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Return On Investment
Increased Demand Could Increase Profits
The United States is the top oil-producing country globally, with over 19 million barrels of oil produced every day. However, with ever-increasing international industrialization, global oil demand continues to rise, year after year. As this occurs, the fundamental economic rules of supply and demand take charge.
Investors benefit from this ever-increasing demand by being able to sell all the resources they produce.
Risk vs. Reward Impacts ROI
The most common way to directly invest in developing an oil and gas-producing property is a partnership. Millennium’s energy development ventures aim at producing indispensable resources and capitalizing on solid pricing and a steady, unquenchable market.
Among the riskiest of speculative investments, this higher-risk profile thrives because successful projects can return significant gains. These projects begin producing reserves and cash flow, usually within weeks of completion, and remain profitable for decades. Long-term production statistically leads to returns of 5 or 10 to 1 in many cases.
Tax Benefits of Oil and Gas Investments
One option stands alone above all others regarding tax-advantaged investments for Accredited Investors: oil and gas development.
Federal tax laws intended to spur domestic oil and gas production created substantial tax incentives for investors and small producers. Generally, an investor writes off their entire capitalization in the current year from their Active Income, sometimes referred to as Ordinary Income. This type of income is the most difficult to shield from income taxation.
The Cost Of Doing Nothing
With unforgiving tax brackets, Accredited Investors pay a hefty price by not considering oil and gas investments as a hedge. The tax incentives of energy development allow investors to convert a portion of their tax liability into risk capital with tremendous upside potential.
Monthly Cash Flow
Most oil and gas development properties begin flowing resources shortly after the completion of drilling operations. Depending on production volumes, sales can start immediately and remain active 24/7. This constant sales stream affords developers generous monthly cash flow, often reaching 10% of their investment per month.