Bob Fraser explains why oil fields decline after ten years: they need constant reinvestment in maintenance and upgrades, but investors cash out instead of funding repairs. His firm buys underperforming mid-sized assets and applies value-add work to restore productivity.
No money goes back into the oil field and after 10 years it gets tired, right? Mm-hmm. I mean, this stuff, it needs to be maintained. There needs, it needs to be upgraded. It needs to be, you know, there's always something where it starts slowing down and the, and work needs to be done. You know, rework needs to be done on the wells, that kind of thing. But the system is not set up. The financial structure is not set up to do that. No one wants to write a check. Back. They just want to cash the check. And so what happens is these things end up being underperforming over time. And so what you're coming in is you're buying these things off market and at this kind of, if this kind of size, it's too small for a mom-and-pop investor and too, or too big for mom-and-pop investor and too small for an institutional investor. And so you're able to come in and buy these things off market and then do value add.
