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Question
I saw this opportunity and it sounds pretty good to me but since i am new to this, i will like an expert opinion. Any advice at all will be greatly appreciated. Below is what the ad looks like


GREAT opportunity to own a TRUE ABSENTEE RUN BUSINESS , you can own a piece of oil wells in McClain County, Oklahoma drilled AND operated by a $1 billion+ co. in business since 1985 and has drilled OVER 160 wells in the area. They are one of the BEST / most successful oil drilling co.'s in the country !!!! APPROVED FOR YOU TO USE YOUR SELF DIRECTED IRA ACCOUNT $ !!!! The wells are drilled on a property IN BETWEEN 2 very large oil fields that to date combined have produced OVER 25 MILLION BARRELS OF OIL !!! The co. for years has been convinced this property connects the 2 large oil fields and their 3D seismic testing shows they are correct. The first well was drilled in Nov/ Dec 2013 and high estimates were it would produce oil for 10-12 years returning approx. 8-1 on your money. Instead we have a MONSTER well that hit oil in 5+ zones and will produce oil for 40 YEARS !!!! You can pay big $ for a small business but REALITY IS Theirs no comparison between investing $250k -$500k+ in a small bus. you'll have to spend 60+ hours a week running , earn on average of less than $100k a year, plus you'll have plenty more expenses and your odds of failing are OVER 60% . OR You can spend $250k ( minimum is $50k) and break it up over the course of a year in 5 different oil well projects putting just $50k in each one. let's assume just 3 out of the 5 projects work out and hit oil ( that's below the 77% hit rate for the co. with almost 170 wells drilled in the area) and we will assume each of the 3 wells that hit come in at the LOW END earning you just $3k a month ( $50k gets you 5 units at $10k each, each unit on low end would give you approx $600 a month ) that's income of $108,000 AND IT'S 100% ABSENTEE RUN . You can go ahead and do whatever else it is you want to do , or you can work smart and stay with the oil wells . The minimum to gain ownership is just $20k , VERY limited opportunity, drilling starts in Feb.,

Answer
Do not just walk away from this offer, RUN AWAY FROM THIS OFFER!  Right now, there are extremely sophisticated investors not only here in America, but all around the world, clawing over one another to be allowed to invest in above-board oil and gas exploration and drilling projects.  I work in the industry for an exploration oil company, so I have first-hand knowledge of this.  If this "opportunity" is above-board, why do they not already have all of the money they need, on attractive terms because of the strong competition between investors? Why are they asking private individuals with little or no knowledge of the oil and gas industry to risk their retirement savings??  Make no mistake, oil and gas drilling is high, high, HIGH risk!  There can be a "monster" well 2,000 feet from the drill hole of your well, and your well can still turn out to be a dry hole!  I can't tell you how many times that happens to oil companies!  They drill a very good well, then "step out" a few hundred or thousand feet, and there's no speck of oil or gas in that spot!

If you want to invest in oil wells, I strongly advise you to visit with your stock broker and ask them to find the best mutual fund available that contains only exploration and production oil and gas companies.  The stock broker can explain the risk level to you, and also advise you on the soundness of risking your IRA account.  That way, you probably won't even see any drop in fund share value from an occasional dry hole.

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Marsha Breazeale, M.Ed., CDOA, CPLTA

Expertise

All questions regarding division orders; ownership decimal calculations; title ownership and payer record changes (testate/intestate inheritance; deed; assignment; court order); oil and gas lease analysis for record-keeping and purposes of payment by operator or payer; pooling, horizontal wells, horizontal well allocation units; unclaimed property reporting; royalty owner relations questions. All questions concerning administration of surface land contracts and payment questions, such as for Surface Right-of-Way, Sub-Surface Right-of-Way, Easement, Surface Use Agreement. All questions regarding industry-standard and company-specific policies that affect land owners.

Experience

Sr. Staff Division Order Analyst. Certified Division Order Analyst (CDOA, National Association of Division Order Analysts) and Certified Lease Analyst (CPLTA, National Association of Professional Lease and Title Analysts) with 35 years of experience as a combination division order analyst and lease analyst in exploration and production in the oil and gas industry.

Organizations
National Assoc. of Division Order Analysts (NADOA), National Association of Division Order Analysts (NALTA), American Association of Professional Landmen (AAPL), American Society of Trainers and Developers (ASTD)

Publications
"How an Oil & Gas Exploration & Production Company Operates" and "Principles of Oil & Gas Lease Analysis: Standard Clauses", Oil Patch Press; Articles in NADOA Magazine; LandFocus EDU Professional Training Manuals

Education/Credentials
B.A.in Management from Our Lady of the Lake University in San Antonio; M.Ed. in Instructional Design from WGU Texas.

Past/Present Clients
Past 15 years: GeoSouthern Energy Corporation; Contango Oil Co./Crimson Exploration & Operating Inc.; Apache Corporation; BP America; Marathon Oil; Newfield Exploration

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