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Unread 2016-02-23, 10:05 PM   #1
bonecrusher
 
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Default has anybody purchased/sold oil & gas royalties or mineral rights

Basically as the title states, has anybody here owned oil/gas and or mineral rights.

If so where did you buy royalties for oil/gas and how much? Looking obviously for producing wells, not closed or stopped wells.

thanks in advance!
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Unread 2016-03-13, 06:18 PM   #2
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Unread 2016-03-14, 08:25 AM   #3
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I have had some clients do it. To me I dont see the point unless your going to drop some serious coin to make it worth wild. I have a few clients that get 5-10 1099's for 300 bucks each. Granted, I dont know what they paid for them, but for 200 a year then take 30-50 in taxes out and having to file extra state returns the ROI vs the hassle factor cannot be that much.

Now on the other hand I had one client that ended up with 150kish in royalty income every year but it was from 3 1099's which seems like it would be worth it, but once again I dont know what they had invested to get that.
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Unread 2016-03-14, 12:49 PM   #4
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any idea where they purchased them?
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Unread 2016-03-15, 08:13 AM   #5
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A little confused buy your question.

A good friend (who owns a decent amount of land in Western Kansas) was approached about this a few years ago. The short of it was that he was asked to sign away the rights should it or when it produced. The company would drill on their dime. If the company finds anything, they set up shop, and my friend would collect a royalty when it is producing. If the company does not find anything, they leave. He opted not to do it. Some land a ways off produced, but the further away it got, it was hit and miss. They don't leave your land in the best condition upon leaving either, so he didn't want to mess with it.

So in that case, the company that owned the rights, would be paying the royalty to the land owner. It sounds like you want both in your original post.

I don't recall the amount of the royalty being offered. The kicker was that they could start and stop the well whenever they wanted. If prices drop to a certain level, he could have been left with messed up land and no income from it.
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Unread 2016-03-16, 09:23 PM   #6
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Quote:
Originally Posted by 69Mach351 View Post
A little confused buy your question.

A good friend (who owns a decent amount of land in Western Kansas) was approached about this a few years ago. The short of it was that he was asked to sign away the rights should it or when it produced. The company would drill on their dime. If the company finds anything, they set up shop, and my friend would collect a royalty when it is producing. If the company does not find anything, they leave. He opted not to do it. Some land a ways off produced, but the further away it got, it was hit and miss. They don't leave your land in the best condition upon leaving either, so he didn't want to mess with it.

So in that case, the company that owned the rights, would be paying the royalty to the land owner. It sounds like you want both in your original post.

I don't recall the amount of the royalty being offered. The kicker was that they could start and stop the well whenever they wanted. If prices drop to a certain level, he could have been left with messed up land and no income from it.

he could sell his interest in the royalty I would think? I don't have any land or anything.
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