Permian Basin Oil & Gas Fund

Fund Overview

A direct oil and gas partnership investing in development stage wells across key United States basins, with the Permian Basin as the primary focus. It targets known formations where production is already established rather than exploration, and is structured to deliver large upfront tax deductions, production based cash flow through the middle years, and long term value from the wells themselves. Investors may participate as general partners during the drilling phase, which is what allows the first year deduction to be taken against other income rather than suspended. The sponsor is a second generation exploration and production company headquartered in Texas with forty five years of operating history, more than 4,000 wells invested in, operated or drilled across 13 states and Canada, and co-investment of its own capital alongside investors in the same wells.

Tax Features

• Up to 90% deduction in Year 1. Intangible drilling costs represent the bulk of a well's cost and are generally deductible in the year incurred rather than capitalised.
• Usable against other income. Where investors participate as general partners during drilling, the deduction is treated as an active loss and can offset other income, not just income from the fund.
• Depletion allowance. An additional 15 to 25% annual deduction becomes available as hydrocarbons are produced and sold, reducing tax on production income over the life of the wells.
• Equipment depreciation. Tangible drilling equipment is depreciated on an accelerated basis, with bonus depreciation potentially allowing immediate expensing of a significant portion.
• Deductions land early, value builds later. The largest deductions occur during drilling and completion while cash flow accumulates over years of production, creating a favourable timing profile for investors with income to shelter now.

Key Terms

• Structure: Delaware limited partnership, with general partner participation available during the drilling phase
• Strategy: Development stage oil and gas wells across key US basins, primary focus Permian
• Target fund size: $250 million
• Minimum investment: $100,000
• Targeted distributions: Quarterly, targeting 12% annual cash flow for the first five years, beginning approximately 12 months after deployment
• Targeted term: 10 to 11 years
• Eligibility: Accredited Investors only

Speculative and illiquid. Available only to verified accredited investors. Offers are made solely through the Confidential Private Placement Memorandum. Express interest and a member of our team will reach out with full details. Targeted outcomes are not guaranteed. Read the Private Placement Memorandum in full before investing. Consult your own tax counsel and CPA for tax advice. This is not a recommendation to buy or sell any security.