How to Raise Capital for Oil and Gas Programs
Investor profiles, education topics, compliance guardrails and campaign timing for oil and gas sponsors raising from accredited investors.
Read →Short answer
Oil and gas sponsors can market education freely and, under Rule 506(c), the offering itself, but claims must be balanced and consistent with offering documents. Describe tax features as features of the tax code rather than promised savings, avoid production or price predictions in public marketing, disclose risks prominently, and route every investor-facing asset through counsel.
Key takeaways
- Education is safe ground; offering-specific ads need the right exemption.
- Tax features, not tax promises.
- No production, price or return guarantees.
- Keep a written review log for every asset.
Generally fine (with counsel review)
- Explaining working vs royalty interests, IDCs and depletion in general terms.
- Sharing your operating approach, team and reporting.
- Publishing EIA or other third-party market data with sources.
- Under 506(c): promoting the specific program with balanced risk disclosure.
Avoid
- "Guaranteed" deductions, production or returns.
- Specific tax-savings figures in public ads.
- Price forecasts presented as fact.
- Testimonials implying typical results, without counsel review.
- Cold-pitching a 506(b) program to strangers.
A simple review workflow
- Marketing drafts the asset with sources for every number.
- Compliance or counsel reviews claims and risk language.
- Approved version is logged with date and approver.
- Assets are re-reviewed when prices, programs or rules change.
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Frequently asked questions
You can describe how tax provisions work in general terms, but avoid promising specific savings. Tell investors to consult their CPA and have counsel review the language.
You can cite third-party forecasts with sources and dates, but don't present them as predictions of your program's returns.
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Sources
This article is for educational purposes only and does not constitute legal, tax, securities or investment advice, or an offer to sell or a solicitation of an offer to buy any security. Consult qualified securities counsel about your specific offering.
