* RISK 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.
* COMPETITION 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 Petroleum demand is doubling about every 10 years.
* 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 lowest in 50 years, therefore, drilling costs are low.
* TECHNOLOGY Recent advances in oil finding technology has improved recovery and reduced risk. Some companies report 85% success on wildcat wells.
* ENVIRONMENT Sierra Club endorses natural gas Combustion by-products are carbon-dioxide and water.
* GOVERNMENT 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).