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Follow on Google News | Newly Formed E&Ps Hedging Bets On Mineral RightsThe demand to purchase minerals has increased, due to reduced cost in acreage pricing.
ProductionBrokers.com, an oil & gas website based out of Oklahoma City deals in auctions and listings of oil field equipment, mineral rights, and active wells amongst other energy related assets. Since December of 2014 the site has seen a surge in newly formed companies looking to purchase mineral rights, production, and working interest in traditional hot spots. "Since inception of ProductionBrokers.com, we have seen somewhat of a market for mineral rights, but when oil started tanking, the demand to purchase minerals has increased, due to reduced cost in acreage pricing" stated Ed Martin, Chief Operating Officer of ProductionBrokers.com. The actions that these newly formed groups have taken, has kept sectors of the oil & gas industry healthy in the midst of the downturn. Some experts say that even if these companies do not drill on their newly purchased assets, their investments can be looked at almost like a mineral rights hedge fund, if they hold out for the longterm. Many capital groups would agree, due to the millions of dollars that have been shelled out for support of these acquisitions. "We are seeing multiple groups come forward, mostly newly formed, utilizing ProductionBrokers.com to make multi-million dollar mineral acquisitions, along with having large amounts of cash on the sidelines, waiting on the next hot shale play acreage listing to pop up..." stated Tom Field, VP Of Marketing for ProductionBrokers.com. With oil prices rallying over the past several weeks, the market for mineral rights is still in a demand state and has somewhat self corrected. Analysts are reporting that the downturn may be ongoing for up to two years and buying up any sort of oil & gas related asset at this time for a long term gain may be the most fruitful decision to make. End
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