FAQs

Encore Energy, Inc
  • What is Encore Energy?

    Encore Energy is an independent exploration and production company specializing in horizontal drilling operations in Lawrence County, Kentucky. The company functions as lease owner, well operator, and investor in all of its projects.
  • Who can invest with Encore Energy?

    Investment opportunities with Encore Energy are offered exclusively to accredited investors as defined by the SEC, who satisfy particular income, net worth, and sophistication criteria.
  • What type of investments does Encore Energy offer?

    Encore Energy provides direct working interest ownership in horizontal oil drilling operations. This means investors hold an interest in the wells directly, rather than purchasing shares in a publicly traded energy corporation.
  • What is a horizontal drilling project?

    Horizontal drilling is a sophisticated drilling method that enables operators to reach larger portions of oil and gas formations than conventional vertical wells, which may result in improved production efficiency, enhanced value creation, reduced investor risk, and greater production volume and reserves. As a non-conventional operation, each well incorporates multi-stage fracking together with MDW (measure while drilling) directional and horizontal drilling techniques.
  • What tax benefits may be available to investors?

    Under IRS Section 263, eligible investors may be able to deduct a substantial portion of qualifying drilling expenses. These benefits include an 87% IDC deduction in the first year with the remaining TDC in following years. Additionally, the depletion allowance allows 15% of all taxable production income to be deducted throughout the life of the well. Investors should consult with their personal tax advisor about their specific tax circumstances.
  • Does Encore Energy operate its own wells?

    Yes. Encore Energy acts as the bonded well operator for all of its projects and handles drilling, completion, production operations, and associated infrastructure. Encore offers sophisticated investors a distinctive opportunity to participate directly with the operator of each well project, ensuring transparency, real-time reporting, and reduced well costs for every project.
  • How do investors receive income from their investment?

    Once wells are in production, investors may receive distributions according to their ownership interest and the revenue produced from oil sales, after accounting for operating expenses and market conditions. Encore's oil production is delivered refiner-direct to Ergon, Ohio and commands the highest oil price for its premium quality crude oil. Investors receive monthly revenue distributions along with multiple statements from both Encore and the refiner.
  • What makes Encore Energy different from other energy investments?

    Encore Energy offers direct ownership opportunities, handles projects internally, concentrates on proven producing regions, and prioritizes transparency and investor communication throughout a project's lifecycle. There are no intermediaries. In contrast to larger exploration and production companies, Encore focuses solely on Proven (PUD) areas that are direct offsets to or located near successful production in the Berea play.
  • What is a Proven Undeveloped (PUD) drilling location?

    A PUD location is a site where geological and engineering information indicates that oil and gas reserves can be economically developed in the future. Encore concentrates on these opportunities to help minimize exploration risk. According to the SEC, proven undeveloped projects are situated directly offset to proven producing projects and carry a 90% probability of success in reaching commercial production.
  • Are oil and gas investments risky?

    Yes. Oil and gas investments carry significant risks, including commodity price volatility, operational difficulties, production uncertainty, and the potential for complete loss of invested capital. Oil and gas investments are appropriate only for investors who can financially tolerate losing their entire investment.