SILENT AUCTION
OPPORTUNITY
UPCOMING
SILENT AUCTION OPPORTUNITIES
Weekly Auctions/Trade Days - every Tuesday
Houston, Texas
Click
here for details.
Trade
Days is featuring the following: one $10,000,000 Mid-Continent
Divestiture and one $125,000,000 offshore property.
All
of the above divestments have minimum bids that are subject
to seller accepting option bid.
Sellers!
It’s not too late. You still have time to include
your prospects, large acreage blocks and producing leases
in these upcoming forums. Listings can be entered by mail
or fax. Don’t delay. Sign up now for good placement.
Buyers!
Don’t miss out on these opportunities to meet with
your peers in the industry and take advantage of these buying
opportunities.
The
Option
These silent auctions are an opportunity to buy, sell or
trade the option to evaluate and research the property for
up to six days. During those six days, the winning bidder
has the exclusive right to buy the lease at a full price
or a negotiated price with the seller.
In the six-day option period, the property can be examined
by a geologist, a title search can be performed, a pumper
can be contacted, and an on-site inspection can be performed.
The option period can be extended by doubling the option
price.
The seller has placed a minimum price on the property, but
the buyer has the choice to negotiate with the seller on
the purchase price, as part of a purchase an sale agreement
executed by the Buyer and the Seller, with Global Trade
Days, Inc., as the agent.
If the option bidding exceeds 20% of the minimum price for
the property, the auction converts to bidding on the property
itself, and the property is sold at final auction. For example,
if the bid option for a one-million dollar piece of property
exceeds the 20% value of the property--$200,000--the property
would be immediately reauctioned for a final sale price.
Benefits
for the Buyer
The option makes the evaluation process more cost-effective
and timely for the buyer. This process eliminates the expensive
advance due diligence that is wasted when a buyer is outbid
on a chosen parcel. For example, the buyer may need to purchase
expensive equipment, such as 3D seismic, to assess the property.
The option will make this purchase decision more comfortable.
The
concept of putting down a small amount of cash in order
to optimize the opportunity to evaluate and make the purchase
decision on the oil and gas property provides a new level
of excellence in auction effectiveness, insuring minimal
risk for the buyer. The option money goes toward the purchase
price if the sale is made.
Benefits
for the Seller
The seller also enjoys benefits of the option process. It
is a great opportunity to get the property in front of more
potential buyers. The seller has the option to set the minimum
bid price. The tie-up period for the property is shortened.
The seller must deal with fewer people before the sale,
and with only one winning party. This will help reduce the
risk of upsetting existing staff. Another advantage is that
the seller can walk in the day of the sale and list the
property, thus minimizing the cost of advertising fees and
related expenses.
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