by Mike Mattox, Board of Directors at Copestone Energy Partners / Issue 2
The EB-5 industry is stale. A savvy investor looking to come to the United States through the EB-5 investment program should always consider the constantly changing economic conditions for their investment. With upcoming changes to the EB-5 program itself, as well as constantly adapting economic conditions, real estate projects are, simply put, not as attractive as they once were. The EB-5 market has a long history of real estate projects due to the struggling economic conditions for local developers during the United States recession in 2008. Since that time, the difficulty of developers securing financing has changed. A typical real estate project with EB-5 financing returns the investor’s money through refinancing the loan or sale of the entire project. Due to a variety of contributing factors, it is now becoming cheaper for a financially attractive project to find investment domestically. What does this mean for an EB-5 investor today? Consider this.
If a financially attractive project can get its investment close to home, without having currency risk, expensive marketing budgets, or excess regulation by the US government, then there is no reason to seek international investment. This means the real estate projects that are being presented for EB-5 may be projects too risky for the US market. The projects that are now being marketed for EB-5 investment may pose a risk to the investor down the line, or EB-5 investors are going to be secondary creditors in the project’s capital payback plan, and, typically, provides miniscule interest in return. This may be troubling to hear. While this evaluation does not encompass all projects in the real estate market, it is a trend in which to be aware of moving forward. There are still good projects out there; however, investor due diligence is becoming more important as the industry adapts. The EB-5 industry is evolving and investments must diversify.
The oil industry is no stranger to the Middle East. Oil has contributed to an enormous amount of wealth to both the infrastructure and economic growth of the area. The United States has its own rich history with oil, which created some of the world’s wealthiest families. Even though oil has gone through a difficult few years, the industry seems to have bounced back and stabilized.
Access Texas Oil and Gas LLC
Access Texas Oil and Gas LLC is an oil company with complete dedication to its investors. Our goal is to create attractive investments, but our main priority is to take care of our investors and make sure they are protected.
ATOG combines the knowledge and experience of some of the top experts in the US oil industry as well as the EB-5 experience of Access Group. With the combination of both teams, ATOG is proud to offer EB-5 investment options for oil and gas.
While oil and gas projects vary in their degree of risk, the team at Access Group has designed the investment strategy in order to protect the EB-5 investor. These projects currently have proven, existing, and successful wells producing oil and gas. Additionally, because of their location and likely job creation, they are ideal for achieving the immigration requirements at the minimum investment amount.
Alongside the careful construction of the investment itself, Access Group recruits some of the top experts in the oil industry to research and construct projects with attractive qualities. The team at Access Group does in-depth analysis of each project in order to make sure it meets the geological, financial, and immigration standards for EB-5 participants.
The Colonial EB-5 Investment Project
Access Texas Oil and Gas LLC is proud to introduce the Colonial EB-5 Investment Project. The Colonial Drilling Site is located in central Texas in the acclaimed Austin Chalk Formation. Oil and Gas exploration began in the Austin Chalk Formation during the 1920’s. According to the Society of Petroleum of Engineers, the Austin Chalk has produced over 1.7 Billion BOE with about 9,500 wells.
The specific site of 10,000 acres has been acquired by ATOG and through previous EB-5 oil investment, has calculated that the Colonial Drilling Project can include up to 100 participants for EB-5 investment. This number is calculated based on the anticipated job creation which meet the US Government’s requirements for the program. Due to the location of the project, the Colonial drilling site qualifies for the lower investment amount because of its rural area classification, so no matter the pending changes for the TEA requirements of the EB-5 Program, the Colonial drilling site will always qualify for the lower amount because of its rural project location. To protect the EB-5 investors, the drilling project is structured as a loan. This is the same financial model as the popular real estate model, so investors can be familiar with the financial transaction. In addition to an above average EB-5 rate of return, the added benefit of this project is that the investment is not tied to the success of an individual well, but multiple wells, being drilled in order to spread the chance of successful wells throughout the project site within the proven formation. Investors are thus creditors, and have the first priority payout for the loan as oil is produced.
With the advanced technology of today’s drilling teams, the proven formation of the Austin Chalk, and the project meeting all of the requirements through the EB-5 investment program, the Colonial Drilling Project provides investors a great way to diversify their portfolios while pursuing their goals of permanent US Residency.