Rewards for New Reserves

The oil & gas industry of late has been in hibernation. The pandemic, low product prices and lack of available capital have materially reduced efforts to establish new reserves and to maintain existing production. Cancellation of the XL pipeline by the Biden administration and the effort by the Governor of Michigan to close the Line 5 pipeline are two actions that will, along with other comparable impediments, move the United States from energy independence to dependence on other countries yet again. These current actions may be indicators of why new investment in oil & gas may be prudent. The laws of supply and demand do not change in response to political narratives. Reduced supply of hydrocarbons will result in higher product prices (this is already being reported in the news). Since there is a time lag between higher prices and renewed supply, the time to develop new supplies is now. Efforts to increase production and to develop new reserves undertaken in the present will yield premium rewards to those who are willing to act now, to take the risk. The economy is rapidly improving. Increased demand for energy will not lag far behind, and when it arrives, any shortfall of supply will reward those who have developed new reserves. We have seen this before quite often. This Firm stands ready to assist those who seek to put together transactions for the enhancement of currently producing properties or the development of new reserves.