STRATEGIES

Oil and Gas

Stronghold’s oil and gas strategy consists of systematic and high-frequency transactions in physical properties through partnering with local, in-basin, on-the-ground origination partners.

Key aspects of our investment strategy include:

  • Focus on strong risk-adjusted returns
  • Better insulation from commodity price volatility through rapid transaction pace and structural protection
  • Combine investment and technical expertise to develop a technology-enabled, systematic approach to valuation

A Strong Partner


Stronghold brings capital and operating experience to the companies and entrepreneurs that partner with us. For capital partners, we bring technical depth, industry perspective and, frequently, financial alignment, to drive better investment results.

 

WHAT WE BUY

Leasehold, Mineral & Surface Ownership Positions

Surface Estate (Tract) refers to ownership rights in a parcel of land that are limited to the surface.
Hydrocarbons (oil, gas, etc.) are located below the surface of a given plot of land owned by the Mineral Interest Owner. Ownership of the hydrocarbons can be separated from the ownership of the Surface Estate.
Each subsurface layer (stratum) beneath the tract can be drilled horizontally and is distinct property with potentially distinct owners / leasehold.
Mineral Interest Owners control the rights to produce, to sell, or to lease the production rights to E&P Operators in exchange for a specified royalty rate and an upfront bonus.
E&P Operators seek to produce Hydrocarbons owned by Mineral Interest Owners. E&P Operators find it attractive to purchase the Mineral Interests to increase cash flow with each producing well.
Horizontal Wellbores drilled by an E&P Operator in order to produce Hydrocarbons can result in revenue for the E&P Operator and royalties paid to the Mineral Interest Owner.
Horizontal Wellbores drilled by an E&P Operator in order to produce Hydrocarbons can result in revenue for the E&P Operator and royalties paid to the Mineral Interest Owner.
Leasehold is created when a Mineral Interest Owner leases the right to explore and produce Hydrocarbons to an E&P Operator.
Leasehold is the foundation of an E&P Operator’s drilling plan. The drilling plan cannot proceed w/o the right to drill. Drilling w/o a lease could result in criminal trespass.