The Case for Investing in Oil & Gas Royalty Interests - Interview: Derren Geiger, Cornerstone Acquisition & Management Co., LLC - Private Wealth Management Summit 2014

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For more information contact: emailus@marcusevans.com …

For more information contact: emailus@marcusevans.com

An interview with Derren Geiger of Cornerstone Acquisition & Management Co., LLC, an asset management company at the marcus evans Private Wealth Management Summit Fall 2013 discusses why private wealth managers and high net worth individuals should consider investing in oil and gas royalty interests.

Join the 2014 Private Wealth Management Summit along with leading regional investors in an intimate environment for a highly focused discussion on the latest investment strategies in the market.

For more information contact: emailus@marcusevans.com



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  • 1. The Case for Investing in Interview with: Derren Geiger, Chief Operating Officer, Cornerstone Acquisition & Management Co., LLC The global demand for oil and gas is consistently increasing, with royalty interests providing an excellent vehicle for investing in the asset class, according to Derren Geiger, Chief Operating Officer, Cornerstone Acquisition & Management Co., LLC. “Royalties have relatively low volatility and produce a consistent return based on the sale of a tangible asset each month,” he details. From an asset management company attending the marcus evans Private Wealth Management Summit Fall 2013 in Las Vegas, Nevada, December 8-10, Geiger discusses why private wealth managers and high net worth individuals should consider investing in oil and gas royalty interests. Why should investors consider oil and gas royalty interests? The allure of royalties is that they are a conservative investment vehicle for those seeking private oil and gas asset exposure and a long-term bullish outlook on energy. Owners are paid directly off top-line gross revenues and are not subject to operating expenses. Royalties offer investors a consistent cash flow yield, hard asset exposure and a prudent currency and inflation hedge. Royalties have relatively low volatility and trade in a robust secondary market. The Caritas Funds invest primarily in oil and gas royalty interests, located onshore throughout the Continental US. How do royalties correlate with other oil and gas assets? Royalty interests are inherently stable due to the consistent production-related cash flow generated on a monthly basis. Privately held oil and gas assets are not as tightly correlated to spot oil and gas prices or broad market indices such as the S&P 500 relative to several other publicly traded energy -related investments. What we try to do is enhance that stable return and reduce volatility through aggressive hedging of forward production. Caritas will sell a certain percentage of production up to four years forward if locking in oil and gas prices meets or exceeds our targeted return parameters. Why now? Is it a particularly advantageous time to invest in the asset? Overall global demand is rising on the back of non-OECD countries, resulting in developed and non-developed country demand essentially being equal for the first time in history. Total global demand should reach a record of approximately 90 million barrels a day in 2013, which is expected to rise by around one percent per year going forward. Secondly, we have seen a very dramatic change in technological advances in the oil and gas sector over the course of the last several years. Massive developments in imaging, drilling, and extraction has led to multi-decade highs in US oil and gas production. Currently, the US is producing about 7.6 million barrels a day, the highest level since 1992, and is expected to reach 8 million barrels a day in 2014. Infrastructure advancements have also led to dramatic improvements of domestic crude oil pricing. Pipeline, trucking and rail take-away capacity have efficiently moved crude oil to the high demand hubs, pulling WTI pricing higher toward that of the global Brent benchmark. The US is among the cheapest current sources of natural gas production on the planet. We have gone from natural gas production shortages a few years ago to planning extensive exports in the decades ahead. Furthermore, the ongoing transition from coal to natural gas will increase market share in the electricity generation sector going forward. Finally, Cornerstone has developed extensive relationships in the oil and gas space over a nine-year timeframe that consistently provides enhanced deal flow on attractive assets that are not broadly marketed. How is the secondary market for royalty assets? While royalty interests are private oil and gas assets, the secondary market for royalties is quite liquid due to their cash flow generation allure. Royalty portfolios of virtually any size are typically sold in a matter of 30-45 days or less. Why are they considered suitable for long-term investors? Global oil and gas demand is rising on a continuous basis as non-OECD country demographics evolve. Technological advancements in the US oil and gas sector have led to an energy revolution that continues to grow. The US possesses several world class oil and natural gas fields that the Caritas Funds have direct exposure to. Royalties provide a cash flow vehicle that generates consistent yield through the production of high demand energy commodities. The Caritas portfolio is dynamic and diverse, managed by a team focused on property, acquisition and hedging discipline. Royalties offer investors a consistent cash flow yield, hard asset exposure and a prudent currency and inflation hedge Oil & Gas Royalty Interests
  • 2. The Investment Network – marcus evans Summits group delivers peer-to-peer information on strategic matters, professional t r e n d s a n d b r e a k t h r o u g h innovations. Please note that the Summit is a closed business event and the number of participants strictly limited. About the Private Wealth Management Summit Fall 2013 This unique forum will take place at the Red Rock Casino, Resort & Spa, Las Vegas, Nevada, December 8-10, 2013. Offering much more than any conference, exhibition or trade show, this exclusive meeting will bring together esteemed industry thought leaders and solution providers to a highly focused and interactive networking event. The Summit includes presentations on the global market outlook for 2014, the key trends shaping the industry, fresh approaches to portfolio construction and formulating winning asset allocation strategies. www.privatewealthsummit.com About Cornerstone Acquisition & Management Co., LLC Cornerstone Acquisition & Management Co., LLC is the Portfolio Manager of the Caritas Fund, a hedge fund that invests primarily in oil and natural gas royalty and mineral interests. The underlying assets of the Caritas Funds include interests in thousands of wells spread throughout 21 states in the Continental U.S. (very diverse, yet no offshore drilling exposure). The portfolio possesses a dynamic mix of legacy positions (long-life, low declining production) with high growth assets located in world class basins/ reservoirs. The Caritas Funds generate return through payments received on oil and gas production, leasing mineral rights and portfolio appreciation. The Caritas Team has managed the Funds since 2004 through some of the most volatile energy price environments, generating very attractive risk-adjusted returns over a nine year tenure. www.cornerstoneamc.com About marcus evans Summits marcus evans Summits are high level business forums for the world’s leading decision-makers to meet, learn and discuss strategies and solutions. Held at exclusive locations around the world, these events provide attendees with a unique opportunity to individually tailor their schedules of keynote presentations, case studies, roundtables and one-on-one business meetings. For more information, please visit: www.marcusevans.com Upcoming Events Foundations & Endowments Investment Summit - www.foundations-endowmentssummit.com US Pensions Summit - www.uspensions-summit.com To view the web version of this interview, please click here: www.privatewealthsummit.com/DerrenGeiger Contact Sarin Kouyoumdjian-Gurunlian, Press Manager, marcus evans, Summits Division Tel: + 357 22 849 313 Email: press@marcusevanscy.com For more information please send an email to info@marcusevanscy.com All rights reserved. The above content may be republished or reproduced. Kindly inform us by sending an email to press@marcusevanscy.com