A Valuation of Mineral Rights in North Dakota

Fractional Ownership & Forecasting Oil Futures


A business valuation was needed for tax filings to settle an estate where one fractional owner of an LLC had passed away. The LLC owned the lease for the mineral rights on a one-acre lot in North Dakota.

Merrimack Business Appraisers’ Approach

  • Lou Pereira, President of Merrimack Business Appraisers, secured the expertise of an engineer to calculate the quantity of minerals, in this case oil and gas, that could be extracted from the North Dakota property.
  • Lou developed the valuation to include forecasted future prices of oil and gas; then applied the discounted cash flow method.
  • A thorough and detailed valuation of the business and the value of the fractional ownership was completed for settlement of the estate.

Valuation Outcome

Without the proper engineering and business valuation expertise, the business valuation of the fractional ownership of an LLC that included owning just the lease for the mineral rights on a one-acre lot in North Dakota could have been dramatically more, incurring greater tax consequences.

When it comes to business valuations, having a certified valuation professional who offers a proven process matters.

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