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Started By
Message
re: Investing in an oil well
Posted on 10/16/13 at 8:04 am to SetTheMood
Posted on 10/16/13 at 8:04 am to SetTheMood
quote:
Estimated BPD is 170 and estimated total yield is 250,000 barrels.
That would be amazing. Assuming the lessor signed for 1/4 royalty, and further assuming $100/barrel: your 1.8% would net you $9180/month and $450,000 over the lifetime of the well. If something seems too good to be true, it probably is. Then again, I've spent $12k on dumber things...
2
Posted on 10/16/13 at 8:21 am to GaryMyMan
Google gulf coast western scam and that's about all you need to know about this. I know you're talking about a different company, but what they do is pretty similar.
Do some research on what it truly costs to drill and then compare what they are saying they need to drill. Also see what percentage they normally hit on and see what their return history shows with other investors.
Be very careful...
Do some research on what it truly costs to drill and then compare what they are saying they need to drill. Also see what percentage they normally hit on and see what their return history shows with other investors.
Be very careful...
Posted on 10/16/13 at 8:35 am to GaryMyMan
quote:
If something seems too good to be true, it probably is.
I have a feeling you're right...
That being said, despite my better judgment and the solid advice handed out in this thread, I'm likely still going to do it. The group of investors are older guys I've known for a long time, including some family members, and guys who have done quite well for themselves. They reserved a few single shares for younger guys they know (5 of us) to try to get in on some action. All admit this is a risky endeavor, but that the numbers they've seen on this particular well are promising.
I'll bump this thread periodically to let everyone know if I would have been better served investing in something awesome, like a jetski.
Posted on 10/16/13 at 8:40 am to SetTheMood
quote:
Assuming the lessor signed for 1/4 royalty, and further assuming $100/barrel: your 1.8% would net you $9180/month and $450,000 over the lifetime of the well
I would dial back your numbers to see if it would be worth it to the OP. After expenses and taxes, lets say you only come up with $2,000 a month. You would be paid back in 6 months and then collecting mailbox money. If you feel confident in the person that brought you the info I would nail that. There are not many things that can pay off like an O&G deal but be willing to lose that $12K like any other extremely risky investment.
Good luck!!
Posted on 10/16/13 at 8:40 am to SetTheMood
Yeah, go for it. Optimistic production numbers aside, my concern would be drilling costs. If that $500k turns into $1MM (easily done), then you've got to pony up an additional $12k to keep your share. That's nearly ski boat territory.
Posted on 10/16/13 at 9:37 am to SetTheMood
quote:
It's an existing well, they're just going back in. I've seen the geological survey th
My bad. You'll be paying their recomplete costs plus some profit...you're paying a promote and will never get all your money back....this is not how reputable O&G companies finance ops. I looked up navitas...their website screams scam based on overstating credentials ops. They claim to have made millions in LA but I can't find that they've ever drilled or operated a well in LA but for one well in Acadia. And that well IP after recomplete was 990 mcf.
Don't be a sucker.
Posted on 10/16/13 at 10:04 am to SetTheMood
quote:
I've seen the geological survey that was performed, and as long as they didn't doctor the findings, it looks promising.
quote:
I'm a lawyer
So you based your opinion of the geological survey on...........
Posted on 10/16/13 at 10:09 am to GaryMyMan
quote:
Yeah, go for it. Optimistic production numbers aside, my concern would be drilling costs. If that $500k turns into $1MM (easily done), then you've got to pony up an additional $12k to keep your share. That's nearly ski boat territory.
This.
Posted on 10/16/13 at 10:58 am to SetTheMood
It will produce nothing but water. Guaranteed.
Ive seen/heard about little deals like this a lot and i've never once met someone who invested in a decent well.
Ive seen/heard about little deals like this a lot and i've never once met someone who invested in a decent well.
Posted on 10/16/13 at 11:07 am to barry
quote:
So you based your opinion of the geological survey on...........
My opinion is based on the opinions of others, others whom I trust.
Posted on 10/16/13 at 2:02 pm to SetTheMood
I'm a geologist and my dad is a lawyer who occasionally gets these sorts of deals thrown his way. Pretty much every time these are a huge scam and you will likely lose most if not all of your money. Like someone said, if it was a decent deal someone else would have already invested in it before it got to you. Drilling costs are usually understated and predicted reserves almost always well overstated. Proceed with extreme caution.
Posted on 10/16/13 at 7:41 pm to SetTheMood
quote:Hire a PG that's familiar with the formation, that works for you, and is as far removed from the offering firm as you can get, to look at the seismic. It'll cost several thousand dollars. But it's a better gamble this this "deal".
My opinion is based on the opinions of others, others whom I trust.
Posted on 10/16/13 at 8:35 pm to SetTheMood
quote:go with your gut and pass on this. I've seen way too many people get burned by "prospects" like this
SetTheMood
Posted on 10/16/13 at 8:47 pm to ForeverLSU02
you are going to lose your money on this.
Posted on 10/16/13 at 9:48 pm to SetTheMood
go ahead and say bye to that money now. terrible idea
Posted on 10/16/13 at 11:16 pm to SetTheMood
12k??? Hmm.. I would make that back in 4 months with my 5 (deepest is 3500). Gotta count up costs. Idk man. Tough call. Lol.
Don't go with your gut though. Look for opinions that disagree with you.
Don't go with your gut though. Look for opinions that disagree with you.
Posted on 10/17/13 at 7:37 am to SetTheMood
Absolutely no way that well sustains 170/day for more than 1 day or 2.
Posted on 10/17/13 at 8:01 am to SetTheMood
You should be able to get a copy of the log from the operator. Find out the depth at which they plan to recomplete and do some simple research on log response (low SP or GR, high R, and "kissing" N/D is typically oil pay).
This could at least make you a bit more cofortable knowing it won't be a "dry hole".
Although previous production history of the sand and volumetrics would be needed to actually verify the validity of the prospect. Good Luck! I think you'll need it!
This could at least make you a bit more cofortable knowing it won't be a "dry hole".
Although previous production history of the sand and volumetrics would be needed to actually verify the validity of the prospect. Good Luck! I think you'll need it!
Posted on 10/17/13 at 11:43 am to SetTheMood
Just for fun and my curiosity, if this is a Louisiana well please post the well (API or Serial) and target depth.
I will check the info and logs in SONRIS - also nearby offsets. Maybe this weekend at the earliest, since I don't want to use company time or resources but will check out the public data available online.
I will check the info and logs in SONRIS - also nearby offsets. Maybe this weekend at the earliest, since I don't want to use company time or resources but will check out the public data available online.
Posted on 10/17/13 at 1:56 pm to SetTheMood
Just googled "Dan Williams" (name of the CEO) and "Navitas." The first thing that popped up was a scam forum:
https://www.worldlawdirect.com/forum/money-frauds-scams/71997-dan-williams-navitas-land-minerals-scam.html
Don't do it.
Edit: He's been popped by the SEC before for the same shite.
https://www.sec.gov/litigation/litreleases/2006/lr19786.htm
I can't stress this enough...don't do it.
https://www.worldlawdirect.com/forum/money-frauds-scams/71997-dan-williams-navitas-land-minerals-scam.html
Don't do it.
Edit: He's been popped by the SEC before for the same shite.
https://www.sec.gov/litigation/litreleases/2006/lr19786.htm
quote:
On July 24, 2006, the Securities and Exchange Commission filed a complaint in the United States District Court for the Southern District of Texas against Blast Energy Services, Inc. f/k/a Verdisys, Inc., alleging that Verdisys and former CEO Daniel W. Williams violated the anti-fraud provisions of the Securities Exchange Act of 1934 by making various misleading disclosures regarding the capabilities of Verdisys' lateral drilling technology, the status and success of its drilling operations, and its revenues, and that former Verdisys CFO Andrew G. Wilson aided and abetted the violations. Also on July 28, 2006, the Commission entered a cease-and-desist order against former Verdisys director Eric A. McAfee, finding that he caused Verdisys to make misleading disclosures regarding its expenses and revenues. The Commission also commenced a civil money penalty action against McAfee in United States District Court for the Southern District of Texas.
quote:
The Commission's complaint also alleges that various reports Verdisys filed with the Commission through late 2003, which Williams and Wilson prepared and signed, made misleading disclosures. Among other things, Verdisys' quarterly report for the period ended September 30, 2003, initially filed with the Commission on Form 10-QSB on November 19, 2003, overstated the company's revenues by nearly 100%. According to the complaint, Williams had wholly falsified reports of wells drilled, which resulted in false claims of revenue earned.
I can't stress this enough...don't do it.
This post was edited on 10/17/13 at 2:12 pm
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