Replies to This Discussion

Permalink Reply by John Cash on July 16, 2008 at 9:47

My attorney told me that one of his clients sold 1/2 of their already leased minerals for $10,000 an acre. Seems low to me, but it does give us a starting point.

John

Permalink Reply by John Cash on July 16, 2008 at 12:15

Yes, I do think is low, but I also realize that when someone gets $30,000 an acre for lease bonus, they are giving up usually 75% of the royalties and keeping 25%. In my case, I am selling 25% of the 20% that I own which amounts to only 5% of the total production. Not much of a percentage, but it could still be worth a lot.

Maybe I didn't make myself clear. I've already leased the property for a whopping $300 an acre over a year ago. The possibility of my getting the big bucks for the lease bonus are gone. Was I lied to?...yep. Do I feel cheated?...you bet. But I'm told there is nothing I can do about it now. But even now with what I've got it should be more than enough to insure a good retirement. I just want to make better choices now.

John

Permalink Reply by Skidmark on July 16, 2008 at 12:35

But the 75% and the 25% are different. The 75% has to bear all of the production costs, whereas your 25% piece is cost-free.

Permalink Reply by John Cash on July 16, 2008 at 12:54

If you can believe the chart at www.geology.com/royalty, it is worth a lot more than that.

John