Saturday, August 7, 2010

FLO MO GAS MYTH #4

FLO MO GAS MYTH #4: Gas drilling royalties will bring significant income to the residents surrounding Hilliard Field.

The average homeowner has a 1/4 acre lot. With the help of industry insiders, we calculated estimated royalties using nearby (Williams) production data, typical well spacings, a 15 year year life span,... a 22.5% royalty to the homeowner, and NYMEX (New York Mercantile Exchange) futures data .

The result? The average monthly payment (non-discounted) over the expected life span of the well, is approximately $22 before expenses. When taxes and expenses are deducted, the average homeowner would realize less than $15 per month.


Or said another way...less than 50 cents per day.

1 comment:

Anonymous said...

WHY WOULD ANYONE IN THEIR RIGHT MIND SUBJECT THEMSELVES TO THIS FOR $15 PER MONTH!??!!

Insane.