From the desk of Troy Eckard…
“Let’s be candid. When it comes to investing, higher returns usually mean higher risks. Oil and gas is nearly 100% in alignment with this statement. If you want to drill a horizontal shale well, it will be costly, but it will almost never be a dry hole, and it will payout over time.
I’ve always perceived that there are two major risks in oil and gas. Either your risk is that of the notorious swinging of the pendulum or the unpredictable power of Mother Nature. In my experience, the pendulum is more brutal, more unreliable and more ruthless than Mother Nature. However, Mother Nature is and always will be unpredictable. Extreme weather, managing wellbore pressure, and temperature changes all affect an oil rig. Investors need to understand the varying factors that can affect a rig at any given moment.
While it does contain risks, drilling for oil and gas can be very rewarding. It can be a part of an investor’s portfolio early on and continue providing returns until they stop investing later in life. The key is to define and control the areas of risk such as contractual, ethical, asset class, geography, capital exposure, management, long-term liability and exiting the investment.
Without a good manager that offers a lot of expertise, exposure to hundreds of occurrences, and cross trained in numerous fields of expertise, an investor is at a level of risk that probably cannot be measured.
Drilling wells is a risky investment and loss of capital is real. I am okay with that downside and risk. It can be and is measured each time our company, Eckard Global (EG), decides to accept a new proposal. Investors need to seek a manager with years of experience and battle scars to prove their knowledge of the risks in this field.
This is your investment, and you need to be sure you have a major league player on your side, watching, leading and protecting your money while calculating the risks involved.”