Want to invest in oil and gas? Not sure, how? Then, continue to read this article about Beginner’s Tip on Oil and Gas Investments for beginner’s tip.
Understand the type of Oil and Gas Industry
Remember, there are oil and gas companies out there that barely involve in actual drilling rather more interested to raise funds and then invest in drilling companies. There are also some companies that actually done the drilling and they raise their funds on their own as well.
When you are ready to invest ask them simple questions if they do the drilling as well or is there a 3rd party involve. There is always track record available that shows how they are doing. For instance, you should be able to find an area by state and zip, and by contacting local County or government about the drilling took effect and the result of that drilling.
Understand the Well
Remember, the drilling company often hits dry well and this is a common investment loss. By looking at the zone and track record, it will help you to understand in-depth. If the drilling is first time in an area that was never explored before, obviously risk factor is higher. Then there are area or zone that probably been explored as much as 20 to 30 times. There are still risk of hitting a dry zone due to low land. If you pour some oil in a bucket of water, oil will always float as you
Know. Same case here for well. If the bed rock is not flat, and if there un even bed rock or a slope that goes up and down, if the drilling hits at the peak there are chances that it will oil where if the drilling hits in a down slope or under the low area, chances are it might be just water which will turn to a dry hole.
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