Asset Digitization: Speeding up funding time for Oil Campaigns
Efficiency is and should be of primary concern to business owners across sectors. What can be done in a day should not be taking a week to accomplish — generally. That notion can be extrapolated to, and is in fact very relevant to, the Oil and Gas industry. When it comes to capital raising for ongoing drilling campaigns and capitalizing on proven oil reserves, there have been only that many traditional financing options available to companies and investors in the space such as private placement, debt financing, mezzanine financing and, on rare occasions, a couple of alternative options available to some within their private networks. All of the mentioned options are time-consuming, costly and involve multiple middlemen making lack of transparent an ongoing issue.
Innovating business models via a complete digitization strategy introduces solutions in the form of investable digital assets. In the case of proven oil reserves and oil campaigns, asset digitization using the blockchain as a business mode enabler allows a highly regulated industry to transact almost instantaneously from investment to trade. This novel process introduces a faster, smarter and easier way to monetize proven oil assets and capitalize on producing oil campaigns.
With regulatory and compliance systems and controls, digital assets can be granted the status of financial securities (in certain jurisdictions) complying with the same very laws and regulations as the traditional equities and bonds do. The result is literally a more efficient process for all parties involved in the process of monetizing, trading and capitalizing on proven hydrocarbon assets [assuming the proper platform and technological infrastructure is already in place to support this process].
There are now a few iterations of such initiatives that have entered the market globally, with one of the more compelling and earlier entries made by our team at PermianChain Technologies and with their digital oil asset— XPR — representing investments in proven oil reserves and ongoing oil producing campaigns. PermianChain’s platform incorporates all the aforementioned efficiencies, that way offering an innovative, fully compliant, secure and simply better way for Oil and Gas companies to access capital and investors to access investment opportunities in that space.
