The OCC reported gas volume as 4694 but I was paid for 2465.32. I requested an explanation was told the OCC volume was wet gas and the oil company pays on residue and NGLS.
How is this conversion made and how do I determine if I am receiving the correct payment?
There’s no real way to calculate that yourself. Basically, dry gas is almost pure methane, while wet gas contains heavier components like ethane, propane, butane, etc. The wet gas is put through a gas processing plant where the heavier components are removed as Natural Gas Liquids (NGL) and sold separately. After that process, the residue gas stream will have shrunk considerably. The exact shrink is highly dependent on the gas composition and the plant efficiency, but your numbers do not look unreasonable.
You could request a copy of the plant report, but I wouldn’t be sure they would provide it. Chances are, you couldn’t read it anyway. (I’m an engineer with 42 years experience and I find most plant reports difficult to decipher, as there’s no standard format) If the dollar figures are high enough to warrant it, you can always hire someone to do an audit.
Hello!
I have also found discrepancies on my royalty statements. Where would I go to find someone to do an audit?
Michelle
@Michelle_Mitchell I’d suggest you mention the state and even county to provide better context for possible answers.
I would be interested in an audit in Howard County.
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