Every oil and gas investment that one chooses to participate in whether it's a brand new drill, or something else, is always going to be risky. What we do to try and mitigate risk is get in areas that have multiple different formations. This allows us to get into wells that give us more than one opportunity to hit for oil and gas. If the drillers are going to start a well that passes through five different formations, we get five different chances per drill to hit something that could be productive and generate income. For this reason, we try to get into the best areas that have multiple different formations. We also strive to get into the best areas that already have proven production, which would be an area where wells are already producing or an area of existing production that is in close proximity to where we are currently drilling. Obviously, when we partner up with the operators we like to make sure that they have a good track record and a consistent track record of hitting producing wells and generating income. This gives us, as well as our investors, confidence in the process. In conclusion, these investments can be risky but we attempt to mitigate the risk as much as possible by making sure we are in the right locations, with the right people, and getting in at the right prices. Comments are closed.
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