Oil and Gas – The Story |
The world consumes 85 million barrels of oil every day. And even though oil prices are down for the moment, in coming years, we will see the world’s worst fuel shortage…But every approaching crisis equals an opportunity for investors…
Oil reserves are dropping every year. Experts have been warning us about the concept of Peak Oil for decades. The theory is that for any given oil field, production tends to increase until it reaches a “peak” right around the halfway point of the reserve and then tapers off in a bell shaped curve. There are many reasons to believe we are there now.
From the ground to the pump… or the playing field… or the medicine cabinet… each and every day Americans rely on the products created by oil and natural gas. And behind this vital product is an important story that needs to be told. Whether it’s:
* Learning the value of oil and natural gas in fueling our way of life
* Recognizing that energy efficiency has its benefits
*That a rapidly growing world still needs greater supply
* That in just one 24-hour period, the oil and natural gas industry delivers:
Enough energy to heat over 80 million homes
382 million gallons of gasoline to service stations, enabling 200 million drivers to get to work, take their kids to school, and take vacations– traveling 7.5 billion road miles every day
67 million gallons to airport terminals, enabling 30,000 flights to travel around the world
* That every day, the industry employs 1.9 million people directly, and many more indirectly.
What are the risks?
Direct investments in oil and gas can provide potential returns, cash flow and tax benefits which exceed traditional investments. However before making direct investments in oil and gas wells, investors need to assess and control the risks involved, to the extent possible.
At StreamOne, we manage and counter risk factors by exercising the following measures:
We drill wells in fields that have already been proven to be successful.
We leverage by drilling multiple wells per project. If one goes poorly, the rest balance it out.
We drill with experienced and reputable companies.
We only use a small portion of funds from a group of accredited partners.
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What is an Oil and Gas Limited Partnership? |
A partnership consisting of one or more limited partners and one or more general partners that is structured to find, extract, and market commercial quantities of oil and natural gas. The limited partners, who assume no liability beyond the funds they contribute, buy units in the partnership. All the limited partners’ money then goes to the General Partner (the partner with unlimited liability), who either searches for oil and gas (an Exploratory or Wildcat Program), drills for oil and gas in a proven oil field (a Developmental Drilling Program), or pumps petroleum and gas from an existing well (a Completion Program). The riskier the chance of finding oil and gas, the higher the potential reward or loss to the limited partner. Conservative investors who mainly want to collect income from the sale of proven oil and gas reserves are safest with a Developmental or Completion program. We are only involved in Developmental and Completion Programs.
Subject to Passive income rules, limited partners also receive tax breaks, such as depreciation deductions for equipment used for drilling and oil depletion allowances for the value of oil extracted from the fields.
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Why should you be involved in Oil and Gas Limited Partnerships now? |
The drop in oil price has made now an advantageous time to invest in Oil and Gas. Investing during a “correction” rather than a “boom” increases profits as operating costs are lower and property leases are less expensive. $150 dollar oil prices not only caused problems for the economy but the oil industry as well (i.e., higher operating cost, employee cost, and property lease cost – all of which is passed along to the investor). Most respected oil men like T. Boone Pickens and Charles Couch made their fortunes when oil prices where between $15-$25 dollars a barrel. So is now a good time to invest in Oil and Gas? There is no crystal ball; however, the fundamentals seem to agree with Boone Pickens that, “oil prices in the $40 a barrel range are not going to last much longer”. Even at $40 our investors are yielding double digit returns. Oil prices WILL start to rise again! Smart oil investors drill when it’s inexpensive to do so.
Tax benefits of being involved in Oil and Gas Limited Partnerships
There are significant tax benefits for domestic drilling. Oil and Natural gas from domestic reserves helps to make our country more energy self-sufficient by reducing our dependence on foreign imports. In light of this, Congress has provided tax incentives to stimulate domestic natural gas and oil production financed by private sources. Drilling projects offer many Tax Benefits and these benefits greatly enhance the economics. These incentives are not “Loop Holes” - they were placed in the IRS Tax Code by Congress to encourage private investment in domestic natural gas and oil production. |
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Disclaimer |
| Any and all information on this web-site should not be construed in any direct nor indirect manner as a solicitation for securities under the SEC rules and definitions. The information is intended to give the private investor an alternative. This is intended to be a private transaction. We cannot guarantee the completeness, timeliness or accuracy of the information contained in this website. Any and all decisions based upon the information contained herein are the sole responsibility of the user. |
