the following is an excerpt of copyrighted material....
Considering Investing in a working interest in an oil and gas well us?
Consider this:
The preferred Investor:
......."These are an excellent resource with a plethora of information as a starting point for your due diligence. Talk over questions with your tax person and qualified oil and gas individuals."{......"the more informed you are as an individual the better for us".
If after your are comfortable in your understanding consider this:
Invest with the "worst case" scenario in mind. This would be that we drill the well(s) and we find nothing. This is called a "dry hole". Now no one drills for oil and gas and sets out to drill a dry hole. With today's advanced seismic technology, geologist review, producing wells adjacent to our project; etceteras, the chances for success are greatly improved in the proximity of 70% or greater.
However, the United States tax code is written to spur domestic oil and gas exploration. In this light if we drill a dry hole, the individual is able to write off, against ordinary income, 100% of their investment in that tax year the well is drilled. Confirm this with your tax person.
If you are comfortable with that scenario in mind, then weigh the potential for profits and the tremendous tax benefits on a successful well(s), and know why we ask:.....
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