6 ms·
Land acquisition costs are very low in the US (this is done through a competitive bidding process when new tracts are offered). Royalties to the government are
by exothermic 8y ago
Land acquisition costs are very low in the US (this is done through a competitive bidding process when new tracts are offered).
Royalties to the government are in the 20-30% range on a revenue basis, plus standard CIT.
This is for new land for exploration- e.g. no proven reserves at the time of the sale. If there are known reserves, then the price would be much higher but the government is not typically in the business of proving reserves themselves.
- zaroth 8y agoI seem to recall reading government reports about proven reserves. I thought we had a geological department that investigated all sorts of mineral / oil / natural gas resources.
- planteen 8y agoYes, there are tons of geologic maps produced by the government that are used by oil & gas companies. Most states require data from well logs to be reported too. I think what parent is possibly talking about is when the BLM puts up tracts for mineral lease auction that nobody wants (no economically recoverable reserves). https://www.eenews.net/stories/1060099219 https://www.eenews.net/stories/1060099219
- mtnGoat 8y agocoal is at 12%(on BLM land), depending on who you lease from, Gold can be under 1%. What is as high as 20-30?
- exothermic 7y agoYou are right- I am thinking of the typical royalties paid to private land owners onshore (either 1/8th or 1/4th). Offshore federal royalties are typically ~12.5-18.5% [1] [1] https://www.boem.gov/note07062017/ https://www.boem.gov/note07062017/