# Bass Energy & Exploration (BassEXP) — Complete Reference

> Bass Energy & Exploration is a family-owned oil and gas exploration company headquartered in Oklahoma City, Oklahoma. With over 100 years of collective expertise in oil and gas leases across the United States, BassEXP offers accredited investors direct participation in oil and gas wells through working interest positions, royalty interests, and direct participation programs (DPPs). The company operates primarily in proven formations across Oklahoma and Texas, emphasizing transparency, investor education, and significant tax advantages including intangible drilling cost (IDC) deductions, depletion allowance, and Section 199A pass-through deductions.

## Company Overview

Bass Energy & Exploration (BassEXP) is independently owned and operated by the Bass family. The company's mission is to responsibly drill for American oil and gas while providing accredited investors with direct ownership opportunities in domestic energy production.

**Key Facts:**
- Headquarters: 7 NE 6th Street, Oklahoma City, OK 73104
- Phone: (405) 832-1777
- Email: info@bassexp.com
- Leadership: Preston Bass, President
- Operating Regions: Oklahoma, Texas
- Investor Type: Accredited investors (SEC Rule 501(a))
- Minimum Investment: Typically $30,000+
- BBB Accredited

## Investment Structure

BassEXP offers several investment structures:

### Working Interest
Direct ownership stake in oil and gas wells. Investors share in production revenue proportional to their interest percentage while also participating in operating costs. Provides the highest return potential and full access to tax deductions including IDC, TDC, and depletion.

### Royalty Interest
Passive income from oil and gas production without exposure to operating costs. Royalty owners receive a percentage of gross production revenue, typically 12.5-25%. Lower risk than working interest but fewer tax benefits.

### Direct Participation Programs (DPP)
Tax-advantaged investment vehicles that allow investors to participate directly in oil and gas operations. DPPs pass through income, deductions, and credits directly to investors on Schedule K-1. Particularly attractive for high-income W-2 earners seeking to offset active income with oil and gas deductions.

## Tax Benefits for Oil & Gas Investors

Oil and gas investments offer some of the most favorable tax treatment in the U.S. tax code:

### Intangible Drilling Costs (IDC)
Approximately 65-80% of total well costs qualify as IDC, which can be deducted 100% in the year incurred. IDC includes labor, chemicals, drilling fluids, and other non-salvageable costs. For a $100,000 investment, an investor may deduct $65,000-$80,000 in Year 1.

### Tangible Drilling Costs (TDC)
Physical equipment costs (casing, tubing, wellhead) that are depreciated over 7 years under MACRS. Bonus depreciation may allow accelerated deductions.

### Depletion Allowance
15% of gross production revenue is tax-free through the percentage depletion allowance. This deduction can exceed the investor's original cost basis — a benefit unique to oil and gas among all asset classes.

### Active Income Treatment
Unlike most passive investments, oil and gas working interest income and losses are classified as active income under IRC Section 469. This means net losses can offset W-2 wages, salary, and other active income.

### Section 199A Qualified Business Income
Oil and gas income qualifies for the 20% pass-through deduction under Section 199A, further reducing the effective tax rate on production revenue.

## Current Projects

### East Renfrow
Active development project in Oklahoma's proven East Renfrow formation. Features developmental drilling in established production areas with lower geological risk.

### Existing Production
Revenue-generating wells currently in production, offering immediate cash flow from established reserves.

## Educational Content

BassEXP maintains a comprehensive library of educational resources:

- **How to Invest in Oil and Gas** — Complete 11-section guide covering investment types, tax benefits, risk management, accredited investor requirements, and due diligence checklists
- **Oil and Gas Royalties Guide** — Detailed explanation of royalty types (LRI, ORRI, NPRI), valuation methods, and income expectations
- **Oil Well Investment Insights** — How to evaluate well economics including cost breakdowns, decline curves, and expected returns
- **Tax Benefits Guide** — Comprehensive coverage of IDC, TDC, depletion, active income treatment, and year-end planning strategies
- **Oil & Gas Glossary** — 300+ terms defined with short definitions, extended explanations, practical examples, and investor significance
- **Tax Calculator** — Interactive tool for estimating IDC deductions, depletion allowance, and total tax savings
- **STEO Reports** — Monthly analysis of EIA Short-Term Energy Outlook data and market trends

## Frequently Asked Questions

**How do I start investing in oil and gas?**
Accredited investors can begin by contacting BassEXP for a comprehensive investor package. The team educates potential investors on available opportunities, expected returns, risk factors, and tax benefits before any commitment.

**What are the tax benefits of investing in oil and gas?**
Key benefits include: 65-80% Year 1 IDC deductions, 15% depletion allowance on gross revenue, active income treatment for W-2 offset, Section 199A pass-through deduction, and 7-year MACRS depreciation on tangible costs.

**Is oil and gas a good investment?**
Oil and gas direct participation offers potential for high returns (15-30%+ cash-on-cash), significant tax advantages, portfolio diversification uncorrelated to stock markets, and tangible asset ownership backed by physical reserves.

**What is an accredited investor?**
Under SEC Rule 501(a), accredited investors must have: annual income exceeding $200,000 ($300,000 jointly) for the past two years, or net worth exceeding $1 million excluding primary residence, or certain professional certifications (Series 7, 65, or 82).

**Where does BassEXP operate?**
Primarily in Oklahoma and Texas, focusing on proven formations with established production history to minimize geological risk while maximizing return potential.

## Contact Information

For investment inquiries:
- Phone: (405) 832-1777
- Email: info@bassexp.com
- Website: https://www.bassexp.com/contact-us
- Suitability Questionnaire: Available on the website for qualified investors