Series 22: Combination Drilling And Income

Taken from our Series 22 Top-off Online Guide

Combination Drilling and Income

Oil and gas programs may involve a combination of all three types: exploratory, developmental, and production. A combination may allow the investor to achieve the tax deferrals from intangible and tangible drilling costs while a property is being developed and reap the benefits of production.

+ Read More
More Series 22 Info
What are people saying?
Create an Account

Since you're reading about Series 22: Combination Drilling And Income, you might also be interested in:

Solomon Exam Prep Study Materials for the Series 22
Please Enable Javascript
to view this content!

Types of Oil and Gas Programs

Exploratory Programs

Developmental Programs

Income Programs

Characteristics

• Locate properties (usually remote) likely to hold oil and gas

• Cost of land and mineral rights are low; high exploration costs

• Terminate prior to drilling

• Benefits from tax deductions and sale of property rights

• Locate properties near producing oil and gas wells

• Cost of land and mineral rights high; cost of exploration low

• Terminates prior to production phase

• Benefits from tax deductions and sale of property rights

• Purchase existing producing wells

• Cost of land and mineral rights very high; exploration costs negligible

• No specific termination date

• Generates immediate income

Risks

• Finding only “dry holes”

• Changing environmental and other regulatory rules

• Low production from step-out wells

• Changing envi