Economic gravity in the oil industry_ what goes up comes down – the new york times

Before the advent of fracking, the drilling rights on many pieces of land — including the Permian Basin in West Texas, Marcellus Shale in Pennsylvania and the Bakken Shale in North Dakota — were worthless.

But the same technology that led to booms in these areas, and large lease payments for the people who owned the mineral rights on the land, contributed to the glut of oil worldwide and today’s low prices. Singapore money lender act That, in turn, means less drilling.

“Oil is too easy to get out of the ground and too easy to find,” said Paul Midkiff, national director of the oil, gas and mineral management group at Wells Fargo Private Bank.

Money lender license hk “I truly believe it won’t go back up to $100 a barrel.”

Yet a great reduction in cash flow for leaseholders has given them an opportunity for estate planning, even if the opportunity is not as great as in past busts.

Mr. Hard money lender list Keeshan said his family had set up a family partnership to own its land and mineral holdings. Licensed money lender interest rate These partnerships allow the people setting them up to get discounts on the assets they are putting in, in the belief that family members would struggle to sell shares in the partnership at full value to outsiders.

“The value is up on the land even though we’re not removing any oil,” he said. How to become a private lender with no money “At some point, the commodity will come back to the point where it will be economical to remove it again.”

And that has been a challenge for estate planners. Best money lender in singapore The existence of fracking has reduced the ability of appraisers to justify a greatly discounted price for the land and the mineral rights.

“The drilling success for wildcat drilling was one in 10 wells,” Mr. Money lender singapore review Midkiff said. Licensed money lender tampines “When you’re talking about shale drilling, you’re not going to find dry holes any more. The moneylender and his wife You’re going to find it and frack it out and have success nine out of 10 times. Licensed money lender association That’s changed how we value these things.”

The lower cash flow, though, has scared off some people from estate planning, for fear that if they put the leases into irrevocable trusts, which require them to give up the cash flow, they will not have enough money to live on. Money lender jurong That could be shortsighted.

Allison Elliott, senior wealth planning strategist for Wells Fargo Private Bank, said she worked with a couple in their 50s who were set to do extensive estate planning at the peak of the oil boom. The best money lenders But as oil prices fell, and their lease income with it, they went from wanting to use both estate tax exemptions, which were worth over $10 million, to using one, to not returning her calls.

“By the end of 2015, their net worth was about a third,” she said. Private money lenders interest rates “Their cash flow was also cut back by two-thirds. Money lender law But they’re still well above the estate tax limits.”

Now, she said, they are looking to put $3.5 million worth of leases into trust for their heirs. Singapore money lender license They got to that point by realizing that even if prices stayed low, they would have enough to live on.

“As the money kept rolling in, they started buying things, but they had a safety net first,” she said. Money lender license “That was where we showed them that their safety net was going to work even if they didn’t get more cash flow.”

Dane E. Online money lender reviews Crunk, managing director of Syntal Capital Partners, said that the people in the production and oil service industries best poised to make it through this downturn were the ones with the lowest debt. Licensed money lender singapore interest rate And low debt is usually sensible advice for anyone. Licensed money lender review But that was more difficult to do in this boom, where production companies asked servicing firms to quickly add employees and equipment, he said.

“Even some of our more savvy service business owners were forced to take on more debt and grow more quickly than they would have done,” he said. Money lender license singapore “It’s a really sore subject right now, this idea of partnership.”

For oil and gas executives, the drop has been a mixed bag. Money lender interest rates in singapore Jonathan A. Licensed money lender singapore forum Blumenthal, managing director at United Capital in Dallas, said he had clients who retired after working 35 years at companies like Exxon Mobil and their retirement packages were good. Money lender ordinance He said that because interest rates were so low, the sizes of lump sum pension payouts were as high as they had ever been.

But executives at other oil companies like Chevron and BP, which have not been doing as well and are laying off people before they have fully funded their pensions, may find themselves struggling.

For people who thought, seemingly rationally, that they could retire early and the lease income would replace their salaries, the shock has been mighty. Licensed money lender in singapore In some cases, given their careers in the oil industry, these retirees had other money invested in oil producers and pipeline companies that have lost value.

Mr. Money lender meaning in urdu Blumenthal said the clients who managed the decline in oil prices best were the ones who could imagine other sectors, like rental real estate, where the cash flow dried up when those properties were no longer rented.

“You have to show them what it looks like if they don’t have that income,” he said. Another word for money lender “Our process is to show you how the decisions in your life impact the process. Money lender interest rates You have to make decisions based on the things you can control.”

“We never expected to receive this,” Mrs. What is a private money lender Keeshan said. Money lender miri sarawak “Even when things are bad, we’re blessed. Singapore licensed money lender We’ve always had good jobs. Money mutual lenders list We were lucky we had a family member who left this to my mother and my aunt. Singapore money lender We never get ahead of ourselves.”

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