* HIGH FINANCIAL REWARDS, i.e. several projects offer:
Return of Capital in 6 to 12 months
Better than 5 to one Return on Investment
Greater than 50% Annual Rate of Return
Average well is less risky than 10 years ago. Several projects have a probability of success better than 90%..
Available projects would be economically attractive if oil price would fall 50%.
* DRILLING PROSPECT AVAILABILITY
Small drilling prospects are better than ever (and there are more of them).
* TAX BENEFITS (View more information)
Drilling is the very best tax advantaged investment (Newsweek).
Congress gives tax breaks to individual investors that are not available to large companies.
100% tax deductible … 65 to 80% can be written off in first year.
Up to 100% tax-free income.
The big money has gone offshore and overseas, because there are too few easy-to-find big oil fields remaining.
Over 10,000 oil companies have left the arena since 1982.
* LEASE COSTS
Oil companies are not as anxious to renew expired leases (so lease costs are low).
* DEMAND/CONSUMPTION(View more information)
Petroleum demand is doubling about every 10 years.
U.S. oil stock piles are at 27 year low. (14 days of domestic consumption)
* OIL PRODUCTION TREND
Over two-thirds of domestic oil wells are classified as marginal (avg = 3 bbls/day).
Imports are now over 60% (imports were 30% just before the oil embargo).
* PRICE FORECASTS
Long range projections are up.
* DRILLING COSTS
Rig activity is low, therefore, drilling costs are lower.
Recent advances in oil finding technology has improved recovery and reduced risk.
Some companies report 85% success on wildcat wells.
Sierra Club endorses natural gas
Combustion by-products of natural gas are carbon-dioxide and water.
Encourages domestic drilling with special tax breaks.
Mandating natural gas usage over oil and coal.
Natural gas is now deregulated.
* MONEY CRUNCH
Traditional sources of drilling money are no longer available (which is a bonanza for independent investors).