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RJ Burr, is a third generation producer of American oil. Born into the industry, Mr. Burr was at his first location before he could walk and has been fascinated by the production of oil his entire life. Within 3 months of graduating high school, RJ funded his first partnership and never looked back.
RJ is the Sr. VP Corporate Operations at Panex. With a main focus on the Gulf Coast, Mr. Burr’s companies have raised and deployed over $300 million in upstream development and have partnered with some of the largest oil and gas companies, namely Shell, BP, and Marathon, to develop several million barrels in reserves.
In this episode, RJ Burr shares how oil is a necessary component of our society and must be preserved for future generations. He also covers how drilling programs provide significant tax benefits while providing access to key raw materials, making them an attractive investment opportunity!
Oil is an integral part of our society and will be for the foreseeable future. “When you restrict a country’s energy, you restrict their growth” RJ shares, emphasizing the importance of oil & gas production and the benefits of investing in a drilling program.
Don’t miss out on this great episode with RJ Burr to discover more about the current situation on oil and gas and its fundamentals.
In This Episode
- How it all started for RJ Burr.
- The history of the oil and gas industry and where it is today.
- How RJ articulates the current supply and demand imbalancement.
- Where does RJ foresee oil and gas prices heading?
- Single biggest recommendation to get into the oil and gas industry.
Hey everyone, welcome to today’s show on Wealth Strategy Secrets. Today, we’re joined by RJ Burr.
RJ is a third-generation producer of American oil, born into the industry. He was on his first location before he could walk and has been fascinated by the production of oil his entire life. Within three months of graduating high school, Mr. Burr funded his first partnership and never looked back.
RJ is the Senior VP of Corporate Operations at Panax, with a main focus on the Gulf Coast. Mr. Burr’s companies have raised and deployed over $300 million in upstream development and have partnered with some of the largest oil and gas companies—namely Shell, BP, and Marathon—to develop several million barrels in reserves.
RJ, welcome to the show!
Good morning, how are you doing today?
I’m doing great, thanks. Great to have you on the show.
Oh man, it’s—what else would we be doing? I mean, if it wasn’t fun, they’d call it work.
Exactly, that is the key right there—having fun and making a difference in what you’re doing.
You talk to your kids, and you tell them to follow what you love. I hope you find some type of career where it’s something you can—because a lot of times, when you’re looking for something fun, a habit finds you. A habit or something that you can make money doing; otherwise, you’re essentially just killing time.
Very true. So, RJ, why don’t we kick things off a little bit? For folks who aren’t familiar with your background and everything, tell us a little bit about your journey. How did you get into the oil space? Clearly, you started at a very young age, so there must have been some influence there from your family. How did it all start for you?
Well, it starts in Maryville, Louisiana—a town about the size of an acorn. That is where my mom and dad are from. When they got married and, I believe, had my second oldest sister—I have three older sisters—by the time my second sister was born, my dad’s grandpa passed away.
When he was on his deathbed, my dad walked in to see him. This was somebody my dad had a tremendous amount of respect for. Papa Burr looked at him and said, “Bob, when you leave this room, I want you to walk down to the end of the road—just an old dirt road—and back. It’s about two miles. I want you to look around. When you get done, go get that wife and those baby girls and head for the lights. This town holds nothing for me.”
What he was telling my dad was that if Dad stayed there, he would live the same life—not a bad life—but the same as everybody else who had been in Maryville their whole lives. He knew my dad had something most people didn’t—he had a spark. That was when my dad started his venture. He moved to South Texas from Louisiana, got in the insurance business, and became a tremendous salesman.
I believe the good Lord gives everybody one or two talents. It’s your job to find what those talents are, and one of the talents He gave my dad was the ability to sell. Dad started out in insurance, and when he was 27 years old, his brother gave him a call. He said, “Bob, I’m up in Dallas. I’ve got a gig, and I think you’d be good at it. Why don’t you come up and see what we’re doing?”
So, my dad drove up there. My uncle had gotten into the oil and gas business and was funding a well. My dad sat there, listening to the guys talk on the phone and how they were presenting. It took him about an hour. He looked at Uncle Gene and said, “Gene, give me some leads. Let me see.” He grabbed the phone, got on a call, and by the end of the day, he knew, I can do this.
He called my mom and said, “Pack it up; we’re moving to Dallas.” That’s how we got into the oil business. I was one year old at the time, and this is all I’ve ever known. Some kids grow up watching their dads practice law or medicine, teach, or work other jobs. I got to watch my dad in oil and gas.
When you look at the industry—well, I love history. History is The Greatest Story Ever Told. There’s a reason second-generation family businesses or third-generation family businesses succeed. That second and third generation—they know things inherently because they’ve been around it their whole lives. These are things you can’t learn in a classroom.
That’s how you build major corporations or companies that last years—because you have generations of families who’ve learned from the past. Let’s just say they’ve touched that stove for us, so we know it’s hot, and we don’t have to touch it.
That’s basically how I got into the oil and gas business. I knew what I wanted to do. I graduated high school, started funding programs, and have never looked back.
Yeah, that’s really interesting, and I think it’s very unique, right? A lot of times, people are in family businesses and might have some exposure there, but to see that for multiple generations is very unique. Like you say, it definitely adds something—it says something about the industry.
Speaking of industry and history, you know, you talked about history being really the greatest teller of information and a source for folks. We have a lot of listeners who are really new to the oil and gas space and may not necessarily be familiar with its history.
I think there’s also a checkered history, right, in oil and gas? There have been some different things that have gone on. So, can you tell us a little bit about the history of the industry and where it is today?
Well, I mean, you made a great point, and it goes with pretty much any industry. Where there are wealth-creating factors, like there are in oil and gas, you’re going to have some snakes get into that industry. The dream—the prize, the brass ring—is changing your financial future. How many industries can take one dollar and turn it into 100 overnight?
That’s what oil and gas can do. I believe what everybody is coming out from under is the illusion right now. You know, I love movies. One of my favorite movies is The Usual Suspects, and one of my favorite quotes from it is: “The greatest trick the devil ever pulled was convincing the world he didn’t exist.” How I look at oil and gas, I kind of want to modify that quote a little bit and point it toward the green energy movement: “The greatest trick the green energy movement ever pulled was convincing the world that oil was bad.”
Because we’re all dependent on it. It doesn’t matter where you are, it doesn’t matter who you are—if you live in the modern world, you’re in the oil business. We all consume it. As much as I want a clean environment and beautiful, pristine landscapes—and I believe everybody has a little environmentalist in them—what we want and desire doesn’t match what is. And what is is that there is nothing on the market that can replace oil.
So, you go back and look at the history of oil, and really, I believe we’re in the third generation of the evolution of oil. The first was in the beginning: you had the Seven Sisters—your seven major companies. They basically controlled the oil market. They manipulated prices, for good and for bad, for the government and for themselves. It’s all out there. Anybody who wants to see it can easily research and dig it up—it’s well documented.
Well, in 1960, they changed the entire landscape. That was the second life of the oil industry when OPEC was created. The reason OPEC was created was to counter the Seven Sisters’ power. For the last roughly 60 years, that has been the power structure in the oil industry worldwide.
Now, what happened—whether you like President Trump or not—is really irrelevant, because what happened with the explosion of the U.S. shale industry is that, all of a sudden, it took some of OPEC’s power. All of a sudden, they didn’t have the same say in determining prices. They wanted that power back, and that’s where everything was sitting about four years ago.
When you think about the industry, here’s another great trick they’ve been able to pull and convince everybody of. If you walk out into the street and grab the average American and ask them, “Name one oil company—name one American oil company,” everybody goes to Exxon. Everybody goes to one of the majors.
The problem is, that’s not the domestic oil and gas industry. Ninety percent of your gas and roughly 83% of your oil is produced by about 9,000 independent oil and gas producers. Those oil and gas producers average 12 employees or fewer. That’s your oil and gas industry. That’s who produces America’s oil.
I’m not saying Exxon or the other majors don’t produce oil in the U.S., but it’s not the top of their priority list. So, when you look at everything that’s happened over the last couple of years, most people’s perception is, “Oh, well, the oil industry is getting hurt. Well, heck, it’s Exxon, BP, Shell—they’re massive, they can handle that hit.”
But that’s not who was really getting hit. It was the mom-and-pops—the independent producers that were getting hit during all this.
This actually walks perfectly back to what we were talking about earlier when I mentioned generational businesses. When you’ve been in this business as long as my family has, you see things happening in the market and can anticipate where it’s going to go because you’ve seen it before.
That’s exactly what we did. We saw Russia and Saudi Arabia increasing production. We know the numbers. Over the last 20 years, worldwide oil prices have averaged roughly $60. Most of your independent producing oil companies in the U.S. were created during that time. They’ve built their world around $60 oil—they probably need $50 to $55 to pay their bills and make their profit on the last $5.
Knowing that, we figured Saudi Arabia and Russia would flood the market and push the prices down. If you need $50 to $55 per barrel to pay your bills and all of a sudden prices are $40, does that put you in a bad position? Absolutely.
That’s what we saw coming. We started gearing up to make acquisitions because we knew companies were going to be in the crosshairs. But then something happened that nobody expected: COVID-19. The pandemic compressed what we thought would take 12 to 18 months into 30 days.
Suddenly, companies were falling off left and right. I remember looking at oil prices on April 20th. I watched them drop, and when it got to about $15 a barrel, I’d had enough. I left, drove down the road to Arby’s, grabbed a roast beef sandwich, and came back to my office. I was gone maybe 15 minutes.
When I got back, I looked up at the TV and saw $40. I thought, “Oh, good, it corrected.” But when I sat down at my desk, it dawned on me—there was a little minus sign in front of that $40.
That moment is burned into my memory. I know exactly where I was, what I was doing, and what was on my desk. I’ve been in this business my whole life and had never seen negative oil.
At that point, we said, “Hey, everyone’s pulling in their sails and battening down their hatches for the storm. Why don’t we spread our sails out?” This is what we anticipated, just with a different trigger causing it.
In the last two years, we’ve acquired what looks to be 100 million barrels of oil in reserve. Now, we just need to develop it. We know it’s there—we just need to drill it and get it out of the ground.
That’s the beauty of the position we’re in. This isn’t our first rodeo. We’ve been here, done this, and have partners who know that oil and gas offers tremendous tax benefits for a reason. Uncle Sam doesn’t do anything for free. Without oil, the economy struggles.
So, we put our partners in a position where they don’t just see money going out—they see money coming back. That’s exactly what we’re doing: putting them in a monumental position to take advantage of an opportunity most people never have.
There’s a reason J.R. Ewing had big ol’ longhorns on the front of his limo.
Right, so do you think that many of these independent producers in oil, right after the pandemic hit, were knocked out? Are we now in this phase where there’s a huge supply-demand imbalance?
Prices are going up, and you’ve got these geopolitical factors at play—things like the green initiative driving prices even higher.
Is that what’s creating the opportunity right now? Or how would you articulate the opportunity based on the various dynamics going on in this market?
Well, one, you have to—what’s the best way to put this—you have to have faith in what you see happening and how it’s going to play out. Here’s what I mean: looking at the current world environment, looking at green energy, looking at alternative energy sources, looking at renewables, and just every other potential source of energy we could have, knowing human nature, if you had invented the greatest thing since sliced bread—which is what I think it’s going to take, a printing press-type invention to replace oil—don’t you think somebody would have said something about it? Don’t you think somebody would have mentioned it?
Actually, that’s a great lead-in because you could go to our website, panx.us/learn. We have Oil and Gas 101, Oil and Gas 102, and Oil and Gas 103.
- Oil and Gas 101 gives you the history of oil—why we started drilling it, what its uses are for. It gives a big broad picture of the oil and gas industry, how you drill wells, and what you’re looking for. It’s the best foundation for somebody wanting to learn the industry.
- Oil and Gas 102 is about the tax benefits and how they can help you and your family.
- Oil and Gas 103 delves into this topic because when you look at it, don’t listen to what they say—watch what they do.
Take the major oil companies. When you look at investment in downstream oil and gas, or when you look at investment in developing wells in 2013—now, let me check my numbers, I don’t want to quote something off—but basically, in the last eight years, we’ve had about a 70% drop in funds invested to replace produced oil and exploration funds worldwide.
You go in and look at where that money went. If Exxon’s not putting this money in and we’re producing more oil, where are they putting this money? Well, they’re putting it in solar panels. The first solar panel was discovered in the mid-1800s. If they hadn’t perfected the solar panel by now, chances are they’re not going to any day soon. They’re putting it in hydropower and windmills. Windmills are several hundred years old. This is not something they’re just trying to learn how to do—they’ve been working on it for years.
When you look at all these majors putting this money into alternative energy, why would they do that? Once again, not guessing on their motivations, there could really only be one of two reasons.
One, they’re altruistic. They believe the product their company is producing is destroying the world, and they feel they need to invest in alternative sources to save the damage they’ve done, regardless of their partners or clients who own the stock in the company. That could be one reason.
Or, two, they see exactly what I see. They see that oil is really irreplaceable. If you have a million barrels in reserve, and you stop developing more and put your money in something that can’t replace that, then years later, when you realize, “Oh my God, we were wrong,” how much more valuable is that million barrels of oil you already have?
I had a partner here about a year and a half ago call and ask me about green energy. At that point, I knew a little on the surface—it’s my business—so I knew a bit about it, but I’d never done a real deep dive into it. I’d never really researched to see what the best technology out there was or if there was really a threat to oil. After I got through, I was shocked.
Here’s this old redneck from Kentucky sitting down on his computer, digging through all this information, pulling it all out. If I know it here in Bowling Green, Kentucky, I guarantee you they know it too.
When you look at Exxon and worldwide investment in developing more oil and replacing the oil that’s already been produced, it’s down roughly 70% since 2014. Where is that money going? If they’re not reinvesting to find more oil, where is it being invested? When you start digging into it, you see it’s going into green energy.
I know there’s no replacement for oil. They know there’s no replacement for oil. Why would they invest in something they know is fruitless to replace oil? Maybe they have some new technology. Maybe they have something we haven’t heard of that’s under the radar. But when you look at it, no—they’re putting their money in solar panels.
The first solar panel was discovered in the mid-1800s. If they hadn’t perfected it in the last 150 years, I don’t think they’re going to anytime soon. The other place they’re putting money is windmills. Well, the same thing can be said for windmills. Hydropower—they’re putting all their money into this area they’ve been researching for years already. It’s not something new.
Now, you think, why would they do that? Once again, I don’t want to assign motives. I don’t know why. But I can look at it and say, okay, there’s really only one of two reasons they’d be doing this.
One, they’re altruistic. They see their product is destroying the planet and want to invest in something to fix the damage they’ve done, regardless of how it affects their stockholders. That could be one reason.
Or, two, they see the exact same thing I see. They can benefit two ways by putting money in green energy. One, they’ll get the social credit, the “Oh my God, look at these guys, they’re the world’s saviors” kind of thing. They’ll get that social love.
Two, there’s an economic motive. When they put all this money in green energy, and eventually everybody realizes it’s not going to work, how much more valuable is the oil they already have in reserves? What happens to its value when it’s known that they need it ten times more than they originally thought?
When I look at motives, I really don’t care why they did something. I look at what the results will be. One of two things—they’re either willing to destroy their company, or they’re making a play, knowing what I know, that their oil will be worth two, three, or four times what it’s worth right now without producing more.
You look at the dynamic they’ve set up, and I know this: everyone being in the oil business, as long as you have oil—look at everything going on in the world right now. Look at all the industries that are hurting. Do you want to know why we’re not hurting? Do you want to know why my partners are tickled pink?
Because we’re able to turn the economic world’s lemons into lemonade. We have an asset that everybody needs. If these guys keep doing what they’re doing, you’re going to see oil prices go to $120, $150 a barrel. You can’t keep doing what they’re doing and not expect that result.
Now, they might crash the entire world economy. We still need oil. Cold kills more people than heat. Winter’s coming, and people will start using natural resources.
There’s no way around it. Look at California—they want to eliminate gas cars by 2035. Are you crazy? They can’t even keep their lights on right now, and they’re talking about going all-electric. People realize this stuff doesn’t make sense.
Eventually, the equation will correct itself. One way or another, it will come back. When that day happens, if you’re sitting on several hundred million barrels of oil, knowing that’s what the country needs, you’re in a powerful position. That’s exactly where we’re putting our partners.
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Yeah, interesting. I think a lot of people just don’t realize the whole magnitude of green energy as well. We think, okay, if we’re going to have an electric car, then we’re not producing emissions out there, so we’re good to go.
But in the meantime, the amount of petroleum-based energy it took to mine and create that battery in the first place—I believe it’s over 70 percent, correct me if I’m wrong—went into producing that battery. You’re driving over asphalt roads and concrete bridges, and all these other things still go into the infrastructure.
So, I think there’s not only a supply-and-demand issue, but there’s also a global infrastructure issue at the heart of this. Even if we wanted to convert 100 percent to green energy tomorrow, it’s going to take a long time and a lot of investment to retool things.
This is at a global level—it’s not just the U.S.; it’s everywhere.
Yeah, well look, the beautiful predictor of the future is just watch. Historically, if you watch what happens there, six months later it comes here.
So right now, I can remember a certain president telling a certain group of leaders of another country at the U.N., “Hey, if you become dependent on Russia’s gas and time gets tough, they’re going to cut you off. You’re at their mercy.” I remember those country leaders laughing at the president.
Well, where are they sitting a couple of years later? That’s exactly what’s happening everywhere. If you are dependent on someone as a country, if you don’t control your food, your water, or your medicine, somebody else does, and they can.
Well, another one there is energy. Energy is the driver to every civilization moving to the next level. In that evolutionary change, so to speak, to get from third world to first world, you have to have energy supplies. You can’t burn wood for heat. You need to have energy.
It takes that energy supply. When you restrict a country’s energy, you restrict their growth.
Now, let’s take it on a practical level. How many women—and this is not a sexy statement, I’m just looking at some of the women I know—how many women would be happy to know, “You know what, you don’t get to wear makeup anymore because it’s a petroleum product”? You think they’re going to have a happy group of women out there?
No. Well, that’s the everyday application of oil products that nobody pays attention to—the plastics, the medicines, the makeup, the spandex. There’s so much that oil is used for. There are several thousand products created from one barrel. It’s not just what we put in our cars, it’s not just what we put on the asphalt, it’s not just what we put in the jets. It’s what we utilize that oil for in everyday products.
You can grab any American, and I would bet everything I own, you can grab any American at any point in time, and they will have at least one oil product on their body. That’s how much it is ingrained in our society.
So it’s not a bad thing. Look, we burn—we are the Saudi Arabia of natural gas. If you truly wanted to fix the environment, you’d go nuclear or you’d go natural gas. They’re the cleanest burning fuels we have.
Well, in the United States, we have an abundance of natural gas. Yes, we’d have to do a lot of infrastructure work, but not near the infrastructure work you would need for an electric grid. Heck, take one average neighborhood in America right now and make every house an electric charging station, and it crashes their grid. They don’t have the energy. We don’t have the infrastructure to do it.
Now, in a society where the government doesn’t really care about spending—oh heck, we can redo that, that’s jobs for everybody—well, how do you pay for that, and does it make sense to spend a hundred times more versus what it would cost you, say, one time to do it on a cheap, clean burner? It doesn’t make sense.
We have—you could run gas lines to each house. You could convert every car to natural gas, where you basically just like your gas stove in your kitchen. It fills your car up when you get home, you pop it. We could do all of that.
The power, the will’s not there to do it. Why? It would cost too many people that have money invested elsewhere. It costs them too much money.
We were talking before we started the interview about how complex things are. Well, we as humans make things much more complicated than they really are, and that’s a fact. We could do all of this for a tenth of what they’re wanting to do. Why wouldn’t we?
Common sense tells me they have more to gain by going the other route and have a lot to lose by going the cheaper route. So, it just—the money motivates everything.
You hate to say it, but follow the money. As you know in human history, that’s about the quickest way to figure out what’s going on in any pattern: just follow the money.
Yeah, good point, RJ. Given that, and you had your crystal ball, where do you foresee oil and gas prices headed within the next year or two?
I kind of— I can’t predict. It’s really hard because right now, you’re having a dip in demand, but the dip in demand is not because of personal consumer choice. They’re being forced to dip it because they can’t afford to pay for it now. So, you’re going to see a drop in oil and gas prices just because they’re making it so hard to get.
Well, on the flip side of that, once the prices go down, people will start using it again, and prices will start going back up because there’s nothing there to replace it with. So, you’re going to see it do this over the next couple of years until this insanity wears off.
I kind of look at it one of two ways. Either America is who we are right now with President Biden and the Democratic party. If that’s who we are and that’s the path the country is going to go, well, you know what? My partners are going to make a bunch of money because, at the end of the day, oil prices are going to go up. There’s no down. Oil prices will come, and they’re going to make it restrictive.
So, all of a sudden, my partners—while it sucks (it’s a crude word, but I guess it’s the best way to put it)—well, yeah, it sucks for everybody, but at least my partners will be making a tremendous amount of money during that time.
Now, the other side is, let’s say America does correct, and let’s say we stop doing the fantasy things we’re doing right now and we go back to sound, basic, one-two-three economics. Well, you’ll see the price stabilize at that point. Where is it going to stabilize? Ah, pulling my crystal ball, I’d say, when it’s all said and done, several years from now, it’ll settle between 65 and 85.
I think that’s about right because, what you see is, you see prices do this. I’m not saying there’s manipulation to it, but it’s uncanny how it works. You watched during the first Gulf War. When we first launched bombs and started doing that, you saw prices go up to about 80 or 85.
Well, as they crossed 60, our economy kept rolling. Across 65, our economy kept rolling. Across 70, it started to check back a little. At 75, we started to check back more. When it hit 80, the economy darn near came to a stop.
Well, all of a sudden, the powers that be said, “Whoa, okay, there’s the top. We can’t go past 80.” Well, it was amazing. All of a sudden, you looked up less than a month later, and oil was at 65. It stayed there for 20 years.
So, I think this is the process we’re going through again. It got pushed up to 120, and when it got pushed up to 120, all of a sudden, the brakes on the world economy started locking up. So now, it’s coming back down.
Well, it will find an equilibrium where all the businesses say, “Okay, man, I hate paying 80, but you know what? We can pay 80, and we can keep going.” So, you’ll see businesses pick back up at a certain dollar amount. When they do, that’s where you’ll see prices peg.
I think it’ll be between—trying to get more accurate—I’d say 75 to 85. I said 65 to 85, but if I’m going to be more accurate, I’d say 75 to 85.
And so, now, am I going to be right? Time will tell. I don’t know.
No, that’s a very pragmatic way to look at it. I mean, I’ve heard analysts forecast it up to 200, as high as 200. But obviously, we have lots of different events going on—geopolitical events across the globe. There are so many different factors right now, so it is an interesting time.
RJ, let’s jump into tax benefits as well because we have a lot of investors who are high-income W-2 earners, making active income. This is really one of the top three investments we’ve identified that supports our investment thesis and can help investors offset their W-2 income.
For people who aren’t really familiar with the tax benefits and how that works when you’re investing in oil and gas, can you shed a little bit of light on that?
I absolutely, as I said a minute ago, the best thing I could tell you to do is go to panx.us backslash learn and download Oil and Gas 102. That is a full, it’s easy to understand, we just kind of walk you through the basic benefits of oil and gas investing.
Now, I’m not a CPA, so don’t set me in stone, I can just kind of give you a general rule of thumb. Investing in domestic drilling, investing in a drilling program, you’re going to get roughly 90% of your investment the first year to write off. Cash on cash is going to be, let’s say you put a hundred thousand dollars in a program, you get a 90% write-off. Well, ninety thousand of that is tax deductible. You take that ninety thousand, multiply by your tax bracket, and you get the actual dollar for dollar amount.
Now, like I said, everybody’s going to vary a little bit because everybody’s in a different situation, but Uncle Sam roughly pays for a third of your investment. So going into a drilling program, now I had a partner tell me a long time ago, I said, “Well, Mr. Jones, you can write it off.” He said, “Boy, if I wanted to write it off, I’d give it to the Boy Scouts.”
So, you don’t invest in oil and gas specifically for the tax benefits. However, for you to ignore the tax benefits would be a huge mistake because they are significant. You know, like I said, if you owe Uncle Sam 150 thousand dollars at the end of the year, and you put a hundred thousand in a joint program, Uncle Sam’s going to look at you now and say, “Okay, you don’t owe me 150 thousand, you owe me 115 thousand.” That’s a pretty tremendous tax.
Now, the reason you get in oil and gas is the returns. I mean, you take, we just drilled two wells down on the Choctaw down in Louisiana. One well had seven pay zones, roughly 260 feet of pay. The other well had 15 pay zones, a little over 300 feet of pay.
Now, each one of those pay zones is essentially a well unto itself. In the first 45 days of production, these two wells have produced over 7,000 barrels of oil, and we’re not even in the best zones. My partners on that program out of those two bottom zones, they’ll end up making on a hundred thousand dollar investment about fifty thousand in the first year off two zones that aren’t our best.
Now, when we move up to the next zone, because basically, when you produce a well, you start at the bottom because if you started midway up, when you’re done with that particular zone, you have to drill back through it to get to the bottom. Chances are you won’t go back down and get what’s below.
So you start at the bottom and every time you deplete a zone, you plug it off, move up and hit the next one, produce it for however long, plug it off, move up, hit the next one. You realize my partners on these wells could be receiving revenue from them 20, 25 years from now. Each one of these zones should produce anywhere from two to five years.
Well, in one well I have seven zones, and in the other well I have 15 zones. If my partners’ investment, if these wells keep doing what they’re doing, we fully expect to, I mean there’s nothing that tells us they won’t. We’re already producing them. So now we’re past the true gamble stage. Well, if these wells just keep doing what they’re doing, my partner will have all their investment dollars back in their pocket in 12 to 24 months, and then it’s gravy at that point. Every dollar they make is profit.
Well, if these wells produce at these levels for 15 years, all of a sudden, I have partners that have turned a hundred thousand dollars and seven, eight hundred thousand. Prices go to 120, all of a sudden, that seven, eight hundred thousand turns into a million, 1.2 million. That’s why people get involved in oil and gas.
Now, is it guaranteed? No. If anybody ever calls you and guarantees you something, especially on gas, they’re lying to you. There are no guarantees.
Now, what I can guarantee you is we come early, stay late, work hard and leave no stone unturned when it comes to making our partners money. Because like you, you’re in business without your partners, you don’t have a business. Without my partners, I’m not sitting where I’m at.
So every decision we make has one foundational, fundamental behind it: is it good for our partners? Because if it’s not good for our partners, we don’t do it. It doesn’t make sense. I’m here to make my partners money, not hurt them.
So when we go through the process, when the listeners are evaluating, one of the keys is find out who you’re doing business with. You know, one of the quickest ways I’ve learned to check somebody’s credibility is see how long they’ve had their phone number. If you have somebody who’s changed phone numbers a dozen times, there’s a reason.
I’ve had the same phone number since I was 24 years old. And I, and yeah, I’ll go ahead and admit I was one of the late ones to the cell phone world. I made my living on the phone, and so I kind of, when I was 24, I lived to the mind, “Well, if you want to reach me, you can either call me at the office or call me at the house.”
One of the two, the time in my car is myself. Yeah, and that was a childish, and that was, you know, not the right thinking at that point in time, but I was young, well married, had a kid, and all of a sudden, my wife looks at me and says, “Well baby, what happens if I need to get in touch with you?”
And so, yeah, I got guilted into getting my first cell phone. Now I look back, I don’t even know what I’d do without my cell phone. I mean now it’s because now it’s become an extra appendage on my body, but, you know, and so I was one of those late covers doing it.
Yeah, I hear you. So I guess in closing, RJ, what would you recommend to, you know, people who are, again, new, they’ve never invested in oil and gas before? We will put a link to your, you know, your website and everything, we’ll put that in the show notes for people to check out. But just any, you know, your single biggest recommendation, right? If someone’s trying to do some due diligence and, you know, get into the industry, you know, what would your recommendation be?
I can’t speak for anybody else, but I can speak for me. If you, I would love to speak with anybody. This is, I make my living on a phone. I make my living telling people what we do for a living. Well, don’t take my word for it. Go to our website again at panx.us backslash learn and click on our testimonials. This is what our partners, guys that have their money with us, think of us. That’s the best way I can tell you is to check somebody who’s done business with who you’re looking at. You know, find out what they think of them.
I’ve always lived in a mind, if one person says something, it might be a coincidence. You know, it might be an accident. If two people say something, it might be a coincidence. If three people say something, hey, there might be some truth to it. If four people say the same thing, man, there’s got to be some truth to it. And so, that’s why we want to overwhelm you with our partners. We want you to know that they like investing with us. Not because we want every time, I will not insult your intelligence to tell you we’ve had every well we’ve drilled.
They enjoy investing with us because I’m always upfront with them, win, lose, or draw, good, bad, or indifferent. It is what it is, and I’m going to tell you exactly what it is and not sugarcoat it. But more importantly, they know we’re going to leave no stone unturned when it comes to making them money because that’s what you hire us to do.
And when people put, you know, some people lose sight of this. Most people didn’t come by their funds, their finances, easy. Most people had to give blood, sweat, and tears to earn where they’re at in life. Well, man, that’s sacred. If somebody has faith in you and sends you their family’s money, shame on you if you don’t give them everything you have because that’s what they deserve.
And so, that’s all I can do. All I can do is show up every day, come early, stay late, and leave no stone unturned, working as hard as I can to make you as much money as I can.
Yeah, 100%. We share the same philosophy as well and need to be critically good sponsors and stewards of our investors’ capital.
Oh, without a doubt. Yeah, without a doubt.
So, I really appreciate you coming on the show today, RJ. I mean, just a wealth of information and insights, I think, for folks, especially those new to the space and really trying to understand more about how it works and especially, I think, the unique time frame that we’re in for this type of opportunity. So, thanks again for coming on, and we will definitely put a link into the show notes. Any other places you’d like to point out for folks to reach out or connect with you?
Alright, just email me at [email protected]. I take no issue with it, reach out to me. Oil and gas is for everybody. I’m fully aware of that. Well, you never know until you talk to somebody. Call us, see what we can do, and if it’s not for you, heck, you’re not going to hurt our feelings. I’ve been told no before; this is my first rodeo. But call and check, because we could do some tremendous things for you. And if it’s not for you, I’ll be the first one to tell you, “Don’t do it.” If this money would change your lifestyle, if the world opened up and swallowed our company and it would change the clothes you wear, the car you drive, or the food you eat, it’s not for you. Don’t do it.
You know, this is money that you can put with our company and let me go to work. Now, if you’re in that position, you need some tax benefits, and you have some free finances where you can let this old boy from Kentucky go to work for you, hey, give us a call. Let us show you what we can do. If you want to do it, terrific, we’ll show you how to get started. If not, like I said, you’re not going to hurt our feelings. We’ve been told no before.
Well, thank you very much for your time, and we’ll part as friends.
Great. Alright, thanks again, RJ. Really appreciate you being on the show.
Alright, thank you very much. Have a wonderful day. Until next time.
Awesome.