[Eric 951]

A few indicators to look at regarding the possible investment.

1. Where is the well--state and oil field? How deep is the well?
2. Who operates the well and who is the current buyer of the oil? Is the current buyer locked in to a long-term purchase contract?
3. Are you responsible and for what percentage of maintenance/repair/operating expenses on the well?
4. If yes to above, what are the current operating annual operating costs.
5. Is the investment just for the single well, or a portion of the overall play(total acreage where the well is currently) are you buying into any type of future consideration if other wells are developed in that play?
6. Is well pumping at current maximum capacity(doubtful), what was the peak production rate, what is average monthly production rate?
7. What is the water cut of the current BO--are you responsible for any of the processing fees for the oil to be market ready? Are you responsible for water disposal after separation(Usually into an injection well which will have a per barrel expense.)?
8. What are similar wells producing in the area and expected reserves in that particular field where well is located?
9. Is it a traditional vertical shaft well or is it a fracked well with multiple horizontals?
10. How does the lease read where the well currently sits? Does the land owner get a percentage? how much?
Wells can be a gamble--it can produce for less than a year, 10-15 years, or 50+ years--usually at a diminished return over the life of the well.