Setting the stage for increased natural gas prices in 2021
Friday, April 3, 2020
Unprofitable drilling, a global recession and dwindling access to capital could all contribute to a decline in natural gas production that may finally lead to increased prices in 2021, according to Yahoo Finance.
The continuous increase in natural gas production from one year to the next led to a supply glut prior to the onset of COVID-19. Gas from the Permian Basin and Marcellus Shale crashed prices below $2/MMBtu at the beginning of 2020. Many large companies were forced to write down assets because of the low prices.
Now, natural gas production is expected to peak and declines to follow. If demand rebounds and production output continues to slide downward, prices may finally rebound in 2021.
Learn more: Yahoo Finance > Natural Gas Prices Could Double Next Year
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How often do royalty payments come?
Depending on the company, royalty payments can arrive monthly or quarterly.
Are my royalty payments transferable?
Yes. If you plan on selling your property, notify the gas company that is leasing your land and your realtor. They will make arrangements to allow the royalty payments to transfer to a different land owner.
What are royalties?
Royalties are payments from the gas company to the landowner as part of a lease agreement. Royalties payments cannot begin until production begins. The payments are dependent upon the market price of the resource.