American Oil Well Investment

The petroleum industry is an ever expanding global enterprise, with its consumption rising continually every year. Petroleum is, after all, an essential human commodity. Gasoline and fuel, two of its most important by-products, are important for maintaining many aspects of our culture that include transportation and household.

A large percentage of the world’s oil supply comes from the Middle East with 53 percent. However, the rising prices coming from the region prompted investors to look for sources elsewhere. There is a resurgence of interest for investment in American oil wells. Oil rich areas are abundant across the US, particularly in Oklahoma, Texas, Kansas, and California. Wells that were pressured 40 years ago are still reputed to produce oil. Rework and more are now possible, thanks to newer equipments and newer technologies.
Before starting, it is important to study the market. Assess companies, operators, and industry partners well. Request a diligence report from a prospective company to assess factors such as stable finances, good history, diversification, and risk management. Choose drilling companies that have good track records. Confirm the professional ability, honesty, integrity, and past working histories of its management team and engineering staff. A professional geologist is also a prerequisite to an oil well staff. Knowing how the market works builds confidence to an investor as well.

The oil and gas industry is capital intensive, and many of its companies go back to the capital market several times before products have yet to go online. Drilling testing wells, exploration, and later production needs entail a lot of money as well. A potential investor should be ready to share a substantial amount of investment capital to a target company.

You can also opt to buy shares if you want to start conservatively. You can contact the companies themselves, even if raising capital is done through private placements. To appraise the net value of your investment, consult a licensed engineer or petroleum official. An exit strategy should be established during appraisal to ensure liquidity during the holding period.

Almost two-thirds of the oil contained in the American mainland reservoirs has been left behind because it has proved too difficult or expensive to extract. But with advanced technology and better equipments extraction rates for oil and gas have greatly improved. Oil-rich areas are abundant across the US, particularly in Oklahoma, Texas, Kansas, and California. If you are want a substantial return of profits, then invest in America’s future.

References:

http://ezinearticles.com/?Tips-on-Investing-in-USA-Oil-Wells&id=3792194
http://www.ehow.com/info_8754061_invest-oil-gas-texas.html
http://www.usoilandgas.net/about_us.htm