Redhawk Investment Group Announces Redhawk Minerals Fund II, LP

Due to new drilling technologies developed in the energy industry in recent years, investment opportunities in mineral funds are highly sought-after. Their higher yield and comparatively low risk makes mineral funds an excellent addition to a diverse portfolio.

Access to investments in mineral funds is often restricted to Wall Street-level transactions with minimum investments of $500,000 or more, which locks out all but the super-rich private investor. Redhawk Investment Group is pleased to announce the opening of Redhawk Minerals Fund II at an affordable entry level as low as $12,500 (for a limited time).

This mineral fund offering, open to accredited investors only, provides the independent-minded, non-technical, non-super-rich investor a unique opportunity to realize the cash flow and wealth generation capability  in the mineral ownership sector of the oil and gas industry.

What is Redhawk Minerals Fund II?

A strategic partnership between Redhawk Investment Group and the Mitchell Group, Redhawk Minerals Fund II targets the mineral-rich Oklahoma STACK Play. The fund is projected to raise $30 million and is priced at $50,000 per unit, with a proposed 1/4 unit investment minimum ($12,500) available for a limited time.

Similar investments are often limited to institutional investors, with average annual yields at a considerably lesser rate.  This fund represents a promising investment consideration.

• Targeted Investor IRR: 25+ percent
• Targeted Multiple on Equity: 2.7 to 3.5 X
• Targeted Investment Term: 5 years
• Open to accredited investors only.

Redhawk Minerals Fund II acquires mineral rights from one to 36 months ahead of the drill bit, and exclusively in the Oklahoma STACK Play shale formation. This fund is a near mirror image of the previous Redhawk Minerals Fund I, which closed in February 2017 at $23.5 million. Fund I is outperforming our expectations, with more than 50 wells producing on its mineral acreage and pre-drill permitting on 62 units to date.

What Makes Mineral Funds a Wise Investment?

Often limited to ultra-wealthy investors only, mineral funds have become attractive investment vehicles for a number of individuals and institutions. This is not without valid reason. Owning stakes in mineral rights can generate revenue in a variety of ways.

The initial revenue generated by ownership of mineral rights is the lease bonus, or the lucrative, upfront cash bonus paid per acre by the operator to the mineral owner for leasing him or her the rights to drill. Mineral owners then also negotiate a monthly royalty percentage, typically ranging from 12.5 percent to 25 percent of gross revenue generated by the well(s). As with any real property right, a mineral rights owner may also elect to sell his or her interests to a buyer and may will them as well.

Many investors find these multiple streams of revenue particularly appealing. This is added to the fact that, unlike in drilling investments, mineral rights ownership requires no capital expenditure for drilling or operating. Mineral rights stakes also avoid the risk of "dry hole" costs incurred by drilling investments, and as real property rights, they never expire. If so desired, your investment in mineral rights can be handed down for generations to come.

Although there is an inherent degree of risk in any investment, mineral rights can prove a low-risk energy investment when executed properly. Mineral rights investing avoids the costs associated with drilling operations, and because royalties are paid before any other deductions, oil prices would need to drop to near zero for revenue to cease.

How to Choose a Good Mineral Fund

Investment in mineral funds, when managed properly, is comparatively low-risk. When considering a potential mineral fund investment, we suggest that you evaluate it in three areas:

1. Timing. The time between the purchasing of the rights and when drilling commences impacts mineral rights investment returns. Wells are most productive in their initial years, and most mineral funds are based on mineral rights purchased well after these lucrative first years. Redhawk Minerals Fund II execution model purchases rights just in advance of drilling, and out no further than 36 months. This both reduces the purchase price and includes the wells' most productive years.
2. Expertise. The importance of investing with a company with a great deal of expertise in mineral funds cannot be overstated. The acquisition committee for Redhawk Minerals Fund II has more than 23 years of experience in selecting and valuing mineral properties, and is considered the premier group for mineral funds aggregation.
3. Location, location, location. The location of mineral rights bears the same importance as it does in real estate, which is to say, it is tremendously important. Two of the largest, most reliably productive areas for investment are the Permian Basin in Texas and the STACK Play in Oklahoma. These areas are historically high-producing, which will translate into higher revenue for the rights holder.

Choosing Where to Invest in Mineral Funds

Of the two locations that we have identified, Redhawk Minerals Fund II deals exclusively with mineral properties located in the Oklahoma STACK Play. But what is the Oklahoma STACK Play?

The Oklahoma STACK Play, located in Oklahoma's Anadarko Basin, is a large area of stacked shale zones that are incredibly rich in oil reserves and oil condensate. Drilling is far from new to this zone, but excitement has re-centered on this hot spot in recent years due to the continued success of newer horizontal drilling technologies.

Areas with wells that were once thought depleted with the use of conventional drilling technologies are producing again with horizontal wells. In fact, in some cases, horizontal wells have produced 50 percent more oil than their vertical counterparts.

​With this renewed success, drilling operations in the STACK Play are expanding rapidly. The number of rigs is increasing almost daily, with more than 100 currently in operation. Adding to the fact that the STACK Play is located near the major oil storage facilities and trading hub in Cushing, OK, it becomes easy to see why investment in oil assets in the area is so profitable. Even when oil prices are low, the lower costs associated with these ventures results in a higher ROI. That's music to any investor's ears.

How Do I Become an Accredited Investor?

You can count on Redhawk to guide you through the accreditation process to become an accredited investor. It’s a secure and simple process. According to Regulation D rules, an individual qualifies as an accredited investor if he or she meets one of the following criteria:

• One member of the household earns in excess of $200,000 in the previous two-year period, with a reasonable expectation for such earnings to continue.
• (or) With a spouse, earning in excess of $300,000 in the previous two-year period, with a reasonable expectation for such earnings to continue.
• (or) Accrue a net worth of $1,000,000, excluding equity in a primary residence.

As required by the SEC, it is incumbent upon the company with whom an investor elects to do business to verify their qualification as being accredited. Accredited status is warranted through a review of the investors' financial documentation. Documentation can include W-2s, bank or brokerage statements, tax returns or a simple form filled out by your licensed financial professional (CPA, attorney, broker-dealer, etc.). Redhawk will guide you through the process step-by-step. 
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If you are interested in learning more about how to become an accredited investor — and in the access to otherwise limited investment opportunities it provides — we encourage you to contact us at our office at any time.

Contact Redhawk Investment Group and Learn More about MIneral Fund II, LP

​If you have been considering diversifying into mineral rights, we encourage you to evaluate Redhawk Minerals Fund II or get started investing. This institutional-quality investment opportunity is uniquely positioned to allow accredited investors access to true wealth generation at an affordable, entry-level price. An exceptional return on a good oil and gas project should not be the domain only of Wall Street's super-rich. Now it can be yours.

The material herein does not constitute an offer to see nor is it a solicitation of an offer to purchase any security. Offers will only be made through a private placement memorandum to accredited investors and where permitted by law. Investments in security are not suitable for all investors who can withstand the loss of their investment. Investors should perform their own investigations before considering any investments and consult with their own legal and tax advisors. Past performance does not guarantee future results. This presentation is copyrighted material and only for the use by Redhawk Investment Group and its affiliates.

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