Fig Tree Capital Ventures, a venture capital firm, provides direct investment opportunities in the increasingly profitable oil and gas industry. Equipped with extensive experience in the horizontal development of oil and natural gas fields, we leverage years of industry knowledge to provide our partners with high-yield investment opportunities that enable them to diversify their investment portfolios and ensure a consistent cash flow while qualifying for substantial tax benefits. Since 2008, Figtree has consistently been working towards lowering the risks involved in oil and gas projects by partnering with the best operators in the industry. With our track record, transparency with our investor partners, and relationships in the industry we have continued to deliver some of the best energy projects in a way that sets us apart from the rest of the industry.
Why Invest in Oil and Natural Gas?
Oil and gas investments provide accredited investors with an opportunity to diversify their portfolio and generate great monthly cash flows while taking advantage of substantial tax benefits allowed by the United States government. Each investor receives a share in a steady stream of profits generated by the wells they own, also known as Net Revenue Interest (NRI). In worst case scenarios, in the rare case the exploration hits a dry well, investors can recuperate their investment in a 100% total write off in losses. Here is a glimpse of the other benefits of investing in oil and natural gas:
Oil and gas drives global economies, and with no better alternatives in sight, the demand is expected to grow exponentially in the years to come. Global oil consumption in 2010 stood at 87 million barrels per day, which is projected to reach 119 million barrels per day by 2040. Oil and gas investments, therefore, provide investors with the ability to realize long-term and relatively stable returns on their investments in producing wells.
Investment in oil wells is less vulnerable to economic downturns as compared to stocks, and other liquid investments. As mentioned before, the U.S. government also allows substantial tax benefits on these investments, thereby, making them the most favorable option for accredited investors, which is leading to an increasing number of high networth individuals and accredited investors turning to the investment channel.
Intangible Drilling Costs
The tax benefit covers intangible costs including labor, chemicals, water, etc. which constitute for anywhere between 65-80 percent of the drilling cost, but are 100 percent deductible. These tax breaks exclude tangible expenses including the cost of drilling equipment.
Tangible Drilling Cost
Drilling equipment is 100 percent tax deductible and must be distributed over a period of 7 years.
Active vs Passive Income
The American Tax Code does not recognize working interest in oil and gas wells as a “passive” activity, thereby, providing the offsetting of deductions against income from salaries, stocks, and business income.
Small Producer Tax Exemption or “Depletion Allowance”
The tax benefit is available exclusively to small producers and investors and provides a very enticing write off which excludes from taxation 15 percent of total gross income from the production of oil and gas wells.
Lease costs, including expenses incurred while procuring and negotiating the lease and mineral rights, lease operating costs, and all administrative, legal, and accounting expenses are exempt through the depletion allowance and must be deducted over the course of the lease agreement.
Alternative Minimum Tax
The Tax Act 1992 exempts Intangible Drilling Costs as a Tax Preference Item. The Tax Preference Items described under the Code greatly affect the way some of these exemptions are taxed, alternatively. The current US tax code allows substantial tax deductions on excess Intangible Drilling and Development Costs for a taxable year.
Why Choose FIG Tree Capital Ventures?
Figtree owns 22 “producing” wells in North Dakota and 11 wells on which the drilling work is either in progress or near completion. We also provide our partners with direct investment opportunities in 19 wells in Texas, which fall in the Woodbine Formation that has produced 5.42 billion barrels of oil to date, and counting. However, the most promising new lease holds under FIG Tree’s management are located in the STACK and SCOOP plays in the Oklahoma oil fields. These shale formations give us the ability to predict, more accurately, where the best wells are and where to drill more in the future. We have partnered with some of the biggest operators in the industry to develop this oil and gas rich region of Oklahoma and will be a hallmark for FIG Tree’s energy portfolio and its investors.
Over the years, we have entered into strategic collaborations with some of the most reputable names in the industry, including Continental, Newfield, Whiting, Kodiak, and OXY. Our partnerships enable us to strengthen our core competencies and leverage our expertise to uphold superlative results to the industry averages.
Our team of experts comprises seasoned industry professionals possessing extensive market exposure, knowledge, and experience. We apply knowledge to devise best policies and procedures that help us achieve optimum returns for our investors, while setting new industry standards, both in terms of investor fairness and performance.
Since inception, we have undertaken and successfully executed a number of oil and gas projects, including record breaking wells in the Bakken formation in North Dakota and wells in the SCOOP and STACK plays in Oklahoma. By leveraging our in-depth expertise, we are able to predict consistent estimated returns for our investment partners.