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Permalink Reply by Keith Mauck (Site Publisher) on October 13, 2010 at 7:00

Hi Teresa, there has been numerous discussions on this topic and they can be accessed by utilizing the search function on the homepage.

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Permalink Reply by Keith Mauck (Site Publisher) on October 13, 2010 at 7:02

Here is a link to such a search...
http://www.google.com/cse?cx=partner-pub-4090140519734877%3A2jrik1j...

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Permalink Reply by Teresa on October 13, 2010 at 9:05

thanks

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Permalink Reply by Bacon on October 13, 2010 at 9:39

$300-$600 per acre per well is a reasonable figure to plan on. So for one well and 20 acres, $6000-$12,000 per month for the first several months then declining from there. You'll owe the tax man almost half of every months check.

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Permalink Reply by Linda Whatley on October 13, 2010 at 13:38

From what I hear, it's more like a little over a hundred dollars an acre. Sure hope what I'm hearing is wrong!

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Permalink Reply by ledlights on October 14, 2010 at 3:57

There are some pretty important assumptions baked into those estimates. What range of gas prices and well production rates is being assumed? Also, as far as taxes go, make sure that you are accounting for depletion when you do them.

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Permalink Reply by Dion Warr, CPL on October 13, 2010 at 10:57

Teresa:

Certainly you may get lots of advice on this topic, let me offer some advice to relate to your friend on a related topic:

Don't count on the money until it comes,
Don't use the money to justify other purchases,
Don't budget based upon possible future returns,
Don't believe your well will perform like "X" well until it actually does.
Make cure to put aside enough to pay your tax the moment the money comes in, and don't borrow from it so that you can pay it when it's due.
Put aside enough for a rainy day; that well produces oil and gas, not perpetual sunshine.

Related advice being related by someone else (sorry, can't take credit for this one): "Most of us live from paycheck to paycheck anyway, so treat mailbox money like you've just spent your last dime and you just got an unexpected Christmas present. Then every month that mailbox money comes in will be like Christmas."

Good luck to you and your friend. Maybe your friend will buy you a present!

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Permalink Reply by DrWAVeSport Cd1 on October 13, 2010 at 11:09

Dion,

Great Advice...Unless of course you are...Chk, Hk, XTO, Shell, BP, EXCO, etc. Then just do the opposite! (LOL)

DrWAVeSport Cd1

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Permalink Reply by keb on October 13, 2010 at 11:42

very wise advice Dion

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Permalink Reply by Linda Whatley on October 13, 2010 at 13:36

Good adivce Dion......... don't count on it till you see it!

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