It has been a difficult two years for bankers and energy manufacturers across the globe, but the industry has rebounded dramatically over the past fiscal year with record production numbers that have not been seen since the oil and gas boom of the early eighties. With the surge of dormant energy service companies on the rise, the time to invest in energy is evident more than ever before.
Erick Moore, Managing Principal of the Private Equity, Venture capital firm of EM Capital Management, LLC, agrees with that current assessment.
“Catastrophic losses in the energy industry caused by the pandemic concerns have opened the door for investors to re-coup what was lost when the pandemic hit investors globally”. Moore says.
Moore believes if investment banks were positioned right prior to the pandemic, they should be fairing favorably now with the current energy spikes were seeing.
Now with the diversification of energy resources globally, it has not decreased the demand for oil & gas.
Moore added, that a lot of his constituents believe oil & gas consumption (Which has seen a continuous increase since 2006), will continue to flourish, because of the world population growth and rising lifestyles. He also stated that the world will always have a need for oil due to plastics (made from petroleum) and heavy equipment that require diesel fuel to run.
Moore also noted, after attending a recent Petroleum conference that investors are motivated by the great tax incentives oil & gas investments offer in this climate, from equipment & Labor being (tax-deductible), as well as the potential energy investment being an excellent write-off against income or gains in other areas.
Investing in oil & gas seems to be the new wave for investing in one's future at this time. Whether through direct participation (DPP), which by moat bankers is the most profitable way to participate in oil & gas, or potential investors investing in mineral right leases, which function like a private lending agreement, (Investors would receive contractually agreed upon returns that would provide monthly disbursements).
But Moore believes whichever way individuals or investors want to invest, the time is now. Moore added that his firm has been active in acquiring mineral/royalty interest in West Texas, Louisiana, and most active domestic basins. Also with the spike in service needs, their firm has been extremely active in injecting capital to energy management companies that purchase land and develop oil & gas revenue streams, as well as merging with services companies in the energy sector that were ravaged by the aftermath of the global pandemic.
Moore also added, “We have been through the turmoil of the oil & gas downfalls before. But what has been different for us is that we here at “EM Cap” were well insulated and prepared to weather any unforeseen circumstance that may have come our way”.
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