How can I invest in oil and gas exploration?

Through direct investment with Legacy Exploration, you can be a part of a standard oil and gas industry joint venture. Each of our wells are their own Joint Venture. Ownership in that each joint venture gives the investor direct participation in all aspects of ownership revenue potentially generated from production. Despite the different risk-to-reward profile, there is a benefit of tax deductions and potential for high returns dependent upon the success of the well.

What are the risks associated with investing in oil and gas?

There are varying degrees of risk in all investments, including partial or complete loss of capital. This can occur with just about any investment these days. Direct oil and gas investments are no different. Dry holes are very much a part of the industry and even the biggest and most experienced companies are not immune. As both the owner and operator, we have an individualized approach to taking exploration risks. Legacy allows qualified investors to invest in joint ventures that it organizes as general partnerships. If you are selected as a qualified investor, you will receive a Confidential Information Memorandum that will describe in detail the terms of the investment. Please carefully read the section entitled “RISK FACTORS” in the Confidential Information Memorandum and consult your legal, tax and financial advisors before you consider making an investment in an oil and gas project.

What are the tax benefits of investing in oil and gas?

Several major tax benefits are available for oil and gas companies and investors that are found nowhere else in the tax code. An investment into a drilling program will result in favorable tax benefits no matter the outcome. In the event of a dry hole, a write off is generally allowed for the entire amount invested for the tax year the investment was made.

  • Tangible costs, which pertain to the actual direct cost of the drilling equipment are 100% deductible but must be depreciated over seven years.
  • Intangible drilling costs generally constitute 65-80% of the total cost of drilling a well and are100% deductible in the year incurred.
  • Lease operating costs and all administrative, legal, and accounting expenses can also be deducted over the life of the lease.

When should I begin to see a return on an active well?

Generally, the first revenue check is mailed within 30-60 days of the start of production. This can also be referred to as the “initial payout” of capital. Depending on the potential of the well, achieving an initial cash-on-cash payout within 18-24 months is considered excellent.

I am interested in investing. Where do I go from here?

Our team would be happy to discuss our current project with you. Please contact our office at 214-736-7766, or visit our About page to choose a team member to contact directly.