Lodge joined the Warriors midway through the 2021 season from the Brisbane Broncos, and was in the final year of his current contract with a player option for 2023, which appears to be the point of contention.
Despite having a player option for 2023, the Daily Telegraph reports that has to be paid out as well.
It was a hot topic on the NRL 360 show as the hosts questioned how such a reported payout had occurred.
"This story is a bizarre one and I can't understand and I would love someone to explain it to me, but Matt Lodge has been given a release from the Warriors, but paid out in full for the rest of this season and the rest of next year," Braith Anasta said on NRL 360.
"It doesn't add up to me. What has happened here?"
Fellow host Phil Rothfield, who wrote the story for the Daily Telegraph, said Warriors' fans will want answers.
"I have been chasing this story all day and it still remains a $700,000 question mark," Rothfield said.
"That was the size of his golden handshake. If any football player walks into his employer or any employer and says, I have had enough and for personal reasons I don't want to move my family to New Zealand, say OK fine that's the end of the contract.
"But for some reason and the CEO of the Warriors Cameron George won't explain it to me. I have texted him. I have rung him. He is hiding behind confidentiality clauses.
"But there is a lot of fans in New Zealand wanting to know why he got $700,000. It ruins their cap for the remainder of this year and next year."
Anasta added that it didn't make sense.
"If a player goes in and asks for a release and it is on their terms because they don't want to go to New Zealand, they don't get 95 per cent of the payout or close to 100 per cent," Anasta said.
"You don't even get close to that."
The club had talks with the Australian enforcer ahead of the 2022 campaign about a contract extension, but Lodge said he wasn't in a position to commit to the club on a long-term basis.
The Warriors will be returning to New Zealand on a permanent basis next year, and Lodge confirmed that was a factor in the decision for the two parties to part ways.
"I couldn't see my family living in New Zealand for a long-term future," Lodge admitted.
"Therefore we decided that the best thing for the club was for us to mutually part ways so they have some clarity.
"I respect the club and especially the boys a lot and hopefully I showed that by the way I trained and played physical and gave my all every game."
Last week club chief executive Cameron George said Lodge had informed the club of his position a while ago.
"The opportunity for him to leave now allows us to move forward with our future planning and to develop our younger players," George said.
"We're grateful to Matt for the contribution he has made since joining us last year and wish him and his family all the best for the future."
Lodge made 14 appearances, his most recent being in last weekend's 32-30 loss to the South Sydney Rabbitohs.
