Receivable Financing Helps Oil and Gas Industry Players With the Working Capital and Growth Financing They Need — Now
The U.S. oil and gas services industry is experiencing an explosion in growth, as the country moves toward reduced dependence on foreign energy sources. As the technology of locating and extracting both oil and gas energy sources expands at an exponential pace, the demand for domestic energy continues to increase along with receivable financing.
“The scale of this unfolding oil and gas revolution in the United States” is surprising in its rapidity, according to Daniel Yergin, vice chairman of global information company IHS and head of the firm’s Cambridge Energy Research Associates unit (which he founded). Yergin is a long-time, recognized expert on the energy industry.
“The fact [that] our oil production is up 40% since 2008, and the economic impact it has had on jobs, manufacturing and competitiveness. I think that’s a theme that’s going to run through [the discussion],” Yergin said in an interview in March with CNBC in connection with an annual energy conference the firm has been sponsoring for many years.
Hydraulic fracturing, or “fracking,” has helped lead to this revolution in gas and oil production. The U.S. Energy Information Administration (EIA) has projected that there are 2,200 trillion cubic feet of gas resources in the U.S., enough for 100 years. In drilling for that gas, the industry uncovered a trove of natural gas liquids.
Furthermore, the International Energy Agency has projected that the U.S. could potentially leap-frog Saudi Arabia and Russia to become the world’s biggest oil producer by 2020.
The Implications for You
What does all this explosive growth mean for you? As a supplier of equipment and services to this rapidly expanding industry, you need to be able to deliver to your customers on time. And to do that, you need the financing to help you meet your working capital needs, as well as to invest in the ongoing growth of your business to meet the ever-growing demand.
But it’s difficult to meet these financial requirements when your customers do not pay down their account receivables in a timely manner. Very often, that payment timeframe stretches to 45 or 60 days, or even beyond – and your needed cash flow does not materialize fast enough.
Accounts Receivable Financing and Factoring Receivables Solves the Problem
The solution to meeting your short-term financing needs is to fund your operating and growth requirements through accounts receivable financing – where your accounts receivable are purchased by a factoring company at a discount, and you receive immediate cash.
At Paragon Financial, we have been a leading provider of receivables factoring to the oil and gas industry for nearly two decades. We help you customize a receivables financing program designed especially for your company’s requirements.
As part of this process, we provide you with immediate cash – up to 90% of your invoice amount. This working capital financing will help you meet payroll, pay suppliers, and fill the large order that might get away if you could not obtain needed parts and components in a timely manner. You don’t have to wait 45-60 days or more to get the cash you need now.
Furthermore, flexibility is a hallmark of our service at Paragon. We enable you to use receivable financing only when and if it is favorable to you. You choose the accounts you wish to use for your financing needs.
So whether your company is new to the oil and gas industry, or whether you have been in the business for decades; whether you have a major expansion opportunity and need extended funding; or even whether your company has had past credit problems and it has been difficult to locate a funding source – you can count on Paragon Financial to help you grow and prosper in today’s expanding oil and gas market.