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TMS Louisiana Royalty Fund

Posted by bernell on August 18, 2014

These questions routinely come to us:

How much are my royalties worth?

Should I sell?

What's a fair price?

These are not questions we feel qualified to answer.

Instead, we encourage folks to consider what their royalties COULD be worth if they didn't sell, then to consider their financial situation and decide if they want to sell or not?  In general, we suggest folks think long and hard before selling minerals or royalties.

But we also have to encourage royalty owners to consider the possibility that their particular property may not be drilled or may not be as productive as their neighbors, if drilled.  All wells are not created equal.

So, most folks will consider the options of keeping or possibly selling (at least some of) their royalties as this play progresses and purchase offers are made. And, let me say that IF you do decide to sell, we have folks may be willing to discuss an offer with you and you are welcome to submit information to us to allow them to do so from our Minerals section.

But, if you meet certain requirements and own royalty rights in Louisiana, there is also an option not currently available to Mississippi owners.

You can take some of your royalty rights to pool with other royalty owners in Louisiana in order to spread your risks.

It's an old adage, but one appropriate to this conversation. If you decide you don't wish to sell your royalties, do you want all of your eggs to be in one basket?

For right now, in Louisiana, the northern Tangipahoa area seems hot coming on the heels of the success of the Blades 33H, but this doesn't guarantee that nearby wells will be as successful  

In fact, there is little doubt.  Nearby wells will almost certainly be either better or worse than the Blades 33H-1.  It is highly unlikely that nearby wells will be the same.  

And, we don't really know enough today to determine for sure that East Feliciana won't end up being a hot spot later on...or St. Helena...or Washington...or (dare I say it) St. Tammany!  

There remains a lot of uncertainty in the TMS.

So, rather than sell or keep, the third option is to place your royalties in a pot with others and spread your risks/rewards out.

You now have even more questions...right?

Thought so...go here to get some of them answered...then, you may wish to make an appointment to learn even more.

Good Luck!

TMS Royalty Fund

What do you think about it?