How To Get Your Mineral Rights Appraised?
Why is it important to get your mineral and royalties appraised? When buying and selling real estate, an appraisal is always required and buying and selling minerals and royalties is no different. After all, they are also considered real estate.
The value of mineral rights is constantly changing due to fluctuating commodity prices and oil and gas production levels. Values of today may not be the same tomorrow. It is always good to know the most up-to-date fair market value for your mineral and royalty real estate before going through the process of buying or selling.
Selling Your Mineral Rights
Over the past 15 years, mineral and royalty interest values have skyrocketed as this asset class has become highly sought after by investors.
Today, the old adage of “never sell your minerals” has all but started fading into history as individuals, families, family trusts, corporations, etc. have noticed the value of these assets and how easy it has become to buy, sell, and trade.
It’s absolutely imperative to have an appraisal of your minerals or royalties done, especially if there could be a possibility of selling those interests.
Be prepared.
Know what your asset is worth.
How are minerals and royalties appraised?
Every Mineral & Royalty Appraisal is a comprehensive report developed by our Certified Petroleum Engineer and includes:
- A forecast of the future hydrocarbon production on your properties by taking in to account surrounding producing wells, any currently producing wells, and any future wells that are likely to be drilled on your properties based on the proper field spacing rules in which your properties are located
- A model of the current and future development, production, and price data in order to calculate the net present value of future royalty revenue
Your report will also include the top three most important values, including:
- A fair market, final dollar per mineral acre and per royalty acre valuation
- Minimum value parameters - the lowest value range worthy of acceptance
- Maximum value parameters - the highest value range one could ever expect
Your appraisal also takes into account:
- Current and potential future commodity prices (past if retrospective) for oil, gas, condensate, and natural gas liquids