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Certain Relationships and Related Party Transactions
12 Months Ended
Dec. 31, 2012
Certain Relationships and Related Party Transactions [Abstract]  
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

NOTE 8 — CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

 

The Partnership has entered into the following significant transactions with its MGP and its affiliates as provided under the Partnership Agreement.

 

·         Administrative costs, which are included in general and administrative expenses in the Partnership's statements of operations, are payable at $75 per well per month. Administrative costs incurred for the years ended December 31, 2012 and 2011 were $98,100 and $103,500, respectively.

 

·         Monthly well supervision fees, which are included in production expenses in the Partnership's statements of operations, are payable at $313 per well per month for operating and maintaining the wells. Well supervision fees incurred for the years ended December 31, 2012 and 2011 were $405,500 and $427,800, respectively.

 

·         Transportation fees, which are included in production expenses in the Partnership's statements of operations, incurred for the years ended December 31, 2012 and 2011 were $138,600 and $177,200, respectively.

 

·         Direct costs, which are included in production and general administrative expenses in the Partnership's statements of operations, are payable to the MGP and its affiliates as reimbursement for all costs expended on the Partnership's behalf. Direct costs incurred for the years ended December 31, 2012 and 2011 were $347,700 and $281,500, respectively.

 

·         The MGP and its affiliates perform all administrative and management functions for the Partnership including billing revenues and paying expenses. Accounts receivable trade-affiliate on the Partnership's balance sheets includes the net production revenues due from the MGP.

 

Subordination by Managing General Partner

 

·         Under the terms of the Partnership Agreement, the MGP may be required to subordinate up to 50% of its share of net production revenues so that the limited partners receive a return of at least 10% of their net subscriptions, determined on a cumulative basis, in each of the first five years of Partnership operations, commencing with the first distribution to the investor partners (November 2004) and expiring 60 months from that date.