Dear Investors, most people want to know if an investment strategy will protect their capital, and make them money. Time as it relates to ‘return of capital’, or ‘return on capital’ is usually the biggest factor most are concerned about when deciding where and what to invest-in.
Risking capital decisions are or should be viewed differently than when making safe, and long term or long range investment return decisions based on protection of capital. At some point, any investor is typically thinking. Can I live on the returns, or pass on my legacy and my wealth while keeping as much of my money as possible while taxation, capital gains, and inheritance taxes are looming large.
Oil & gas investments in drilling programs, or with smaller independents who are investing with tax benefits being passed-on to private investors should be considered when an investor’s gross income for taxes are high, and the investor believes our basic energy needs will be fulfilled by the recovery of oil & natural gas reserves which are found 85% of the time by the smaller independent oil & gas companies.
The real key is knowing how to plan an exit strategy, while taking advantage of the current oil & gas tax write-offs, and taking the steps to grow the smaller independent oil company. You can plan for an exit strategy with traditional private sales, auctions, and with new public companies. Public companies offer the best exit strategy for smaller independents, and especially for the private investor who takes the leap, or chance with a smaller independent oil companies engaged in drilling for oil & gas. The stock market is still the most attractive, and speediest way to trade or sell assets of a new oil & gas company having success with their developmental drilling program. New technological advances help tip the balance for the greater movement, or greater short term profits possible with a small independent oil & gas company. 2-5 years would be considered a short period of time to expect a larger return than is possible with well established oil & gas companies, and is likely the minimum time line for making big returns on investments based on my 29 years of experience in the industry.
