Hidden deep underground, shale oil and gas deposits are being discovered all across the country from Texas and Wyoming to the Utica Shale reserve in eastern Ohio and into Pennsylvania. Now Colorado’s Weld County has recently announced its own recent finding of a colossal shale oil and gas reserve called Niobrara that is worth potentially billions of dollars.
Local residents have expressed mixed feelings about the find as the act of excavating, drilling and fracking is a huge undertaking that can be disruptive to the way of life in these communities. Yet financing oil and gas projects brings great opportunity to these regions as well in terms of jobs and a boost to the local economy. Hotels, restaurants, apartment rentals, and light industrial businesses have all experienced an uptick in business as a result of the drilling.
Freight Factoring Companies Fund Trucks Needed for Drilling
In addition to area businesses picking up and contractors moving in, financing companies such as invoicing factoring companies are setting aside huge segments of cash to make the setup, excavation and transportation all possible. Just to help paint a picture of the size of this endeavor, one of the first wells dug produced $4 million worth of crude oil within 3 months, that’s more than 2000 barrels a day. With applications for drilling permits and such piling up at the local government office, the question of sufficient oil and gas funding remains on everyone’s minds as well.
Factoring Receivables Is Ideal for Boom and Bust Industries
Traditional oil and gas funding may be available for oil and gas projects of this nature. Yet other forms of financing such as factoring receivables may work equally as well or better. Oil and gas factoring is ideal for businesses such as contractors, drillers, welders, excavators, truckers and others where a lump sum of money is needed in advance to begin and complete the project long before payment is ever received.
That is, oil and gas factoring can cover the operating costs associated with excavation, including payroll, even though the payout from the oil and gas find won’t be collected for several weeks down the road. This is the nature of factoring receivables in general; the factoring company pays now and waits to collect later. Along these same lines in a related industry, freight factoring is a fast moving entity so you can get the cash you need in a matter of days, not weeks. If your client has good credit, even if you don’t, you can take advantages of invoice factoring services that are offered by companies like ours.