with oil wells · oil wells in Nevada
LenderHawk analysis. Not affiliated with or endorsed by Acquisitions Anonymous.
The hosts see the listing as a speculative mineral-rights or drilling promotion, not an operating business, because the wells have not yet been drilled and the economic case depends entirely on future production assumptions.
A listing with no drilled well and no current production should be evaluated as a speculative project, not an acquisition of cash flow.
When a seller asks $230,000 for 2% of a project, the real question is how much additional capital will be required before any payout exists.
If the pitch hinges on future barrels per day, the investor is underwriting geology, execution, permitting, and commodity price all at once.
A long development timeline can indicate either hard technical work or a project that keeps returning to the market for more money.
When a promoter leans on famous-sounding experts instead of hard operating data, the evidence standard should go up, not down.
Oil and gas can create enormous upside, but the distribution of outcomes is so wide that most individual bets will fail.
Pattern matching matters: if a deal looks unlike the normal flow of real transactions in your market, it probably deserves a hard pass or deeper diligence.
Speculative assets should be sized like venture bets, with many small shots rather than a few concentrated wagers.
A shorthand rule that when an inexperienced buyer faces a highly experienced promoter, the promoter usually captures the economic upside while the buyer learns an expensive lesson.
When to use: Use it when evaluating opaque, story-driven investments where the seller knows far more than the buyer.
A drilling model with a large fixed upfront cost and uncapped upside, where each well can be a total loss or a massive winner depending on the hit rate.
When to use: Use it when considering oil-and-gas projects or any investment with binary, high-variance outcomes.
The listing asks $230,000 for roughly $8 million in annual revenue, according to the teaser read on air.
Michael reads the broker summary before the hosts start criticizing the economics.
The pitch says the wells could produce about 1,000 barrels per day, and a 2% owner would make around $450,000 per year at $90 oil.
The hosts use the seller's own assumptions to show how the upside is framed.
The promo claims the project could reach 4,000 barrels per day based on a nearby well that reportedly produced more than 4,000 barrels per day for seven years.
The hosts treat the nearby-well comparison as the core of the marketing story.
The listing says the area around the project has sites that produced over 22 million barrels on one side and just over 10 million barrels on the other.
This geographic framing is used to imply the Nevada site should be similarly productive.
The seller says the team has spent more than 10 years on research and that the project is in Nevada, Ohio, and referenced through a New Jersey broker number.
The hosts point to the inconsistent location cues as a credibility problem.
The hosts note that the listing appears in an e-commerce and retail category even though it is really an oil project.
They use the mismatched category as another signal that the marketing is sloppy or misleading.
Treat undeveloped mineral-rights pitches as venture-style speculation rather than business buying.
Why: There is no operating cash flow to underwrite, so the buyer is betting on geology and execution instead of proven earnings.
Require hard proof of existing production before believing revenue forecasts in oil deals.
Why: Projected barrels per day can be changed by assumptions, but drilled wells and production history are much harder to fake.
Size speculative bets as a portfolio, not as a single concentrated position.
Why: High-variance outcomes mean a few deals will dominate results, so diversification is the only rational way to manage risk.
Assume the promoter has information advantage unless the diligence package includes independently verifiable evidence.
Why: Oil projects are technically complex and easy to market with selective facts, which puts outsiders at a structural disadvantage.
Walk away when the pitch relies more on famous names and excitement than on production data, reserve reports, and drilling results.
Why: A story-heavy deck usually means the underwriting case is weak or incomplete.
Michael describes a friend who made his fortune in wildcatting, then sat through pitches where some bets returned many multiples and others went to zero. The story illustrates how oil investing can create dramatic wealth but also dramatic drawdowns even for experienced operators.
Lesson: High-upside, high-variance deals can produce real winners, but only investors who accept repeated losses and diversification survive long enough to benefit.
Michael recounts a buddy who worked on rigs where diesel was used to clean oil-covered equipment, water had to be trucked in, and a heater once melted the water containers and caused the water to catch fire. The anecdote is used to show how harsh and operationally weird oil work can be.
Lesson: Oil and gas is not a normal operating environment, so buyers should not underestimate the logistical and safety complexity behind the headline economics.