Scott Tominaga on Investing in Oil, Gas, and the Earth
According to Scott Tominaga, geology is often understood as a course in school. It might elicit some assumptions from people who are unfamiliar with geology as a whole.The reality of it is quite fascinating. The world has a lot to be grateful for because of geologists. Scott Tominaga explains that the world’s economy would have collapsed long ago without their expertise. It is not hyperbole, especially in this age where getting resources from the Earth is one primary significance to human life.
Economic valuation, Scott Tominaga says, is a method experts use to determine the impact of any material found on the planet. It is part of naturally occurring resources.
Geologists analyze ground content for their reports. The analysis leads to accurate assessments of the soil’s potential. It is used for farming, mining, or other economic activities. With geological technology, Scott Tominaga mentions that it is also now possible to determine how long resources will last. Sustainability is also a huge part of the equation.
Geologists also determine the viability of a property. They do so by looking closely at the presence of specific resources. Geologists lay down the groundwork for their more business-oriented colleagues. The latter invests if geologists declare that there is money to be made from the soil.
Scott Tominaga notes that economic valuation has been the basis for many success stories in oil and gas investments. Geologists have earned respect from the companies that hire them. The advice they give is critical to many business decisions. It makes perfect sense that they have privileged control of the green light.
Oil and gas remain in demand, perhaps even more so than ever, despite alternatives being discovered or developed left and right. Not only are petroleum, natural gas, and other similar products a popular source of heat or energy, but they can also be used to create asphalt, lubricants, wax, plastics, and more.
According to Scott Tominaga, this abundance of opportunities in the sector makes investing a sound decision. For investors, this is just one of the advantages of putting your money in oil and gas. Then, there’s also the diversification of your portfolio.
Throughout history, oil and gas investments have proven to be an effective diversifier for any portfolio. Proof of this is that a slow economy, which causes most stocks and funds to stagger, usually entails higher oil and gas prices, consequently triggering a rise in stocks in this sector. Such investments can then help insulate a portfolio from fluctuations in the market.
On that note, Scott Tominaga says that the potential profit margin of oil and gas is significantly higher than most investment vehicles, especially when funds are infused in smaller companies. Striking big on even a single well can pay huge dividends in the short- and long-run.
In addition, you’ll have robust tax benefits that can be had when investing in oil and gas, thanks to federal tax codes. These tax incentives include deductions for drilling costs, lease cost deductions, depletion allowance, 1031 exchanges, and many more.
Scott Tominaga is a professional in the hedge fund and financial services industry. He has been responsible for daily back-office operations, including investor relations and marketing. More articles like this on this page.
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