When I noticed a steep drop in royalties, I contacted the operator who said the decline in price in natural gas was due to what he called the GateWay project operated by Dominion. The operators sell to Dominion, who is in the process of updating their lines and facilities in this area. In order to do so the operators have to aid in this project, this aid is in the way of a price reduction in their purchase price, and the surplus monies is being sent to Dominion to help build the projects. Has anyone else heard of this reason for the price dropping?
I haven't. But it sounds a little shady to me. You should check your lease to see what they can deduct in the way of post-production costs.
Dominion has some info about their Gateway Project here. The project was completed in September of 2012.
James, I haven't heard this reason for the drop in royalties....but my operator said Dominion had "shut them out" for a couple months or so. I know we did not receive one dime in royalties in March, and I feel we probably will not receive any here in April.
Thanks for the information. In November I was paid $2.74 per Mcf for July run, in December $2.99 per Mcf for August run and January $1.28 per Mcf for September run. There were no payments for February and March. I was told will receive one soon. Also told the wells are good wells. Are these payments in line with other’s payments?
We too are paid in arrears. We have three wells. My sister and I have 1/2 interest in the minerals rights. Our checks for the last six months approximately have been from $70 down to $30 in February (that is for all three wells royalties to each of us.) As mentioned prior in March and so far in April, $0.