In the mineral business, we categorize assets into two main buckets: :PDP and :NPRO.

Producing (PDP)

Proved Developed Producing. These are minerals that are currently generating a royalty check. There is a well on the land, it’s pumping oil, and the operator is paying you.

Producing minerals are:

  • Easiest to value — We can see actual cash flow
  • Easiest to sell — Less speculation involved
  • Subject to :decline — Wells produce less over time

Non-Producing (NPRO)

Non-Producing Royalty Interest. These are minerals with no active wells. You aren’t getting a check.

Are they worthless? Not necessarily!

If you are in a hot area like the :Permian Basin or the :Eagle Ford, your non-producing minerals could be worth more per acre than producing ones in a tired field. Why? Because we’re betting on future wells—and new wells produce at peak rates.

The Risk: If no one ever drills, they generate zero return. Buying NPRO is a speculative bet for us, but it provides immediate cash for you.

The Best of Both Worlds: :PUD

Some minerals are currently producing AND have permits for new wells. These are the most valuable—established cash flow plus upside potential.

How We Value Each Type

TypeValuation Method
PDPMultiple of current cash flow (typically 3-5x annual royalty)
NPROAcreage value based on location and drilling activity
PUDHybrid: cash flow + discounted future value of permitted wells

:pdp

Proved Developed Producing. Industry shorthand for minerals that are actively generating revenue right now. The “proved” means reserves have been confirmed by production data.

:npro

Non-Producing Royalty Interest. Minerals that aren’t currently generating income. Value depends entirely on the likelihood of future drilling.

:decline

The natural reduction in oil production from a well over time. A typical shale well might produce 70% less in year two than year one.

:permian

The Permian Basin in West Texas and New Mexico—the most prolific oil-producing region in the United States and the primary focus of American energy investment.

:eagle-ford

A major shale formation in South Texas, known for high-quality oil and consistent drilling activity from operators like EOG and Devon.

:pud

Proved Undeveloped. Reserves that are known to exist (based on nearby wells) but haven’t been drilled yet. These locations are on the operator’s development schedule.