FIG Tree Capital Ventures is a privately held venture capital firm located in McKinney Texas. FIG Tree’s team of expert industry professionals specialize in helping sophisticated accredited investors identify, evaluate, and acquire, direct participation investments in Energy, Real Estate, and Technology with the goal being to generate the potential for long term monthly cash flow, tax benefits, and asset appreciation.
FIG Tree first opened its doors in the Fall of 2008.
An accredited investor, in the context of a natural person, includes anyone who:
- earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year, OR
- has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence).
On the income test, the person must satisfy the thresholds for the three years consistently either alone or with a spouse, and cannot, for example, satisfy one year based on individual income and the next two years based on joint income with a spouse. The only exception is if a person is married within this period, in which case the person may satisfy the threshold on the basis of joint income for the years during which the person was married and on the basis of individual income for the other years.
In addition, entities such as banks, partnerships, corporations, nonprofits and trusts may be accredited investors. Of the entities that would be considered accredited investors and depending on your circumstances, the following may be relevant to you:
- any trust, with total assets in excess of $5 million, not formed to specifically purchase the subject securities, whose purchase is directed by a sophisticated person, or
- any entity in which all of the equity owners are accredited investors.
In this context, a sophisticated person means the person must have, or the company or private fund offering the securities reasonably believes that this person has, sufficient knowledge and experience in financial and business matters to evaluate the merits and risks of the prospective investment.
FIG Tree also requires the subscriber to submit documentation in order to verify the prospective investors accreditation. Documentation could include but is not limited to; a letter from your CPA or Advisor, W2’s, 1099’s, Brokerage Statements, Bank Statements, or property deeds and appraisals.
FIG Tree’s projects are designed to achieve one or more of the following goals. The Potential for investors to receive long term monthly cash flow, asset appreciation, and significant tax deductions (oil and gas only).
As any astute investor knows, all types of investments carry some degree of risk, and the same is true at FIG Tree. We offer many different projects with varying levels of risk. For example, oil and gas general partnerships are considered considerably riskier than a passive real estate fund. As a result, each prospective accredited investor who is interested in evaluating one of FIG Tree’s projects will receive a full private placement memorandum that includes a full risk disclosure for the specific project.
The typical amount to purchase a 1-unit investment in one of FIG Tree’s projects is $100,000.00 with a minimum subscription of $25,000.00.
At FIG Tree, we insure the continuity of our business relationships with integrity, honesty, and most importantly transparency. Our accessibility results in an optimum customer service experience unmatched anywhere else in the industry. We strongly believe our unique product structures have set the bar for investor fairness therefore creating the highest standard for direct investments.
Oil and Gas FAQ
We offer the opportunity for investors to invest directly into some of the most sought-after drilling locations in the country as non-operating partners alongside premier publicly traded and large independent operators. In addition, we offer investors the opportunity to invest into the services side of oil and gas via salt water disposal facilities.
Partners in successful drilling projects have the potential to generate substantial long term monthly cash flow and significant tax deductions.
Revenue on successful projects is paid monthly via check or direct deposit.
Intangible Drilling and Completion Costs.
When an oil or gas well is drilled and completed, there are numerous expenses may be deducted. These IDC and ICC expenses are deductible due to the fact that they represent nonrecoverable costs in the event the well is determined to be a dry hole. Examples of these types of expenses would be equipment rentals (rigs, generators, mud pumps, and frack tanks), fuel, drilling and completion fluids, frack proppant, and labor. IDC’s and ICC’s can represent up to 65% to 85% of the overall well cost and are generally deductible in the year the investment was made. [See Section 263 of the US Tax Code]
Tangible drilling and completion costs.
The TDC costs represent expenses for items that have some recoverable salvage value, such as well heads, pumping equipment, well casing, tank batteries, separators, and any other equipment on the surface with value. These items are usually deducted through depreciation using the Modified Accelerated Cost Recovery System or MACRS.
The percentage depletion deduction is a form of depreciation for mineral resources that allows for a deduction from taxable income to reflect the decline in reserves over time. The two types of depletion allowances are cost depletion and percentage depletion. Cost depletion is determined by dividing the amount of reserves produced in a given tax year by the total estimated remaining reserves in order to find the percentage used to calculate the deduction. Percentage depletion is taken by applying a 15% reduction of the taxable gross revenue of a well.
Our Primary focus is the prolific Oklahoma STACK and SCOOP.
The nomenclature for the STACK and SCOOP plays was derived from geographical, opposed to geological, acronyms. The STACK Play stands for “Sooner Trend (oil field, Anadarko (basin), Canadian and Kingfisher (counties).” The SCOOP play stands for “south-central Oklahoma oil province.” Another notable Oklahoma shale play that is often associated with the STACK and SCOOP plays is the SoHot Play. This play, too, is a geographic-based acronym standing for “Southern Oklahoma Hoxbar Oil Trend. While all of these Oklahoma shale plays share characteristics and collectively represent a large percentage of Oklahoma’s future oil and gas production we want to highlight the STACK play and its potential exclusively.
As mentioned, the STACK Play is an area of southeastern Oklahoma that includes oil and gas-rich shale formations such as the proven Meramac and Woodford Shale. These shale formations range in depth from 8,000 to 11,000 feet. The STACK Play is continuing to emerge and gain more prominence despite already being one of the more notable Oklahoma shale plays.
Although the South Central Oklahoma Oil Province (SCOOP) – an extension of the liquids-rich Cana Woodford shale play – remains in its infancy, the area is yielding impressive results from early wells. The Woodford shale play within the Big 4 formation has emerged as a major horizontal play in the SCOOP during the past four years. The prolific oil targets in South Central Oklahoma will continue to see “strong industry development” in the horizontal Woodford play as well as the Bromides, Big 4, Springer and Deese horizons ranging in depth from 8,000 to 16,000 feet.
The SCOOP stretches south in a 100-mile fairway from the Cana Woodford to the valley of the Red River, which separates Texas and Oklahoma. The fairway includes three of the top oil-producing counties in Oklahoma, which have combined to yield 3.2 billion barrels of oil from 60 reservoirs during the past 100 years.
Bounded on the north by the Nemaha Uplift; on the south by the Wichita Uplift; and on the east by the Arbuckle Uplift, the siliceous Woodford shale known as SCOOP is as much as 15,000 feet deep and up to 400 feet thick. What’s more, the SCOOP is surrounded by four prolific, giant oil fields – Sho-Vel-Tum, 1,700 million barrels of oil equivalent (MMBoe); Golden Trend, 1,020 MMBoe; Oklahoma City, 950 MMBoe; and Cement, 420 MMBoe.
The western half of Oklahoma lies on top of the Anadarko Basin, a huge sedimentary formation that has already yielded most of Oklahoma’s conventional oil and natural gas. In 2012, attention turned to the possibility of unlocking the basin’s unconventional resources using the same horizontal drilling and hydraulic-fracturing techniques that have prized millions of barrels of oil and condensates from the Bakken in North Dakota and the Eagle Ford in South Texas. As a result, Woodford horizontal activity shifted to Grady and Garvin counties, and the most active operators in the area included Continental, Newfield, Marathon and Eagle Rock
In a word, potential. In July, one the partnerships operators, Devon Energy Corp, reported it has encountered more success with its spacing pilot program in its STACK [Sooner Trend Anadarko Basin Canadian and Kingfisher Counties] play in Oklahoma.
The Alma spacing pilot tested five wells per section across a single interval in the upper Meramec, delivering 30-day production rates averaging 1,400 barrels of oil equivalent per day (boepd) per well. Sixty percent of this production was light oil, the Oklahoma City-based company reported in a July 18 press release. Early flowback results from the pilot indicate minimal interference between wells, suggesting potential for tighter spacing in the over-pressured oil window. The wells were drilled with 5,000-foot laterals and brought online with a 12/64-inch choke, then gradually increased to a 20/64-inch choke.
During the rest of 2016, the company will participate in several additional spacing pilots to determine to optimal approach to developing stacked-pay intervals in the Meramec, Devon said in the release.
Devon also recently brought online the Pony Express 27-1H well in the over-pressured oil window in southwest Kingfisher County, Oklahoma. The company drilled the well with a 5,000-foot lateral achieved a 30-day average rate of 2,100 boepd – including 1,500 barrels per day of oil. Devon said the well’s oil productivity is the highest of any Meramec well drilled so far in the play on a lateral foot basis.
Seeking potential growth opportunities, operators such as Marathon Oil Corp. are seeking to acquire acreage in Oklahoma’s high margin STACK basin. Recently, Marathon acquired PayRock Energy Holdings LLC for $888 million. In late 2015, Devon acquired assets in the Anadarko Basin from Felix Energy LLC for $1.9 billion to expand its STACK holdings, even as it looked to sell assets across four major shale basins to raise cash and cut debt.
The STACK play is one of the great emerging onshore North America plays, Devon Energy Corp President and CEO Dave Hager told attendees June 29 at the JP Morgan Inaugural Energy Equity Conference. The company holds 430,000 net acres in the STACK play, located mainly in Canadian, Kingfisher and Blaine counties in Oklahoma. Hager said Devon has increased its STACK production significantly, achieving first quarter net production from the STACK play of approximately 91,000 boed.
Plenty of areas in the STACK play offer returns well in excess of cost per capital, but Hager sees the Woodford and Meramec plays as the economic heart of STACK. The company has identified 5,300 gross risked drilling locations in both formations.
Continental Resources Inc. – the largest leaseholder in what used to be the nation’s premier oil play, the Bakken – called the Woodford shale “one of the thickest, best-quality resource shale reservoirs in the country.” During an analyst presentation, the Oklahoma City-based producer revealed that it had blocked up 197,000 net acres in what it dubbed the SCOOP that Continental considered prospective for liquids.
According to Richard Lane, the president and CEO of Vitruvian Exploration II, “What really got us interested in the SCOOP area was the excellent reservoir rock,” Lane said. “Our team described it as the best unconventional reservoir rock that we’ve come across. That’s after looking at a lot of plays in a lot of different basins.
“It’s got the right kerogen type. It’s got great organic carbon. It has good maturity indexes. It has the condensate to go with it and the NGLs,” Lane continued, later adding the average estimated ultimate recoveries are greater than 2 MMboe. “The thickness is excellent, high porosities, good permeability, fairly silica-rich rock. All of that gives rise to a tremendous resource with about 150 to 200 Bcf per section.”
With 38,000 acres in the SCOOP area, Vitruvian estimates its reserve potential at 558 MMboe.
“The SCOOP area is just an outstanding reservoir. It’s much thicker, exceeds 400 feet in the area of our leasehold, it’s about 2,500 feet deeper. That affects the maturity. It affects the pressure and the energy that the reservoir has,” Lane said. “The IPs that we are seeing in the south part in the Scoop area are almost twice as in the Cana [Woodford] proper area. The EURs are significantly higher as well. The gas is richer, and that gives rise to the condensate and the NGLs. So overall, it’s a pretty outstanding reservoir.”
Real Estate FAQ
We offer the opportunity for investors to participate in the currently cash flowing FIG Real Estate Acquisition Fund, which is a 20-million-dollar project focused on the creation of income and asset appreciation via residential rentals, rehabbed flips, and owner financed properties.
There are several key reasons why our approach is attractive to investors. First, FIG Tree’s real estate team has the expertise to handle the complete process of acquiring “off the market” properties at wholesale prices and performing the rehab necessary to get the property ready for tenants or for a sale. This process maximizes returns by keeping down the cost basis. Second, investing in residential real estate on your own requires a significant time commitment that most busy professional can’t fulfill. In addition, inexperienced real estate investors often go through a learning curve that can lead to costly mistakes. Third, when you invest on your own, you shoulder 100% of the expense which can limit the amount of properties you have and therefore increase risk. Or existing fund allows to you participate with a group of likeminded investors in an existing property portfolio therefore increasing your ability to diversify and decrease risk.
Revenue on the FIG Real Estate Acquisition Fund is distributed monthly.
Partners are required to stay in the fund for 2 years after which time partners can request to enter the withdrawal que. The fund can accommodate a maximum investor withdrawal up to 20% of its total value each calendar year on a first come first serve basis assuming the fund has the liquidity to do so.
The fund operates on a 100% cash basis and uses zero financing.