The Appraisal and Valuation of Mineral Rights

June 19-20, 2019 | Denver,CO ::

The appraisal and valuation of mineral rights and interests is often mysterious even to many who work in the Oil and Gas industry. The exercise is even less certain when the process involves the leasing of property, sale of minerals, assignment of overriding royalty interests, and more. 

This class is designed to provide basic tools to allow participants to more meaningfully and independently determine the value of minerals in a multitude of contexts, as well as better being able to assist their own appraisal and valuation experts in determining the value of minerals that they are buying, selling, assigning, lending against, or otherwise doing business around. Against the backdrop of the Uniform Standards of Professional Appraisal Practice, this class will assist a wide range of participants no matter their professional, educational, or oil and gas related experience.

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Learning outcomes

Attendees will:

• Gain knowledge about the history of the industry and its modern trajectory
• Better understand the appraisal and valuation process
• Review the different components of the industry and how they work together
• Recognize the various modern methods of appraisal
• Be exposed to industry terms, jargon, and definitions
• Have an understanding of the Uniform Standards of Professional Appraisal Practice
• Be able to meaningfully assist appraisal experts in determining mineral value

Credits

EUCI is accredited by the International Accreditors for Continuing Education and Training (IACET) and offers IACET CEUs for its learning events that comply with the ANSI/IACET Continuing Education and Training Standard. IACET is recognized internationally as a standard development organization and accrediting body that promotes quality of continuing education and training.

EUCI is authorized by IACET to offer 1.0 CEUs for this event.

Instructional methods

Lecture, PowerPoint, and in-class case studies.

Wednesday, June 19, 2019

8:00-8:30 a.m. :: Registration & Continental Breakfast

8:30 a.m. – 5:00 p.m. :: Course Timing

12:00 – 1:00 p.m. :: Group Luncheon

Thursday, June 20, 2019

8:00 – 8:30 a.m. :: Continental Breakfast

8:30 a.m. – 12:00 p.m. :: Course Timing

• General background and history of mineral estates (severed estates, real estate vs. mineral appraisal, royalty vs. working interest, etc.)
• When do you need your rights appraised?
  • Selling
  • Estate planning
  • Transfer of ownership
  • Tax-related planning and reporting
• Basics of appraisal (break into distinct sections to go into greater depth)
  • Technical examination
  • Management of results to account for circumstances that affect present and future value
  • Things to consider: what the minerals are, location/infrastructure, the project itself, who are the buyers/lessees, geology, prices, production
• History of mineral appraisal
  • Based on proven reserves
  • Three main approaches
    • Comparable sales (prior sale of property and sales of comparable property)
      • Need to make a number of assumptions (identical properties have identical values, value in property size is linear, outliers should be removed, etc.)
    • Discounted cash flow (income)
      • Need reliable property production, costs, and pricing
      • Expected cash flow vs. risk
    • Cost analysis
  • What activities can negatively affect present and future value?
    • Filing a lease
    • Seismic studies
    • Drilling
    • Pipeline availability
    • Access/easements
    • Use of chemicals
    • Price of oil and gas
    • Regulatory issues
    • Cost of exploration and production
    • Newer access to the international market
  • Nuances in determining appraisal value. Which is best?
    • Producing vs. non-producing
    • Unreliable: rumors, old information, value of neighboring property
    • More reliable: market value
  • Uniform Standards of Professional Appraisal Practice
    • Can appraise only for the highest and best use of the property
  • Differences between the valuation of mineral estates, surface estates, and royalties
  • Residual values of mineral rights from comparable sales, research of area mineral deeds and determine fair market value, cash flow analysis using the well’s existing income
  • Avoiding speculation

Ralph Cantafio, Partner, Feldmann Nagel Cantafio Margulis PLLC

Ralph Cantafio has over 30 years of legal experience. Ralph is a partner of Feldmann Nagel Cantafio Margulis PLLC where he focuses his practice on Oil and Gas law, commercial transactions, and commercial litigations. He is licensed to practice in state courts in Alaska, Colorado, North Dakota, Texas, Utah, and Wyoming, as well as a host of U.S. District Courts, the U.S. Tax Court, the U.S. Court of Claims, the 3rd and 10th Circuit Courts of Appeals and the United States Supreme Court.

In addition to his law practice, Ralph is an Adjunct Professor at the University of Colorado Denver where he teaches in the Global Energy Management Program. His past courses include Environmental, Regulatory, Legal, and Political Environment in the Energy Industry and Land Use and Energy Contracts. Ralph has also lectured foreign professionals, primarily from Nigeria and China, focusing on international Oil and Gas law and international contracts and their drafting. Ralph also lectures on commercial transactions and litigation and regularly contributes articles to legal journals and trade periodicals.

Ralph’s education includes a Juris Doctorate from the University of Colorado School of Law, a Master of Science in Mineral Economics from Colorado School of Mines, a Master of Science in Global Energy Management from the University of Colorado Denver, and two professional Oil and Gas certificates in Petroleum Land Management and Energy Finance from the University of Denver.

EUCI Office Building Conference Center

4601 DTC Blvd, B-100

Denver CO, 80237

 

REGISTER NOW FOR THIS EVENT:

The Appraisal and Valuation of Mineral Rights

June 19-20, 2019 | Denver,CO