but other issues. We've had 4 landmen, heirship issues and other unexplainable delays.
'Tis the season. Seems like every time we get back in touch with a landman they've been fired and someone new is on the project. Of course, if it's CNX/Noble in Jane Lew they only have one guy left in the office to do what 20(?) were doing last year. I know they had at least a dozen this time last year and I think more. Makes it pretty hard to keep up with everything for that one guy. I have at least three clients who we were working on leases for who now have nobody to talk to. It's more than a little frustrating. In a year or so when things start to pick up again we'll get back at it, though.