Why Audit Midstream Contracts
Contracts between gas producers and midstream companies are highly complex, involving detailed gas plant allocation processes and complicated pricing algorithms. Beneath this complexity lie opportunities to recover value.
Why Production Payment Reviews are Important
Companies often don’t realize the full value of what’s agreed upon in their contracts. A lack of transparency in midstream contracts causes errors regarding payments owed and fees charged to producers. Our Production Payment Reviews (Gas Plant Audits) clarify what you’re owed and what you owe, preventing future inaccuracies.
Why Choose Revenew
Midstream companies often issue net checks with deductions exceeding contract allowances, which many producers find difficult to identify. Our team has deep expertise in these gas plant audits, with auditors who have prior roles in Producer Revenue Accounting, Gas Plant Engineering, Midstream Revenue Accounting Settlement, and Midstream Commercial Negotiation. This ensures thorough reviews that address accounting, commercial, and technical operational issues.
We Uncover Discrepancies Such As:
- Incorrect deductions on product net-back pricing.
- Faulty fuel/electric calculations, CPI adjustments, or average price calculations.
- Overbilled field/buyback gas or exceeded contract margin caps.
- Inaccurate gas analysis or meter fees.
- Internal marketing cost deductions and other intercompany fees.
- Disallowable fees for midstream operator capital investments.
- Inaccurate settlement for bypass gas that is sent to other plants.
- Aid-in-construction recovery issues.
- Gas quality billing issues (e.g., Excessive H2S, CO2, N2 treating fees).
- Pipeline pressure issues where credits are not issued to producers.
Urgency is Required
Midstream contracts limit recoveries to just the past 24 months, meaning any amounts beyond that window are unrecoverable. That’s why having a structured, timely audit plan for Midstream contracts is essential.
A Proven Process
Revenew's Production Payment Review team meticulously reviews each contract and settlement statement to pinpoint exactly where and why short-pay or overbilling has occurred.
Beyond identifying errors, we also pinpoint their root causes, providing insights to improve billing processes, support documents, spreadsheets, systems, or business partner relationships to ensure accurate payments and billings in the future. We’ll remain hands-on until you receive a settlement and will assist in the negotiation process.
