Diminishing returns

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-	Production from gas wells in the [[Marcellus shale|Marcellus]] and other shale plays is a matter of '''diminishing returns'''. A well's initial production begins at a much higher flow rate of natural gas than will happen over its lifetime. Roughly half of the production comes in the first two years. After that, it declines in a long diminishing tail. Hence, most of the royalty payments, generally based upon a percentage of gas sold from each well, also come in the first two years.	+	Production from gas wells in the [[Marcellus shale|Marcellus]] and other shale plays is a matter of '''diminishing returns'''. A well's [[initial production]] begins at a much higher flow rate of natural gas than will happen over its lifetime. Roughly half of the production comes in the first two years. After that, it declines in a long diminishing tail. Hence, most of the royalty payments, generally based upon a percentage of gas sold from each well, also come in the first two years.

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Current revision

Production from gas wells in the Marcellus and other shale plays is a matter of diminishing returns. A well's initial production begins at a much higher flow rate of natural gas than will happen over its lifetime. Roughly half of the production comes in the first two years. After that, it declines in a long diminishing tail. Hence, most of the royalty payments, generally based upon a percentage of gas sold from each well, also come in the first two years.