Does anyone know how much my 20 acres of oil land is worth? (mineral rights)

[cool57one]

I would like some advice on how much to sell my 20 acres for in New Mexico, Eddy County, the Oil company that leases it wants to buy it. I see people sell the land and retain the royalties. It seems the land prices have quite a large range of value. If anyone knows about this subject I'd like to know how much to accept & not get ripped off.

[easyjett]

Contact a Real Estate Broker for the value of the land and maybe some insight on the royalties. If you feel you have a "gold mine" contact a Real Estate Attorney to discuss all your options.

[rruff]

I wouldn't bother talking to a realtor, unless you have one you know is knowledgeable about this and you can trust them.

[Sarahsez]

I wouldn't trust a realtor in Eddy County.

[joe--h]

Why would the oil company want the land if you retain the mineral rights? Joe H

[jaxart]

Originally Posted by joe--h

Why would the oil company want the land if you retain the mineral rights? Joe H

It's done all the time - seller retains the mineral rights and buyer owns the land. I presume an energy company would feel that at least they don't have to deal with two separate entities if they decide to explore the tract. Tracking down heirs can be a time consuming and daunting task if the land has been owned by a "family" of the original owner for more than a generation or two - speaking from personal experience. And tracking heirs of both the land and mineral rights doubles the land agent's task (and income!).

[cool57one]

The land has been in my family for over 100 years, there is only 4 people involved. I'm sure they would like a well on there, in the early 80's the company wanted to drill , my Uncle held out for $10.00 a gallon, the offer was $7.00. He wouldn't budge, so the oter 3 lost out. Now the heirs are more reasonable. I have read an acre is worth 2k - 20k, each acre could possibly hold an oil pool under it worth 20 million. So the value ranges from one end of the spectrum to the other. Monday I'll try to find an oil land seller, similar to a real estate agent. Must be some in New Mexico, but of course out of the county.

[mtlogger]

Originally Posted by cool57one

The land has been in my family for over 100 years, there is only 4 people involved. I'm sure they would like a well on there, in the early 80's the company wanted to drill , my Uncle held out for $10.00 a gallon, the offer was $7.00. He wouldn't budge, so the oter 3 lost out. Now the heirs are more reasonable. I have read an acre is worth 2k - 20k, each acre could possibly hold an oil pool under it worth 20 million. So the value ranges from one end of the spectrum to the other. Monday I'll try to find an oil land seller, similar to a real estate agent. Must be some in New Mexico, but of course out of the county.

I worked in the oil patch for many years. The real question is do you own the mineral rights? If not the drillers don't need your land or your permission - they can directionally drill underneath it and not pay a red cent.

Wells that produce less than 50 bbls/week are hardly worth the effort of drilling costs. $7/gal - no one gets that! It's a percentage usually 2% sometimes as high as 7%.

If you don't have the property tax bill - go to the assessors office to see what the land is worth. They will probably have a list of oil companies that abut the property line.

[domino]

Originally Posted by cool57one

I would like some advice on how much to sell my 20 acres for in New Mexico, Eddy County, the Oil company that leases it wants to buy it. I see people sell the land and retain the royalties. It seems the land prices have quite a large range of value. If anyone knows about this subject I'd like to know how much to accept & not get ripped off.

Your mineral rights are worth what the oil company will pay. The oil companies try to stay anonymous by going through a broker, because they don't want any competition from other oil companies driving up the prices of mineral rights. They want to pay the least they can get away with and avoid a bidding war with another oil company. Shop it around if you think you can get more.

[cool57one]

I own the mineral rights. So far I see an acre is worth 2k - 20,000 per acre depending.. I know mine will not be on the high side !