Do you own mineral rights? PayDayMinerals.com pays cash for mineral rights to land in oil and gas producing regions of the United States. We consider mineral purchases all over the USA but at this time, our focus is the Haynesville shale / Bossier shale play in East Texas and North Louisiana, the Eagle Ford shale of South Texas, the Granite Wash play in the Texas panhandle and Oklahoma, the Niobrara shale of Colorado, Wyoming, Nebraska and Kansas, and the Bakken shale of Montana and North Dakota.
We have bought thousands of acres of mineral rights and take pride in offering people congenial, courteous, professional service. It is a fact that some people are going to sell their mineral rights; owners have done so since the oil and gas business began over 100 years ago. We want people to know that a reliable, knowledgeable, ethical buyer such as our company can make a sale of mineral rights an enjoyable process. And we have found that those who sell mineral rights are very happy to get their cash!
Sometimes, in just a few months, it is apparent that our purchase of mineral rights was not a wise purchase. We win some, we lose some. Yes, sometimes, our gamble did not pay off and the mineral owner is overjoyed at his good fortune. And sometimes, our purchase pays off. In the long run, our entire portfolio, made up of the winners, along with the losers, will pay off or we will be out of business, simple as that. In the meantime, the sellers got their cash. We are very open with people about "we win some, we lose some."
So, why would anyone consider selling mineral rights?
First, without a doubt, holding on to mineral rights could bring in more money over the long run than selling. That is, IF everything goes well for that particular property. IF no bad wells are drilled in the vicinity of the property, IF the property is actually drilled, IF the property is developed in a timely manner, IF oil and gas prices don't fall, IF the oil/gas operator for the property doesn't do something foolish, etc.
However, depending on one's cash needs or desires and his/her aversion to risk, selling definitely mitigates risk, as there is no risk in cash money. With that said, here are some points to ponder.
- A bird in the hand is worth... a lot! Cash money is a sure thing. There is no guarantee that any one tract of land will have a well drilled on it. Plus, oil and gas exploration is a very risky business. Some wells that are drilled are "dry holes," meaning no oil or gas is found. And some that hit paydirt don't produce as well as planned for. And there are many instances of an operator fouling a well by its own completion operation techniques. Or, simply, things go wrong. If you sell, you have the sure thing -- cash money. By selling, you are selling risk to the purchaser.
- If one is up in age, reaping a cash windfall allows you to enjoy your asset while you are alive. You can't take it with you!
- Enjoying a cash payday can pay off debt or buy something you need or provide for your children's education.
- Perhaps you missed out on a big lease bonus in a shale play that paid big lease bonuses once it got going. Selling some mineral rights allows you to enjoy a big payday and get your part!
- A sale of mineral rights is considered capital gains, tax-wise, and the tax rate is only 15%. If you lease land, the income is taxed as regular income.
- Energy prices are volatile. (See Bloomberg for oil and gas prices.) In the fall of 2008, the biggest crash in the history of the oil & gas business occurred. It's just a risky business! And prices are also subject to political swings. If the government puts heavy burdens on the oil and gas industry, prices could fall further. Oil forecasters are rarely right. Some say it's going up, long-term. (See peak oil.) Some say prices, especially natural gas, will remain depressed for many years. There is no crystal ball. Thus, cash in hand, sure money from a sale of minerals, is appealing to some, as it minimizes risk.
- Alternative energy research has been kicked into overdrive by higher oil and gas prices experienced a few years ago. If a major research breakthrough occurs, oil and gas prices could fall and remain depressed. There have already been two major announcements -- wind energy and solar energy. Some say that one recent solar energy research breakthrough could provide a large scale solution to our dependence on oil and gas. Another big announcement of late was growing algae commercially to produce oil. Alternative energy developments are unproven at this time but suffice to say, research is in high gear.
- Global uncertainty. Many people's worldview is just not very optimistic. Any number of scenarios could create chaos in the global economy. So, again, cash is king.
Why do we buy mineral rights? We are in the risk business. As stated, in the long run, if our evaluations are good, we will make a profit IF oil and gas prices do not crash from what they were when we made our evaluation. But for any given transaction, we sometimes lose it all. We speculate, hoping that an oil or gas well will be drilled on or near that property someday... that it finds oil or gas in commercial quantities... and, again hoping that oil and gas prices do not crash.
It's a risky business. Look at the history of oil and gas! Sometimes we do well with a property. But, risk is very real. We spread our risk across thousands of acres. As for the Haynesville / Bossier shale, Eagle Ford shale, Niobrara shale, Granite Wash shale, Bakken shale or various other shale plays, there is no guarantee that an oil or gas well will be drilled on any given tract in our lifetimes. Once it's drilled, even if it hits, there is no guarantee that production will be good. And once production is established, sometimes, things go wrong with the well and it has to be plugged. And sometimes, it just depletes faster than anticipated. Mother Nature does not give up her treasures easily. So, by taking the cash, you're selling away the risk.
And, more important for those with mineral rights in the active shale plays, the money we can pay for mineral rights is substantial. We have never been able to pay such high prices. When a play is hot, a lot of capital is thrown at the area. We have very deep pockets behind us and we are happy to spend their money! Their pockets are so deep, losing it all would not detract from their quality of life. However, a landowner missing out on a sure-thing small fortune can be devastating. And, as mentioned, it's happened a lot.
If you are interested in a cash payday, here's what you can do.
- Sell all of your mineral rights.
- Sell 3/4ths of you mineral rights.
- Sell 1/2 or less of your minerals.
Thus, if you don't want to sell all, you can sell a portion to enjoy the cash payday and gamble with the part you reserve, hoping that it turns out good. It's your choice.
To inquire about selling mineral rights under your land, call us or fill out the form.
(Ask for Bill)
We also have more info at another site about selling mineral rights in the Haynesville shale play
And another... how to sell minerals in the Haynesville shale play
Increased use of natural gas is a good thing... natural gas alliance