Selling Mineral Rights for the Highest Price Possible
If you’re thinking about selling mineral rights or royalties, it is extremely important that you know how to get the highest possible price. We show you how here. We also answer questions about important topics like:
- How much are my mineral rights worth?
- How can I get the highest possible offer for my mineral rights and royalties?
- What are the most common mistakes made by mineral owners when selling their mineral rights?
You might also find our Mineral Rights Price Index interesting. Updated monthly, our Mineral Rights Price Index tracks the monthly price changes for mineral rights in West Texas and North Dakota, Wyoming, and Colorado based on hundreds of data points for actual transactions in these areas. It is the easiest way to know how the value of your mineral rights is changing over time.
Price Info is Scarce
If only there were a Zillow for mineral rights, where you could look up the value of your minerals! Unfortunately, no such service exists, as the sales prices for minerals are usually kept private and are not publicly disclosed.
Price Depends on Who You Ask
The value of your minerals equals the maximum amount that someone is willing to pay. Most mineral buyers use the same set of factors (such as oil prices, current production, geology, and prospects for future drilling) to estimate the value of your minerals. But even though mineral buyers use the same valuation factors, they often come to wildly different valuations because they use different assumptions. For instance, some buyers think oil is going to $30, while others think it is going to $100. You obviously want to sell to the $100 per barrel guy, because his offer will likely be a lot higher.
The Most Important Factor
The key to getting the most money for your mineral rights is to get as many potential buyers to evaluate your acreage as possible. If you asked 1,000 different buyers to value your minerals, you’d probably get 1,000 different answers. You only get one shot to sell, so why not give every active buyer an opportunity to make an offer?
The Buyer Pool is Huge
There are hundreds, and, in some areas, thousands of active mineral buyers who purchase minerals in the major oil- and gas-producing regions. Trying to find them all – or even a significant portion of them – is a full-time job and requires significant effort. If you only contact 10 or 20 buyers, how do you know that one of the hundreds of other active buyers wouldn’t have made an even higher offer?
How We Can Help You
The experts at Shale Marketplace have decades of oil and gas experience. We have data on hundreds of mineral rights transactions across the best areas in the United States. Even more importantly, we have a large database of active mineral buyers all across the country. We can advise you on the price at which similar properties in your area have sold.
But the best way of all to discover the true value of your minerals is to list them on Shale Marketplace and let our large buyer network tell you what they think your minerals are worth. If you’d like to discuss further, we will be happy to help you discover the value of your minerals.
What is the best way to maximize the price of your minerals?
Selling mineral rights is a lot like selling a house. When you sell your house, you are more likely to get a good offer if a lot of people see it. You will get an even better offer if you receive multiple bids from competing buyers.
This is true for mineral sales as well. The best way to maximize the value of your mineral rights is to ensure that your property is seen by the greatest number of potential buyers, and then to create competition among the buyers. By listing your property at Shale Marketplace, thousands of active mineral buyers will be able to view and compete with one another for a chance to purchase your minerals.
Hundreds of Active Buyers in the Permian
Depending on where your acreage is located, there may be hundreds of active buyers. If you don’t know where to look, you will likely fail to find many of them. But you won’t get the best possible offer unless you are able to reach many of them.
“Why Do the Offers I’ve Received Vary So Much?”
Many Types of Buyers
The chart on the right illustrates the different types of buyers that mineral owners will encounter, as well as the types of offers that these buyers usually make.
Finding the Needle in the Haystack
The problem for a mineral owner is that it is extremely difficult to find the very top buyer. In reality, there are hundreds, and in some cases thousands, of mineral buyers who actively buy minerals in your area. Unless you are able to find them all, they won’t have an opportunity to evaluate your acreage and make an offer. And the top buyer for one property is not always the top buyer for the next property. Just because a buyer was the highest bidder on one property does not mean that they will be the highest bidder on another property, even if it is nearby. To get the highest possible price, each sale requires a careful search.
How to Easily Find Highest-Paying End Buyers
Wouldn’t it be great if there was a way to quickly and easily find all of the highest-paying end buyers who actively buy minerals in your area (especially the “blue bar” buyer who values your acreage highest of all)?
There is – that is exactly what Shale Marketplace does. After listing on Shale Marketplace (it’s completely free to mineral owners), pre-screened, registered buyers evaluate your mineral rights and then compete with one another to pay you the highest possible price. Buyer competition between the highest-paying mineral buyers brings the highest prices of all.
#1 Mistake – Accepting an Offer Without Shopping Around
The single biggest mistake mineral owners make is accepting an offer without contacting enough potential buyers. It is extremely unlikely that the first offer you receive for your mineral rights will be the best possible offer. Because virtually every mineral buyer will calculate a different value for your minerals, there is a high probability that you are leaving money on the table if you don’t run a comprehensive search.
The Perils of Running Your Own Search
If you own minerals in a good area, you probably receive unsolicited letters offering to buy your minerals. You might think that, by negotiating with each of those letter-writers, you will receive a good offer. And you might. But how do you know that someone else, a buyer you didn’t talk to, wouldn’t have paid more?
Missing the Highest Offer – a Case Study
The chart on the right is based on the chart on the previous chart (above). It illustrates what often ends up happening when mineral owners solicit bids for their property on their own.
Money Left on the Table
The end result is that the mineral owner gets a very good price but still leaves a substantial amount of money on the table.
Real Life Example – Loving County, TX Mineral Owner
Recently, Greg, a mineral owner, decided to sell about 78 net mineral acres that he owned in Loving County, Texas. Over the course of two months, Greg spent many hours exchanging emails and calling a wide range of mineral buyers. Greg negotiated aggressively and, after a lot of hard work, was able to get an offer that seemed extremely attractive – $1,482,000.
Shale Marketplace Found a (Much) Higher Offer
Before signing up the deal, Greg contacted Shale Marketplace with his top offer in hand to see if we could do better. Shale Marketplace reached out to many mineral buyers with an interest in Loving County, Texas. In less than 30 days, Greg had signed a Purchase and Sale Agreement with a buyer found through Shale Marketplace for a purchase price of $2,028,000, more than half a million dollars greater than what Greg was able to find on his own.
“What Are Other Common Mistakes Mineral Owners Make?”
#2 Mistake – Selling to a Mineral Flipper
Escalating prices, combined with the lack of easily available pricing information, have made mineral flipping highly profitable for some. Mineral flippers purchase minerals from unsuspecting mineral owners and then almost immediately sell those same minerals to another buyer for a higher price and an instant profit. Their success has attracted many who primarily reach out to new targets by mail. Consequently, many of the companies sending letters and offering to buy your minerals do not actually intend to own your minerals for more than a couple of days. In fact, some of them don’t even have the money to complete the purchase when they sign up to buy your minerals.
How mineral flipping works
Mineral flippers usually start off by sending you letters offering to purchase your minerals. Like some letters from genuine end buyers, their letters usually talk about how they have lots of money to spend and how they frequently buy minerals in your general area to add to their “fund.” The flipping process works like this (all numbers for illustrative purposes only).
- Mineral Flipper knows that Company X is paying $12,000 per net mineral acre for minerals in the area where you own minerals.
- Mineral Flipper sends out hundreds, and possibly thousands, of letters offering $9,000 per net mineral acre.
- Some mineral owners who receive the letter decide to sell to Mineral Flipper for $9,000 per net mineral acre.
- As soon as your sale to Mineral Flipper has closed, Mineral Flipper immediately sells your minerals to Company X for $12,000. This nets Mineral Flipper an instant profit of $3,000 per acre – money that should have gone to you and not to Mineral Flipper.
As you can see, mineral flippers have one key piece of information that unsuspecting mineral owners do not. They know how much the “end buyers” for minerals, who truly do buy minerals and hold them for the long-term, will pay for your minerals, and they pay you less than that amount. This results in a profit for them … and a loss for you.
How to avoid mineral flippers
It is obvious that mineral owners are leaving a lot of money on the table when they unknowingly sell to mineral flippers, but how can a mineral owner cut out the mineral flipper “middleman” and instead sell straight to the “end buyer” who will pay the highest price for your minerals? The problem is that there is no way for you to know whether you are dealing with a flipper instead of an end buyer.
Until now. Let Shale Marketplace help you. Our market is made up of end buyers, rather than flippers. That means our buyers pay higher prices than flippers. If you’ve got an offer from a flipper, there is a near certainty that we can beat it because we can connect you directly with the end buyer. Contact us today – it is completely free to you, and you’ll never pay us a fee.
“How Can Shale Marketplace Help Me Get Higher Offers?”
What is Shale Marketplace, and why should I use it to sell my mineral rights?
Shale Marketplace is a competitive online marketplace where mineral buyers compete with one another to offer you the highest possible price for your mineral rights.
Shale Marketplace will maximize the value of your minerals and allow you to sell at the highest price. By selling through Shale Marketplace, you will very likely receive a better price than you could have gotten on your own.
Buyer Competition Drives Prices Higher
After your minerals are listed, we market your minerals to a large number of active mineral buyers. This causes buyers to compete against each other, and the competition is sometimes fierce. The end result is that mineral owners typically receive higher prices for their minerals than they could have obtained on their own.
Fair, Free, “No Pressure” Process
We also make the process of selling your oil and gas mineral and royalty interests simple, professional, transparent, fair, and free. And we also maintain a no pressure environment where the mineral owner is never obligated to sell and never pays any fees.
The decision to sell minerals is a big one for many mineral owners. It can be one of the largest financial transactions that a mineral owner makes. It can also be unsettling to negotiate a large financial transaction with a huge mineral buyer who seems to have information that you don’t. Let the experts at Shale Marketplace answer your questions and provide you with information so that you can make an informed decision about whether to buy or sell.
Contact us today for a free evaluation of your minerals.
“How Does Shale Marketplace Work?”
Step 1: List Your Minerals on Shale Marketplace (free)
After agreeing to list your property on Shale Marketplace for 30 days, we will create a password-protected listing for your property. This listing is 100% free to you, and we will make this process easy for you. Once the listing is created, your property will be seen by hundreds of pre-qualified, active mineral buyers in your area. These buyers will evaluate your property, and some will submit offers.
Step 2 – We Find the Highest Offer for Your Minerals.
Buyers compete to offer you the highest price for your minerals. Buyers know that they are competing with other buyers for your minerals. This competitive tension generates the best prices, which are usually higher than you could get on your own.
Step 3 – You Decide Whether You Want to Accept An Offer.
We will present you with the best offers, and then you decide whether you want to accept, reject or make a counter-offer. We understand that just because you receive offers for your minerals doesn’t mean that you will want to accept one of them.
That’s why there is never an obligation to sell. Our job is to present you with the best offers from our large pool of buyers. Then you choose whether or not to sell. We pride ourselves on a no-pressure approach that puts mineral owners in control. We don’t like high-pressure sales tactics, and so we will never push you to sell.
Completely Free to Mineral Owners
There is never a fee to accept an offer and sell your minerals. The entire process is 100% free to mineral owners. Shale Marketplace enters into various fee arrangements with buyers, in which they pay Shale Marketplace a fee for access to our listings or for facilitating their acquisition of properties.
“How Much Does it Cost to Use Shale Marketplace?”
How much does it cost to list my mineral rights with Shale Marketplace?
Listing your minerals or royalties with us is 100% completely free. Sellers pay absolutely nothing to list their minerals or royalties. Regardless of whether you ultimately decide to sell, you will never pay any fees to Shale Marketplace. Our service is entirely free to sellers.
How much does it cost if I decide to accept an offer made by a buyer through Shale Marketplace?
Selling your minerals or royalties is also 100% completely free to sellers. Mineral owners will never pay any fees to Shale Marketplace.
If there are no fees to mineral owners, then how does Shale Marketplace make money?
Shale Marketplace enters into various fee arrangements with buyers, in which they pay Shale Marketplace a fee for access to our listings or for facilitating their acquisition of properties.
Other Questions About Selling on Shale Marketplace
Can you describe the selling process from start to finish?
The typical sales process is as follows:
- Shale Marketplace lists your property and actively markets it to mineral buyers.
- Shale Marketplace answers any questions that you have and presents you with offers as they come in.
- You decide whether to accept an offer from a buyer. If you do, you and the buyer will sign a Purchase and Sale Agreement that describes the key terms of your agreement (e.g., the property being purchased and the price being paid).
- The buyer then performs “title diligence.” Title diligence is the process of confirming that you own the property being sold by reviewing real property records filed in the county courthouse. This process usually takes about 30 days, and all costs associated with title diligence are borne by the buyer. There is no cost to you.
Once the buyer has finished with title diligence, you will execute a deed and send it to Shale Marketplace. The buyer will then send the purchase price to you through a wire transfer (or a certified bank check if you prefer). Once you’ve confirmed that you’ve received the purchase price, Shale Marketplace will send the deed to the buyer and the transaction will be closed.
What information do you need to list my minerals or royalties?
If your minerals are producing, then all we will need initially is a copy of some recent check stubs. If your minerals are not yet producing, we would request a copy of any deeds or other documentation showing how you acquired the property. It is also helpful to see copies of any other documentation you have relating to the property, including a copy of any Oil and Gas Leases, Division Orders, or title documentation.
But don’t be concerned if you don’t have all of these items! We are happy to walk you through the process and search public filings to help gather the required information. Contact us today to get started.
Am I obligated to sell if I list through Shale Marketplace?
Absolutely not! Our job is to inform you and to present you with offers from our large pool of buyers. You can then choose whether or not to sell. We pride ourselves on a no-pressure approach that puts mineral owners in control.
If I decide to sell, how long does it take to receive payment?
You’ll usually receive payment about 30 days after you sign an agreement to sell your minerals, though this can vary from deal to deal. During this 30-day period, the buyer will perform title diligence (meaning the buyer will confirm that you own the property being sold by reviewing real property records filed in the county courthouse). After title diligence is complete, the buyer will send payment directly to you.
Why shouldn’t I just sell my minerals on my own?
There is a good chance that, at some point, you’ve received an unsolicited letter offering to purchase your minerals. Depending on where your minerals are located, you might even receive several letters per week. Say you’ve received 10 letters from 10 different buyers. Are there any drawbacks to contacting all 10 and selling for the highest price? Since there are hundreds of qualified buyers who actively purchase minerals, you are unlikely to get the best price for your minerals from a pool of 10 or even 20 buyers.
That’s where Shale Marketplace comes in. We’ve got a large pool of pre-screened, qualified buyers, and these buyers compete against one another to offer the highest possible price for your minerals. The end result is that mineral owners almost always receive higher prices for their minerals through Shale Marketplace than they could have obtained on their own.
What if I already have an offer?
Many mineral owners already have an offer for their minerals and want to know whether it is a fair price. If this describes you, we highly recommend that you list with Shale Marketplace because it is a “win-win” situation for you. We will show your property to our large pool of qualified mineral buyers. If one of them is willing to pay a higher price than your current offer, you get more money for your minerals. And if none of our buyers can beat the price that you have on the table, then you can rest assured that the offer you have in hand reflects the highest price you could get for your minerals.
But what if your current offer has an approaching deadline after which it will expire? One of the reasons buyers put tight deadlines on offers is to keep you from searching for even better offers from other buyers. Don’t let an artificial “offer deadline” from your current offer pressure you into selling. Shale Marketplace is regularly able to find buyers who beat offers on the table, sometimes by large amounts.
If I don’t like any of the offers, do I have to sell?
Absolutely not. We will never pressure you to sell. We pride ourselves on a no-pressure approach that puts mineral owners in control with no obligations whatsoever.
We will present you with offers from our large pool of buyers and provide any information that you request. You can then choose whether or not to sell, and you will never owe us any fees ever, no matter what. And we will use our experience from facilitating recent sales to advise you on whether or not an offer is fair relative to other recent transactions we’ve seen.
How long does it take to get an offer?
Most listings receive an offer within 2 weeks of listing (and sometimes only 1 week). For larger listings or listings spanning multiple properties, it usually takes buyers longer to evaluate and so offers are typically slower. For small properties in great areas, offers usually come in more quickly.
How long am I required to list my property on Shale Marketplace?
We require that sellers list their property for a minimum of 30 days, as it usually takes a couple of weeks after buyers to evaluate your property and submit offers. After the 30 day period is over, you are free to have your listing removed with no obligation and no fees to Shale Marketplace. By agreeing to list your property for a minimum of 30 days, buyers are more likely to spend time seriously evaluating your property and making you an offer. But you are always free to have your property removed after 30 days with no obligations whatsoever.
Who can see my information on Shale Marketplace?
We take data security very seriously. Only pre-screened, qualified buyers with the financial wherewithal and requisite mineral buying experience will be able to view your property. We are also able to redact sensitive information upon request.
Helpful Resources for Mineral Owners
- Mineral Rights Price Index – Track Monthly Changes in the Value of Mineral Rights
- Mineral Owner’s Guide – How to Sell Your Mineral Rights for the Highest Price Possible
- “How Much Are My Minerals Worth?”
- How to Find the Highest Offer for Your Minerals and Royalties
- What Do I Own? Understanding the Differences between Minerals, NPRIs, and ORRIs
- Avoid the Single Biggest Mistake Mineral Owners Make When Selling Minerals
- Mineral Flippers – Who They Are and How to Avoid Them
- How to Get the Most Money for Your Mineral Rights and Royalties
- How Selling on Shale Marketplace Works
- Frequently Asked Questions about Selling