I know this is a bit off the subject, but I keep getting offers to lease land for a solar farm. They want to pay me each year about 65% of the value of the land plus a 2% yearly escalation clause for a 20 year lease.
Nobody is stupid enough to pay 65% of the value of a product each year (plus escalation) for a lease. There must be something I am missing. Does anyone know what it is?
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They've contacted me a couple of times and the numbers they've thrown out so far are no where near what i make off of well pads and pipelines. I think the number is somewhere around 700$/acre per year. I'll also add i don't think they know what they are doing because their area of interest (southern desoto ) floods from time to time.
I suspect that the offer price may indeed be 65% of the "value" of your land per acre for whatever use it is currently put to but the offer is not based on current use. It is based on the value of the land per acre to the solar investor. Your land is not the "product". The product will be the value of the electricity generated per acre by the plant. Although we (GHS members) are here for the Shale or for Oil/Gas/Mineral information in general, our community is wide and diverse and has value beyond it's original purpose. As with an O&G lease, the details of the property are critical to value. My suggestion is to make a list of projects using the link I will post below and then, knowing the parishes where those projects are located, join the corresponding parish groups and post discussions there to see if any other GHS members have gotten offers. I suspect that some have. When you post in a sub-group, every member of that group gets a email notice that the group page has a new discussion. Even a few responses may be helpful if you are interested in exploring a sale. Good luck.
https://www.nola.com/news/business/article_f56004fe-de71-11eb-b161-...
Thanks Skip. I have no plans to lease. Like OLDDOG2020 between timber, hunting leases, carbon credits, well pads and pipeline, the "land" portion is doing fine and the mineral portion is only getting better.
You're welcome. Land for solar development is a subject that is generating increasing hits on my internet alerts. Beyond the question of value for land owners, it appears to be a business opportunity for those in the "land" business. Dealing with lease terms and negotiating with land owners transfers nicely from O&G to solar.
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AboutAs exciting as this is, we know that we have a responsibility to do this thing correctly. After all, we want the farm to remain a place where the family can gather for another 80 years and beyond. This site was born out of these desires. Before we started this site, googling "shale' brought up little information. Certainly nothing that was useful as we negotiated a lease. Read More |
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