01/31/2024
CASH FLOW is KING!
As far as investments go, real estate is the best long game in the world! What most people don't know is there are thousands of commercial Salt Water Disposal (SWD) wells across multiple states that generate significant cash flow. Some of these properties have long term contracts and acreage or wellbore dedication agreements with major E&P companies like Pioneer, XTO, EOG, Marathon, Matador, etc. They receive waste water via tanker truck (vacuum truck) or pipeline direct from the producing oil/gas wells. For those of you who don't know what an SWD is or how they make money, a commercial disposal well is permitted by the State or EPA to receive, treat, filter and dispose of waste water generated by oil and gas drilling, completion and production operations. They make money by charging the oil company ~$0.50 per barrel received. The water also contains a small percentage of oil which can be recovered and sold further increasing revenues. A typical SWD is permitted to receive up to 25,000 barrels per day. To give you and idea of just how large the water sector of the oil and gas industry is, for every barrel of oil produced, approximately 4-10 barrels of water will be produced as well. As far as economics go, a SWD that's generating $2MM per year in cash flow would sell for approximately $8MM. Many of these properties are within Qualified Opportunity Zones (QOZ). Contact us for more information!
