This is a reprint of the article “Performing Due Diligence on a Micro-Cap Oil & Gas Company” written by Erik Nelson, President of Coral Capital Partners, Inc. that was published in the Fall, 2011 edition of Micro-Cap Review Magazine. It takes a look at some of the essential items to consider when evaluating a micro-cap oil and gas company as a potential investment. It is an excellent primer on understanding the various terms and their definitions when looking at a potential oil and gas investment. This is the 2nd article authored by Erik Nelson to be published in Micro-Cap Review Magazine, and the 1st through Coral Capital Partners.
Tag: working interest
Working Interest often abbreviated ‘WI’ is the percentage ownership of the lease that the company has the right to drill, produce, and operate as well as share in all the costs associated with the lease activity. I typically like to see a company with a solid majority Working Interest percentage. In my book, the closer to 100% the better. I do not like to see a company with a minority Working Interest position.