#228 The Truth About Mineral Rights Investments

Hey, everyone. Today we're gonna have a really fun conversation with Troy Eckert. He might be known to many of you in this community, but oftentimes we just find out more about him and his business. We don't often dive into some of the deeper questions that we need to dive into to get full due diligence on him. In fact, I think it's gonna be one of our most interesting conversations because, Troy, if you're okay with it, I'm gonna ask you some tough questions today that maybe people are afraid to ask you. They don't want to offend you. But these are the questions that people need to know and the answers people need to know to figure out whether you be someone good to invest with and whether Eckerd Enterprises make sense. What do you think, Troy? Can we do that today? What?

Peter, I. I love the way you approach life and the way you approach all your listeners, because the fact is, it takes a great conversation to get to the truth. And that's what we're here to do. We're here to talk about the truth and opportunity. So let's go.

All right, so let's have fun with this. Just. I'm going to do a quick intro for you. This is Troy Eckard. Again, he's pretty well known to our PIMD community. He's been an energy expert since 1985. He started Eckard Enterprises. Been in this industry at a long time, but he still looks very young. But. But again, it's been an industry that's evolved so much over that time, but he's seen it through the different cycles. So again, he owns Eckerd Enterprises. Again, I've been investing with Troy for many years. Many of you are investors with Troy. He's been showing up at our conferences. He's been there, and many of you met him in person. Such a fun person to talk to. Troy, what else do I need to add about you and your business and middle rights?

Right. I think the main thing is that when I look at successful businesses, it usually is something that evolved from a passion and a level of expertise. It's something whether you're a doctor, dentist, investment guy, oil and gas guy, and if you can run a successful business, you get the benefit of a compounding effect of expertise and experience. And they are separate adjectives, and they are separate categories of success. And I think what most people really probably underestimate is 40 years in the oil and gas industry is a long time. 1985. I mean, a lot of our listeners aren't even 40 years old. So when you start thinking about somebody who spent their entire career in one asset, one investment, one particular sector, there's a lot of data and information that can be shared from experience as well as expertise. And that's really what I think most investors may a little bit under calculate as far as value add from my perspective. But I think that's one of the things that really adds to our confidence is that we've just seen it for 40 plus years and, and that's why we've had so much fun introducing this asset class to investors.

Now a lot of people have probably seen your interviews or heard your interviews with me, but let's, let's take a few minutes just to reintroduce people to concept of mineral rights. What are mineral rights? And how can physicians, high net worth individuals like our community invest in it to create cash flow for themselves to help them ultimately get closer to where they want to be?

Well, mineral rights are pretty simple. It, it's true real estate. So in the United States you have three rights. When you own real estate, you own the surface rights, which most of us are familiar with, right. Then you have air rights, anything above your real estate, but not attached to the surface, and then you have mineral rights. Well, mineral rights is all the natural resources below the surface except for water. And so what has happened is that as we become a more natural resource driven economy, you know, we nickel, lithium, copper, oil and gas, certain geological areas in the country just happen to have it. There's gold in Nevada, there's silver in Southern California, et cetera. Oil and gas is really prevalent in about, you know, 25 states. But because of technology, they've identified it in really nine different buried huge deposits of oil and gas. So mill rights have been around forever. The problem with mineral rights is it was never a individual investment asset class because it was throw the dart. Hope you were lucky. Drill the well where you owned your mineral rights and maybe you made money, maybe you didn't. Too risky, too speculative. Nobody wanted to do it. It was only for really geologists, oil and gas companies that had the leading edge because of technology, kind of the same technology and that made Tesla where it's at today. Technology helps these individuals drill wells in the greatest, latest state of technology, like sending spaceships to, you know, NASA uses. But now you're drilling in these huge buried basins where you're hitting 99 of all your wells. You don't worry about dry holes. And so that technology may buy mineral rights mainstream. No longer is it that Hoping you hit the dart. Now it's just how do I buy the right mineral rights at the right price with the right oil company to get the maximum value. So it's more of a strategic play than a guy close your eyes and pin the tail on the donkey kind of game. That was 20 years ago.

However, today it's still seen as, again with our audience, I'm sure, or just people out there still seen as risky. And it's probably something that you've worked really hard to educate people on. Yeah, but what else like causes that, that kind of sensation or that feeling for people that it's still risky? I think it's not just the actual, like where you think of oils and, and drilling. I think a lot of it has to do with also finding out who to invest with and the operators and that being risky as well. Can you talk a little bit about that?

Well, I think you hit the nail on the head. To be candid with you, I don't trust anybody. It's really weird. I give virtually no referrals and I'm extremely careful who I invest with. I'm very hard to sell investments to because I had my own investment firm for 22 years and I used to have Wall street and all these guys come and say, hey, would your brokerage firm raise money for this? And I'd start digging into the due diligence. And then like you, I started asking the tough questions and it was, you know, chirp sound, birds, no. No noise, no answers, no results. And so because of that 22 years of running an investment firm, I'm extremely jaundice. So I flipped that script and I said, okay, I got this large 20 million millionaires in the U.S. many of them would love to be in oil and gas, they'd love to invest in minerals, but my God, who do I talk to? Who do I trust? There's not a website I know to go minerals one on one or oil and gas. The truth. And so the problem is it's a very obscure. Now your, your level of risk is extremely high because of the who factor and the promoters, the liars, crooks, cheats and thieves, they know that. So they play off of the greed and they play off of the tax write off. And they play off the obscurity by saying, oh, you know, you make a lot of money. Put fifty thousand, a hundred thousand here. And the reality is you might as well give it to the guy that's homeless on the corner because they're never intending on drilling well or making you money. So I remember when I first started my career, it was right after the big oil crash in the early 1980s, after the oil embargo. And I would call people on the phone, Peter, and I'd say, hey, I'm Troy. I'm in Dallas. I work for this firm. We want to drill oil and gas wells. And their answer would be is like, who the hell are you? And why do I trust you? And, you know, I've already been in 10 bad deals. And I go, what kind of business have I got into? This is horrible. And so when I grew up, your handshake was a contract. Your dad's word was better than anything he could write. That's how I was raised. So I thought, why are people so distrusting? Then about five or 10 years later, I go, oh, my God, these people are stealing money and lying. And I had a guy used to slam his desk door. And I go, what are you doing? He goes, I'm making it sound like a pump jack. So the guy thinks I'm out at the well side. I go, what? And so I quickly said, I can't do this business. So I ended up starting my own brokerage firm. I ended up eventually starting my own oil company. I said, I have to have full confidence what I'm asking people to invest in. I can see it, touch it, kick if you. I'm going to go to that rig, I'm going to go to that location. And so you're right. It's the who. The problem is most investors, no offense to anybody, are lazy. They don't ask tough questions. They don't go to conferences, they don't come to PIMD and go, I'm listening to every single workshop whether I invest or not. Because the more I know, the more I know what I don't want to invest in, the more people I know, the more people have been with X, Y and Z, oil company or investor or real estate. Go, bad guy, bad guy. Great company. You've got to be a very proactive investor today to know who the who is. You have to be. You got to get to that PMD conference. You got to get involved in kind of podcasts like this, because absent that, you're really just throwing a dart, hoping, I guess, the right person. That's the fastest way to lose your.

Net worth when it comes to due diligence. Then what are some questions that people should ask you? Like, in that. In that space, just to know that they can trust you in that space. Like whether they ask you or ask the next Person. Like, what's that magic question? Or is there a magic question that somebody should ask you to know that they can trust you and what you've done?

You ready? You're gonna find this funny, but here's the first question I ask people. What's in it for you? And they're like, huh, selling me multi family investments, self storage. I get investments all over the place, right? And I always go, so you're selling mineral rights. They're so good. Why do you sell them and not keep them? I want to know the motive, right? And so the answer has to be something that is believable, credible and viable, right? Because if they're so darn good, sell everything. You got your watch, go buy minerals, cash flow, and don't tell me about your secret. It's kind of like the people who write books about gambling in Vegas. If you know all the answers on how to gamble blackjack, why the hell you write the book? You just go make money at blackjack and never talk to me. So I think the key issue is, number one is I want to know who, but I want to know what the motivation is behind who. Why are you doing it? What's your game? What is the ultimate goal for you? Because if you as a company promoter, sponsor are not making money, you're not going to make me money. Because you're first. You're the eye is always first, right? So after I established a motive like, oh, I buy minerals. I sell part of what I buy because then my minerals cost cheaper because I use the fee I charge you to get me the very best minerals that I can't buy with my own money, but I'm a part of those great minerals. But I get to have my bases lower because I charge you a fee. Oh, that makes sense. Okay, great. You're like the five star chef. I sell great meals so I can make enough money to eat great meals. That's. That's okay, I get that. The question is, is it fair enough? So that's the second question, which is, okay, I understand your motivation, but if your motivation is to make a fee, how do I know that's not the only motivation is to make fee? Because most sponsors, they just want to sell deals and make those fees. And the carnage and the bad results and the bad news is horrif, because they had nothing at risk. No skin in the game. So the way Eckard has done it is we go out and buy the minerals. I pay for them with my money. I own them. They're titled in my Name. And I say, okay, here's a $20 million package. I'm keeping $4 million of this package and I'm offering 16 million for sale. Two key things are important. 99 of most sponsors, 99% of most sponsors do not own the asset they're selling you. They need your money to close on it. So they can't make the fee, they can't close in the deal. They're scared to put up the deposit. They're scared to put up the money because they're, what if I can't raise the money, I'm going to lose my money. I took the opposite approach. I said, what would Troy want? Well, Troy wants to invest with people who are confident, who have capital to spend. You're willing to take the risk. You're skin in the game and we're going to ride this pony together. If it's a winner, we're both winners. If it's a loser, we're both losers. But I want to know the guy I'm investing with is front facing, just like you handle your investments. You're sitting there front and center saying, I'm Peter Kim, this is my deal. I am the end all, be all to what I offer. You and I are rare ducks. We do the right thing. But most sponsors put on this facade and they get on these zooms and videos and at the end of the day, they have no money in it, they have no back office, they have no support. But man, they can sure lie through their teeth like no tomorrow. So I want to know your motive and I want to know you have skin in the game. And last but not least, tell me that you've been doing it longer than the last five year cycle. You know, chairs don't even last five years. So how do I know you at 34 years old can tell me what the next three cycles are. You know you've been through a bad cycle, yet I gotta know that you've been around the block enough to know when you should take a left or when you should take a right or when you should hit the brakes. If you've never been there, you literally take a major risk. And it's not because of integrity. It's you don't know. What you don't know is around the corner if you've never been there. It takes expertise and experience. Now that sucked when I was a kid. I'm telling guys at 22, 23, hey, you gotta trust me. Invest in one guy, it's like, my grandkids are older than you. Buddy. I go, I know, but do your grandkids have any money? And they're like, that's funny. You're a funny guy. Go, I'm a funny guy, but how the hell am I going to get experience if you don't trust me? They're like, I don't know, find somebody else who's got more money than me because I can't trust you. It was a tough battle the first 10 or 20 years because I was so young, had so little experience, and after I finally got there, now all of a sudden people go, now I know he's got experience. He's got the gray hair, he's got the scars in the face. He's the older guy. Hopefully he's an older guy because he's had the experience. And he doesn't look like he's got handcuff marks, which means he hasn't been to jail. That's a good sign.

You know, those are all great questions for anybody that's listening. You need to ask those questions of anybody that you're investing with. It's not just mineral rights. That's for family. Anything else that you're asking, you should be asking these questions of everybody that you're considering investing with. Hi, everyone. I'm super excited to tell you about PIMDCON, the Physician Real Estate and Entrepreneurship Conference happening on September 26th through 28th this year, 2024. As always, we're bringing together some of the smartest minds in real estate, investing and entrepreneurship live to speak at the event. Now, I've been to a ton of other conferences, but what really sets this conference apart from other conferences? This is totally intention. It goes way beyond the speakers. It's being part of the community that's created. At our live events, we have different tracks focused on real estate, investing or entrepreneurship, so you can customize your experience and focus on what matters to you the most. We have a ton of expert speakers, we have panelists, we have workshops and masterminds that will help you gain the knowledge and confidence you need to take your next step towards achieving financial success and independence way beyond medicine.

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And it's not just about the information you're going to learn from the speakers. It's about the conversations you're going to have with other attendees that I know will spark new ideas and inspire you to take action. Every single year, people leave our conference behindcon and they launch their real estate investing careers, while others grow their portfolio or expand their entrepreneurial ventures in really incredible ways. Even in ways that none of us would have imagined. So this year will be no different as you leverage your big ideas to expand your vision for what's possible. You just have to show up. We're so excited to announce a new location for our annual event. We're doing it different this year. We're also offering in person specials and tickets, especially if you're getting your tickets early. So join us in person this year in Dallas, Texas, the middle of the country, so everyone can make it on September 26th through 28th. Just so you know, there's a virtual option for those who can't join live. So don't miss out on this opportunity to connect with a community of like minded Internet individuals and gain practical skills and knowledge to help achieve your financial goals. I'm excited to see you there. Click the link below to learn more. I'll see you there. Now the other part that Troy, I think that people have questions about when it comes to mineral rights. And this quote unquote risky aspect of it is this thing with fluctuating prices with oil. I think a lot of us don't really understand what that means except we see it at the pump. Like when we go to, you know, get, get gasoline for our cars. Like you see oil, the price of oil, they talk about a ton in the, in the news that it goes up, it goes down, it goes up, it goes down. How does that impact mineral rights investments, like with you? And like how does it, how do you think about that? How do you sleep at night knowing those things go up and down?

See, I, I think the idea is it's probably no different than if you had a cancer, right? You get diagnosed, you got cancer, the oncologist, your doctor tells you, hey, here's what I see, here's the prediction of what's going to happen. You're gonna have good days, you're gonna have bad days, it's gonna go up and it's gonna go down, right? So I'm trying to put it in medical terms. What I learned very early on is that the, the amount of information between what's produced at a wellhead out in the field in Oklahoma and you putting gas, your pump, that, that trail from that barrel being produced well to your car is a massive, massive chain of different events that take place. So we could be paid $70 a barrel in the field. Your net price per gallon puts it like $250 a barrel. Because everybody that collects it and ships it and processes it and refines it and ships it by to the gas company and the gas producer, it's a massive chain. Right. So the average investor's expectation of oil and gas investments is what they see and what they know. I don't know what I don't know. Right. I think the key is, is that if you're an investor who says, I want a solid asset, I want something I can see, touch, kick and feel, I want a true piece of real estate, a true commodity, I want to own it. But tell me what I see in the marketplace and what's really happening in the field where it's my mental. Right. So the way I tell people is, look, if you went to a 12 round boxing match and you try to gauge month by month your production, that doesn't mean a month is around. That means you're going punch by punch. January, February, March, April. Right. February has 10 less days. So when we get paid for February's production in late April, it's automatically down 10%. Even if the well produced the same amount at the same dollar price, there's 10% less days. So you automatically have to start relating time and production. People think, wait, the well is doing 500 barrels a day. What's not making 500 barrels equally over 24 hours, it might surge and make 300 barrels in the first six hours and then it might take a while to make the other 200 barrels. There are so many factors. So how you asked me, how I get through it, the way I get through it is this. I look at oil and gas like an income producing traditional piece of real estate. A rental home, an apartment complex, a shopping center, retail center. I say, okay, I got essentially a five year financial model over five years, okay, and 60 months, 60 different individual distributions. We distribute every month. I'm going to see a fluctuation in price, a fluctuation in my check, fluctuation in production. War breaks out In Russia, it's 129 a barrel. Everybody settles down at $70 a barrel. What the heck? We did that this morning, by the way, Peter. We said, what's the range of oil prices? We started buying minerals in 2019. I said, well, it was negative 37 on one trading day and 129, that's $150 swing in the last 40 months. Right. Natural gas is almost as bad. It's been as low as A$65 for a thousand cubic feet up to almost $15 because of the Russian war. So if you put that in a model and said, here's my spread, you'd be like, well, just show me what it's going to do. Well, for these six months, we got paid almost double our value. For these four months, we got paid 75 cents on the dollar. Investors have a tendency to like simplicity. They like accountability. Like, I put my money in a debt fund and every, Every quarter I get paid 10 per annum. It's simple. That's good, except for one thing. It's not an asset. You actually are giving somebody money to borrow. They're promising to pay you back at Equal Instruments, and you hope the collateral is good. You hope the word of faith is good and there's no upside. Some people like that. Some people prefer to have real ownership and they can deal with the fluctuation. So I look at it like a boxing match, like I said. I say, look, I just want to go round by round. What does that mean? I'm not worried about January, December 31st, but I do want to see what I made this year compared to last year. I do want to see what the model set I would make and see if I'm on track. And you know how we do that here at Eck, we track it all the time. And all I want to know is, is the person driving the ship, the energy ship at Eckerd, do they know what the hell they're doing? Are they right? Are they close to being right? Are there any deficiencies? You know, where is the car going to run off the road? Those are the questions that investors don't ask. How could this fail? How could Troy be wrong? How could Troy manipulate the data to make it look good? So I buy, and it's based on a bunch of false narratives. That's the kind of questions I'd be asking.

Well, do you mind if we ask some of that right now? I mean, go ahead. Set me up for it.

I think a great question.

What keeps you up at night then, about these investments? I mean, is it the regulation, you know, potential regulation changes? Is it the, you know, the shift towards renewable energy? Do any of those things kind of phase you and, like, what. What could go wrong that you worry about?

No. I would liken this to be in like a. Maybe a chemist who's discovered the new type of chemical properties that's going to solve some kind of medical issue or solve kind of some kind of problem. And this is can. This is not a sales piece. This is. This is true. You asked me, you put me in lie detector. I'm going to tell you what is. I've waited 40 years of my career for the opportunity I've been involved in the last four or five years. To finally own energy assets where I wasn't worried about loss of capital. I wasn't worried about dry holes. I wasn't worried about not making a great return. It was finally owning assets that work 99 of the time, right? Owning assets that nobody can send me a bill or cash colony or liability or well, blowout. And what keeps me up at night, this is 100%. Put electric prod in my ear and shock me if I lie. Here we go. Ready? I don't know how to get the message across to investors. I don't want to sound like a sales pitch. I mean, don't get me wrong, I can sell you a glass of water while you're drowning in the deep end of a pool. I'm articulate, I'm intelligent, I'm experienced. I know what it takes for people to want to invest. Put that aside. And that's what I'm answering is, it really drives me nuts going, I don't think these investors understand how good this is. And this is probably a chance of a lifetime. Because as Exxon buys Pioneer and Marathon gets bought by Conoco and all these guys are buying each other out, the opportunity for individual investors to get in and buy these minerals is shrinking daily. And whatever you own, you will own real estate in the largest oil and gas basin in the country. And your only other investing partners are multi billion dollar companies who are drilling the wells for us for free. And they own everything else. Man, is that the playground I want to be in. So what keeps me up at night is I'm like, I'm not saying the message right. I'm not getting my message across. I don't think they understand it. And you and me, I could sit down, I could get so technical, you'd be like, oh my God, he's born me to tears. I've shot my own size. I've been in rooms with major oil companies with five, 10 geologists. I mean, I have probably drilled and been involved in over 5 million foot of vertical horizontal wells in my career. We own 8,000 wells in inventory. So I could bore you to tears. And I go, okay, Troy, nobody cares. Shut up, stop talking. Go to the center point, which is if you want to make 10% on average over five years or higher, and on a piece of real estate that'll produce 25 to 75 years of income. There's nothing else. Like in this asset class. You can ask a thousand questions, but it's really simple. Do you have money that you want to buy? Real estate that makes you monthly income at 10% plus return a year over 25 to 75 years that in 10 years may not be able to be obtained. That's really the simple answer.

Obviously, we're in a crazy political environment right now. Lots of things are going back and forth, the elections coming up, and you're going to hear a lot about renewable energy and the shift towards that and pipelines and things like that. Does that not concern you or worry you about where the future of energy is headed, especially in this country?

Yeah, I think it concerns me deeply, but it concerns me maybe from a little different perspective. What concerns me whether Kamala Harris wins or Trump wins, what bothers me is that no one truly understands that literally 75% of every product made this country comes from a barrel oil. We always focus on transportation or utilities, right? The wind energy, the solar energy, the electricity, the highways And Teslas and EVs, that's, that's all great because it's visible, but everything in this screen behind me, my shirt, my watch, the carpet, your shirt, it's all made from oil and gas. So no matter what we do, you're always going to have fossil fuel. It's the most abundant, accessible, cheapest energy we have. It truly is. So even if we have a truly a political party who truly says, hey, we're going to save the planet, take care of the environment, we want to get rid of fossil fuel, we hate coal. Trust me, I don't buy straws or lids. I mean, I'm out of my house, I'm collecting plastic bottles everywhere. I hate them. I don't buy them. Why is that? I believe we do need an alternative here. I do believe we need to be more green. We need to take care of the planet. I get it. But then there's a practical side that says if we don't have cheap energy processed, refined, delivered, and managed in the most environmentally friendly way, we destroy our planet. But since we have it, let's figure out how to do it most prudently. Let's figure out, do it most environmentally friendly. When you look at these oil companies these days, I mean, I remember Wells 20 years ago. You walk on, there'd be oil on the ground. They didn't care. They're slinging chain. You're like, wow, this is a, this is a zoo. You go out there now, good luck finding a drop of oil. Good luck finding anything out of place. Because they're under such a scrutinizing eye these days, these major oil companies are spending billions of dollars on properly ventilating Gas and oil and collection, and everything's done with solar panels. They actually have solar panels, Peter, on every well that says all the readings are going out on disposition of carbon and collection and everything going back to computers in Houston saying, this is what our report is. There's no more hiding the monkey anymore. It is the most exposed industry in the world right now. So when I look at environmental and regulation, this is what scares me. The more they press on that the higher oil and gas prices are going to go. Because what's happening is we've had massive increase in demand as the population has grown. We brought manufacturing back into the US and continue to do so. Our demand is increasing. We absolutely have not enough oil and gas in this country. So we have to import dirty oil and gas from opec, Russia and Venezuela in replacement of our good oil and gas that's clean that we have to export because we can't refine it. So what scares me the most, every time they added regulations, it raises the barrier to entry. The barrier entry raises the price oil and gas. And that hurts the economy and it hurts the average American mom and dad. My mom is a single mom raising four kids. She can't pay $5 a gallon. She can't pay electric bills like they are. So you're destroying the fundamentals of the American people by virtue of economic preference. That's what worries me most about what regulations are taking place.

Yeah, that's really interesting. You shared a lot of points that a lot of people don't think about. I mean, again, I think you were the one that show me that I always think of oil and gas as terms of gas in the car. But, yeah, I mean, thinking about it creates everything here. It's actually true.

I mean, there's a video. There's a video, Peter, I got to send it to you. I think I've seen it once before, but it shows a guy walking into a house, and all of a sudden they say, pretend he's in his house with no oil and gas. Next, you know, his chair disappears, his glasses are gone, his paper's gone, everything. He walks out of the house basically in his boxer shorts. The house just disintegrates going, these are everything that's made with oil and gas. He's pretty much standing in his front lawn. And the key thing is, from an investor's perspective, let's say you are totally 100% environmentally friendly. Let's say you totally believe fossil fuels are the devil's work. That's okay. That's extreme, right? Then you have a choice to make. Wouldn't you invest in minerals, which is the substance that starts the origin of oil and gas, knowing that only the real major oil and gas companies who have this really heightened environmental attention, the Exxons, the Chevrons, the Oxys, it's the biggest of the biggest and they're the ones that are drilling the new wells and they're dealing with premium environmental considerations. Right? By being a mineral owner, I get to be at the headwaters owning those minerals. I get to benefit financially, but I also get to do it knowing that the very best oil companies in the world are drilling it. That's why everybody hires us. And what's really happening, the mom and pop and the Willie Joe with a prop up rig that has oil flyer, they're all gone, they're disappeared. All the small fries are gone, gone, gone, gone. This is the cleanest the oil and gas industry has been in my career. And it's unbelievable, these locations and how much they pay attention. They all have HR people, environmentalists and environmental engineering on every single location. So I see a huge change as a result of the pressure. But I also want to make money as an investor. And if I want to invest without promoting oil and gas, I'm gonna vet from a fish farm. I can't invest in Tesla. 100 of that car is made from oil and gas. That electricity about 85 comes from natural gas or coal. For me to truly be a adamant environmental sensitive investor, there's a practical point of saying how can I invest but do it in the best way? It may or may not be direct oil and gas, but I like to know that I'm Exxon's landlord and they owe me money and I want Exxon to develop my natural resources in the right way. That's what I think is kind of cool. I am Exxon's landlord on the minerals I own.

I think like you. I mean currently I invest in mineral rights, but I also invest in some sustainable energy because I think that's really important too. As demand has gone up, we, we need to figure out ways there to obviously harness technology and do better in that space too. So I've kind of blanketed the market investing in both. So that's the way, that's the approach that I've taken personally. And so I think you, you've helped me kind of figure out how to best do that. The one thing you mentioned here about Exxon and the bigger companies owning that, why don't they own all of the land at this point? Like why Is there even an opportunity for investors like us to have that opportunity? I mean, again, you're dealing with billion dollar companies. Why don't they just own everything?

Well, for one reason, a lot of mineral owners will not sell. They'd much rather be the landlord. They have no interest in selling. So you probably have billionaire real estate holders all around the country that never intend on selling their buildings, right? New York, Times Square, all that kind of stuff, right? But there's really a food chain in oil and gas, just like in traditional real estate. There are land developers who like to buy raw land, entail it, annex it, turn it into a multi purpose use facility. Those are what I call front leading, highest risk taking real estate investors taking raw land and converting it, right? Then you get the developer says, well, I'm gonna put a big box Home Depot here, wrap it with some retail, put in a Chick Fil a well that's more your developer type who's taking it, breaking it up into price per square foot versus price per acre. But they're going to pay all that entitlement costs, the utilities, electricity, the fiber, the highways, the parking lots and sidewalks, right? And then you have the end user, which is the retail customer, and these are the reaches, say, I just want it all filled up and give me the rent every, every month. Oil and gas, the same way you have exploration companies. All they want to do is take every dollar and they want to own 75 to 80% of the revenue by going and drilling the wells. And they look at mineral owners and go, okay, we're going to patch in the head. Troy and Peter, you guys milling the minerals. We'll give you your little 18 to 20%. Y' all just shut up and sit back. We're going to go drill $150 million worth of wells on your property and we'll send you your check every month for the next 50 years. But we want 80% of that because here's why. They'll go put $100 million and go drill 10 wells. And those wells will pay out in 18 to 24 months. And they can rotate that $100 million again and again and again. And they end up with 8,000 wells with a 25 to 100 year well life. And those reserves in the ground just grow that balance sheet. Because every year that well might only produce 8 or 9% of the reserves in place. And that's why Exxon keeps growing. Each well they drill is measured in cash flow annually. But they just found 25 to 100 years worth of reserves. In the ground, which if you look at history is going to be worth double, triple, quadruple the value 5, 10, 20 years. So exploration companies, they're the developers, right? The downstream, the REITs of the retail buyers. That's the refineries, the valeros, the kinder Morgans with the gas. You and I, we own it all. They just lease it from us and they go spend all the money and drill it. So the absolute safest place in oil and gas is a mineral. The absolute greatest opportunity for return forever is a mineral. One well producing at 70 barrels a day, that's okay, if all goes to 90, I got one will make a 90, $90 a barrel per day, right? But if I end up having five, six, eight wells, and I got eight wells making 500 barrels a day at $70, that makes me about four to five times as much money. I'm not so worried about commodity prices at the same time because they own the minerals. I don't even know they're drilling half the time. Half the time a check shows up, man. I was getting a check from Continental resources for like five years, making $300 a month about eight months ago. The check is like $13,000. Like, what the heck is this for? So I start doing some research, get online, my subscription. I go, oh, they drilled eight wells, know about. I'm still making three or four thousand dollars a month. And these are minerals I've owned for 20 years. Mineral owners get their share of every drop of oil and molecular gas. But there is a definite food chain. And I like being at the beginning of the food chain. I want to be above debt, above liability, and I want to get paid first. I'm not a pig, but I like being a little lazy, but not having to work for my money.

I mean, when somebody invests in this and you talk about the long lifespan of these investments, tell me about, you know, what would you say to people when they say, hey, if I invest in this now again, how long is my money locked up or my investment locked up? And is that okay, there's a concern there or that, you know, you invest in something that is eventually that, you know, is it going to run out? So it's not like a, you know, sustainable type investment, like eventually will run out. Like, how do you deal with people who ask you that question?

So let's take traditional real estate, whatever real estate you're buying, commercial building, retail. It's got a depreciation life expectancy according to the irs. Once I depreciate that cost basis I'm trying to sell it because there's no depreciation. So there is an economic, I think an economic premise around real estate as well. Right. Oil and gas has individual wells that are drilled like straws in a coke. That straw is only going to get so much oil and gas out of that one well because it only can express itself or be exposed to the reservoir with that single well. So the minerals we buy, we're looking for multiple formations. 3, 4, 5, 10 formations, which means we have like, it's almost like a 12 pack of Coke. Right. We have 12 different reservoirs to produce five, four different reservoirs produce. And there might be three, four, eight, 20 straws per reservoir, but they're not going to drill them all today. So we buy minerals based on immediate cash flow. And what we see is determined, hey, these are the next five straws. They're going to drill wells over the next 36 or 60 months. So our entire economic premise is based on what we know today. But from a true oil and gas analysis, we go, yeah, but Zone 1 should hold six wells at today's commodity prices. If prices go to a hundred dollars a barrel in five or 10 years, you can add two more wells. So there are mineral owners in West Texas that were told back in the 1910s, your wells the last five or six years, they still have producing wells 75 to 100 years later. Those wells lasted that long because now they're getting paid not a dollar a barrel, they're getting paid $70 a barrel and that's 70 times the value. So I think what really investors need to think about only gas. It's kind of two people. I'm investing on the gas because it's the right investment for today. I like the income, but maybe I want to liquidate in seven years. I want to buy a lake house or switch or my health goes bad or I get a divorce. So we created on our own app, which you've seen Eckerd Insights, what we call P2P, partner to partner. And we had a lot of partners in financial trouble. We've had some divorces, a couple of deaths unfortunately. But we created the market because we wanted to show people, look, if you're in 5, 10, 15 portfolios and you want to go buy a rent house, you want to buy a lake house, well, go put three or four your portfolios online, list your price, whatever you want. You got 2, 000 hungry millionaire buying investors of Ecker that jump on and buy it. I personally Peter been buying minerals on that line site for My own personal family account. I like what I own. I buy more of it for my own personal account. But let's just say hypothetically, you don't need to sell. Let's say you make all your money back. We've had several portfolios already pay out 100% in under five years. So you invest 100,000, you get 100,000 back in five years. You'll. Should I sell it? Should I not sell it? No. Holding costs, cash flow every month, all the reserves in the ground, technology, improving it. I have a lot more wells. Why would I want to go sell that? But if you need to, you can do P2P. Now the other side is in Eckerd. We're always looking at a way, what we call aggregation. There's going to be a point we might put together like an income fund and say, okay, we're buying minerals from these different portfolios because we want an income fund, because investors want to make an 8, 9, 10% will create that liquidity event. And we'll allow you, if you choose to, to sell your minerals into that fund. Why are we doing that? Well, there's a lot of people who don't want to own minerals. They just want income. It's a great fun for them. And then somebody like you and me go, hey, we just found a great retail center. Peter, you and I are going to go put a million dollars in it. Let's go sell 500 grand of our minerals and use that cash in a 1031 exchange. 1031 out of minerals into that building and that's paid for from our mineral sales. I like that.

Well, it's good to hear there's some liquidity options. You guys have thought through this. I'm sure people have always asked you about that. So it's interesting that you've been thoughtful and create a solution for that now. You know, investing in middle rise often like people are, you know, for a lot of people, they've been hearing what you've been saying for a while. So, you know, every time they hear you, they get a little bit more educated on the topic. There are other people that are brand new to this and feels like a little bit of a black box in terms of understanding what it's about and ultimately how people make money. How do you ensure that there's transparency, like throughout this entire process so that when people are investors with you, they know exactly what's going on with their, you know, what they own, how much is coming out of there, like what's actually happening with the Investment, because that could be sometimes the hardest thing with some of these type investments to understand what's going on. So how do you make sure there's transparency there for the investor?

So when we started this, I always take the position, what is, what would Troy want? And I'm a tough customer to please. I mean I, I'm a hands on kind of person. So if you and I bought an apartment complex, I'd probably be knocking on doors and asking tenants so what they call thought of the neighborhood and I'd be checking out the parking garage. So having that kind of personality, I said, all right, if we're going to ask sophisticated investors to invest in mineral rights, we're an obscure investment asset class. How do we make it more mainstream? So we built the Eckerd Insights app. Now, the reason why the app is important is because we scrape data from the Oklahoma or Texas tax office. That tax office gets reports from the oil buyer, the gas buyer, the Valeros, the Exxons who buy the only gas, and it shows the volume that they bought. We then look at that volume and we put it on our app. We say, hey, here's all your 8,000 wells. Here's what every well produced last month in oil, gas, natural gas liquids. Then we get the checks in from the oil companies that are operating the wells we have on and we can cross check the volumes from the oil company that paid us the check versus what's in the tax office. All of that information is online on the app. So let's say I'm a new investor. I say, okay, Troy, I trust you. I'm going to put in a hundred ousand, the next four portfolios. Great. The minute you invest, we give you your own account, we upload you access to the app and like within a day you get all your minerals, all your deeds, all your ownership shows where to court in the courthouse. And then as soon as those wells come in, you start seeing all your production, all your days turn on every technical piece of data. You want that well just like you were a miniature exile. And the reason I do that is this. Not say that I'm going to steal your money. Let's say I get hit by a bus tomorrow. I want each one of you to know exactly what you own, 24, 7. Because I want to make sure it's transparent, it's accessible and it's open. And the more I make transparent, the more accessible, the more I train and educate you, the more comfortable you're going to be investing in this asset class. And at the end of the day. What I want is I want to surround myself with smart, sophisticated investors who have long term investment plans and say, this is part of that cornerstone of my portfolio. I want to invest with Troy because of experience. I want his access to his data. I want to see consistency. I want my checks every month. And guess what? If I don't want to talk to him for six months, there's no decision, no cash calls. Just send my check to the Bahamas because that's where I'm hanging the out in at the beach. That's why it's the most passive income investment asset there is out there in the world. Because I don't have to say a thing. Just send me my check every month. It's fun.

I mean, you said you work with 2,000 investors and you know I understand investments pretty well. Both has limited partner and also running some deals. It's impossible to make every single person happy. There must be some unhappy investor out there who's been in your world or maybe didn't meet expectations. What was the reason for that?

So here's how I feel about life. So I've been handling investments for 40, going on 41 years with accredited investors. I'm gonna say this without because it applies to me too. People are successful, are super eccentric. We're all weirdos. We all have our idiosyncrasies. We have our different things. We. Like when I walk to restaurant, my wife says, he ain't sitting at that table. He doesn't sit by the tea, the tea booth, or the bathroom. He sits by the front door. We're all weirdos, right? And what happens is people have selective hearing. I. I'm horrible. I go into a furniture store and I'm thinking about this, that and the other. My brain's going this way. I go, I thought you said that couch was 3200. No, sir, I said it was 6200. No, you said 3200 just to get me back. No, sir, I said six. So people have a tendency to hear what they want to hear. The other thing is we're getting one small slice of their portfolio. So I've got a couple of really good clients right now. They're in like 10, 20, 30 portfolios, and a couple of them are online selling their portfolio. So I asked one of them yesterday, I said, what are you doing selling your portfolios? These things are your best assets. He goes, all right, I'll just tell you the truth. I took out three or four loans. I bought a condo, sold my practice, this, what I'm doing was expecting a second big chunk of money from whoever bought my practice. They can't pay me. I'm way over levered. I got high loans, I'm getting crunched. I'm squeezed. I got to go sell my very best assets because that's all anybody's buying these days, is the best real estate, the best minerals, etc. So I got to sell what I have as my best asset, and that's your minerals. I hate to do it. I have no choice. The other guy said basically the same thing. So people went out spending money like a bunch of drunk sailors the last four years, and now they got loans and debt. And then a lot of people who owed money through debt funds or through buyouts are finding out they're not getting paid off. The squeeze is on. And I saw this back in 2008. But to be candid, I think here's one of the issues. I'm extremely blunt person. You either like me or you don't. I find very middle are kind of neutral. You're either like, okay, he's brash. He says it like it is. He'd be loud. He never shuts up. He does 100 videos a day. But, but there's something about that guy I like. The other 10 or 20% go. Every time he talks, I want to punch him in the face. And so there is a, there is a relationship drive, there is a expectation drive. And then, let's face it, if every portfolio I had was doing what it was designed to do, even if you hated my face, you'd be in every portfolio, because Troy's got a perfect track record. I've got maybe 15 to 20% of our portfolios that are running behind schedule, not generating as much cash the last 18 months because commodity prices have been down and the company's drilling didn't drill as fast as we thought, right? So you take a look at the first 2/3 or 75% of our portfolios the last five years, they think we walk on water. You get to the last 12 months and there's like 300, I'm going like, what the hell? We're not getting as much money as we thought. And you know, that is not as good as he says he is. But if you look at our history, those portfolios catch up, they make money. But I promise you, Peter, I never get that phone call going, all right, I hated your guts last year, but now you're my, you're my favorite guy way. You never get the good. Cause you only get the bad calls and I, you know, I'll be candid with you. I'm a, I know people think I'm a real hard butt, but I'm super sensitive. I never want to let anybody down. I don't. I work relentlessly trying to figure out how to make everything I put you in work. I will go back and tell my team, hey, this portfolio is running behind. Maybe we should switch minerals. I'll buy those minerals back. Let's put these minerals in there or let's take this client who overloaded in this portfolio. It's not doing as well. Let's see if we can switch him to UP minerals and I don't have to do that. But why am I doing that? If you want to truly invest with somebody and you truly want to be their partner or long term investor, the sponsor has the same obligation to figure out if this were all my money, how would I move it around to maximize the return? Well, it is all my money. Your money, Peter, the client's money. It is my money because you're my bank. And if I don't make you the money you want, you're not going to invest me in the future. That's really how I work behind the scenes. I'm an intense guy. I'm probably on the. I'm probably, I got this morning up at like 5 o'. Clock. I'll probably go to bed at midnight. I don't sleep much. I don't need much sleep. I don't ever slow down. This. I talk at 12 o' clock at night, drive my wife crazy. But it's passion, it's the desire to be perfect, it's a desire to perform because my greatest satisfaction is making you a ton of money. It really is. How hard is it to sell you a new investment? I'm kicking the ball through the goal post and I'm making you all your returns and more. And I go, hey Peter, I got another portfolio. Yeah, count me in. These sponsors don't get it. Just do your job and perform. The money will find you. And they don't get that. Awesome.

Well, well, Troy, I think this has been one of probably our most fun conversations that we've had. I had to just ask you some of the harder questions that people have been asking me and I said, go talk to Troy. You know, whether it's person at PIMDCON or I know they can call you and your team and you guys are, they're there to answer all of these questions. And again I recommend to people, people have been asking you know these questions for a while, go ahead and ask. As their team, I think you'll find they're an open book. Ultimately only invest if you have confidence.

We create ebook after ebook on every topic that we think is relative important. We have personalized financial elite member club meetings where we invite 25, 30, 50 of our best clients to come in and talk about life and insurance and annuities and stuff. We have our annual conferences that come out every year, a VIP conference. Now I'm not doing that for a promotion. I'm doing this to say an example. One of the things you asked the very beginning, what's those first questions you should be asking about making an investment. And here's what I'm going to say. Will you allow me to meet and talk to your other investors? I don't need their personal information. I know privacy, I can't do that. But will you let me in the same room with 5, 10, 20, 50, 100 year investors? And I think really most of my investors underestimate that value because why? You get in a room with a bunch of people that made investments, they're all thinking this guy's a liar or a salesman's a liar or secretary's a liar. We don't know. We're going to find out. But when we're done, we're going to hang that guy like a pinata to beat the stuffing out of him. We're going to find out he's a real deal. What I've always liked about you and I've liked about the way our relationship is, you run your business like I do your hands on. And I see you at PIMD, I'm like, dude, that guy is going to lose 10 pounds this week because he's running 150 miles an hour. You say hi to everybody, you make facial kind of, you are the front man. You're not just a guy doing podcast. And I say this every time we meet. What makes it so exciting working with you is you take the same approach to life I do, which is let's just do a great job, let's deliver, let's be polite, let's talk to people, let's educate them. I'm going to do really well if they do well. And that's why I love doing our podcast again. I love being around you because you're just a 20 year old, much younger in shape guy like me and probably with a lot better personality.

I doubt that. But Troy, you're great at what you do. Really enjoy these conversations all the time. Again, I know this won't be our last conversation. I'm sure more questions will come up and I'll bring them in front of you and you'll answer them like you did this time with the transparency. And you don't shy away from any the tough questions. So that's what I appreciate about you.

No problem.

So anybody's interested, Want to find out more? Just go to eckerd enterprises.com again. They've been a partner of PIMD for years now. I've been an investor with Troy for a long time, have met him, his family, his team, all of them have gone live in person to their conferences. He'll be live at our conference at pimdcon. If you have an opportunity to come, you can shake hands with them, find out, actually look him in the face and ask him these questions yourself and figure it out for yourself. Whether it makes sense or not, or if you have any other deeper interest in pursuing things with Eckerd Enterprises, you can figure it out yourself. Right. So, Troy again, I appreciate your time. I appreciate all of this. You know, keep doing what you're doing and we're excited to connect again in the future, so appreciate it. All right, take care. Talk again soon. Enjoy the show. Let me know by dropping a review in the podcast app you're listening to us in. And if you haven't already, me, make sure to hit subscribe. Join thousands of physicians who are also on this journey to creating their ideal lives through multiple streams of income. Learn more at our website, passiveincomemd.

Com.

Thanks again for allowing me to be a part of your journey. See you next time.