Direct oil and gas investment means owning a working interest — a fractional ownership stake in specific wells, with the revenue, the costs, the tax treatment, and the liabilities of an owner. This page covers what the instrument is, how the process runs, and what you are taking on. It quotes no returns or income figures; program economics belong in offering documents where they can be read next to their assumptions.
Intangible drilling costs are 100% deductible in the year incurred under §263(c). IDCs are fully deductible — your investment is not; the tangible portion is depreciated.
Tax treatment →Revenue is typically distributed monthly once a well produces and title and division orders are clear. Amounts vary every month, and distributions can pause or stop.
How distributions work →Different drivers than equities — but a single program is concentrated, not diversified, and can go to zero regardless of oil prices.
Portfolio role →These offerings are limited to accredited investors. Verification is documented as part of subscription.
The private placement memorandum, the operating or joint operating agreement, the AFE (cost estimate per well), the geological basis, the operator's background, and the risk factors. Read the risk factors first — they are where the deal is actually described.
Your CPA on tax treatment and holding form, your attorney on liability and the subscription documents. Use our tax calculator for an illustration only — it is not advice and it is not a projection of returns.
Execute the subscription agreement, accreditation verification, and program agreements. Confirm in writing how you will hold the interest — it affects both your tax treatment and your liability.
Funds are transmitted per the offering's instructions. Then comes permitting, rig scheduling, drilling, completion or plugging, connection to a purchaser, title work, and division orders — before any distribution. The gap between funding and a first payment is measured in months and routinely slips for title curative, division-order processing, or takeaway. Timing in any specific program is an estimate in that program's documents, not a commitment. See How Distributions Work.
And one thing you may receive that is easy to miss: an invoice. A working-interest owner can be assessed for workovers, recompletions, equipment, disposal, and plugging. Whether and how a specific program can call capital is stated in its offering documents — ask directly.
Oil and gas drilling programs are speculative and illiquid, and the loss of your entire investment is a realistic outcome. The principal risks include:
Tax discussion last reviewed July 2026. General information only — not tax, legal, or investment advice. Offers are made solely through offering documents to accredited investors.
Request the investor package and offering documents, including the AFE and risk disclosures.
Investor Briefing
Answer a few quick questions to receive current project details and tax documentation.
For accredited investors · takes about 30 seconds
