How long has Red Rock been in business?

Red Rock Energy Partners, Ltd. has been in business since 2001, and the principals of the company have a combined 26 years of experience in the oil and gas industry.


How many wells has Red Rock drilled?

Red Rock Energy Partners has drilled eleven wells to date.


How long do oil & gas wells produce?

Oil & Gas wells have a lifespan between 12 and 50+ years. The lifespan is dependent on the proven reserves the well has.


What is an accredited investor?

An “Accredited Investor” is a term defined in Rule 501 of Regulations D of the IRS code.


Is there any way to reduce the risk?

One way to reduce the risk of a “dry hole” is to invest in a multiple well program. Any investor who participated in all of Red Rock’s current wells to date averaged cash-on-cash returns of 73.10% in 2005 and 86.25% in 2006. Red Rock Energy Partners gathers and evaluates all the current geological and well data before determining where to drill a well. Red Rock will typically carry between 25% to 50% ownership of any given well so it is in our interest to make the best possible choice. However, nothing can offset a “dry hole” which is defined as any well that fails to discover oil or gas in paying quantities. Investing in multiple wells reduces the chance that ALL of them could be dry holes. Obviously that is possible, but it has not been our experience to date.


What is your minimum investment?

The minimum investment is entirely dependent on the particular well being drilled. Each well is unique and the minimum investment is determined when the program is developed. Contact Red Rock Energy Partners for information regarding specific well packages currently available.


How do I make money in a well?

Investors make money from monthly revenue with the possibility of a bundled purchase by a major oil & gas company (buy-out). Tax benefits reduce the overall costs of the investment.


What is working interest/net revenue interest?

Working Interest: The operating interest under an oil and gas lease and/or contractual working interest acquired through farmout agreements or otherwise, entitling the holder to conduct drilling and production operations on the leased property. The Working Interest will bear all Expenses, Overhead and Cost. For Example, 2% WI is responsible for 2% of all Expenses, Overhead and Costs associated with drilling and completing a well.

Net Revenue Interest: That portion of the proceeds of the sale of Products allocated to the owners of the Working Interest in accordance with their respective revenue interest. This is typically 75% of the total. The remaining 25% pays the lease owners their share of the mineral production.


What does going “consent” or “non-consent” mean?

Sometimes a well will be reworked to increase production or to exploit other zones. Additional costs are incurred when this is done. Consent means the investor agrees to pay these additional costs and subsequently participates in any new profits generated by those efforts. Non-consent means the investor refuses to pay these additional costs. Since there is no way to distinguish the new production from the old, it is not fair to the other “consenting” investors to allow a “non-consenting” investor to reap the benefits of the new production without bearing the risk taken to get that production. Therefore, substantial penalties are incurred by the “non-consenting” investor to compensate the risk taken by the “consenting” investors. Until those penalties are paid out of the revenues generated, the “non-consenting” investor receives no revenues from the production of the well.


What is a turnkey well?

A well that is drilled, completed and put into production at a defined price.

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