---
title: Considering Natural Resource Private Equity? Keep This in Mind
description: "Usually, natural resource public equities trade at a premium to private investment, but today, the opposite is true. \nNot only are public equities relatively cheaper, but their well quality is often superior."
image: https://blog.gorozen.com/hubfs/Blog%20Images/Blog-146-LinkedIn.png
---

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## Considering Natural Resource Private Equity? Keep This in Mind

05/02/2019

[![Bakken](https://blog.gorozen.com/hs-fs/hubfs/Bakken.png?width=1230&name=Bakken.png)](http://bakken.com/news/id/258062/january-12-rig-count-and-oil-price-both-climb/)

## **Tempted to invest in natural resource private deals?**

 

The past 18 months has seen one of the more curious divergences we have ever seen: natural resource public equity has seen large liquidations while natural resource private equity have not.  While we don’t believe that there is anything fundamentally wrong with investing in natural resource assets via private investments, this divergence has led to a valuation has of **upwards of 35% compared with public valuations**, according to our models.

 

Normally, public assets trade at a premium, due to the discount for lack of marketability applied to private equity investments. Today, this is just the opposite. Moreover, our models show that on average, **public companies are drilling better wells than their private counterparts, by as much as 40% on average**. We think that public market investors are simply frustrated with owning energy and natural resource assets, which has led to widespread liquidation – and created unprecedented opportunity in the asset class today.

  

**We are releasing our in-depth Q1 commentary in the very near future. If you want to be on the list to be notified first when it's ready, please [sign up](https://info.gorozen.com/subscribe-to-our-blog) today!**

 

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Goehring & Rozencwajg Associates, LLC. The information provided on this website is intended to provide the investor with an introduction to Goehring & Rozencwajg Associates, LLC. Nothing on this website should be construed as a solicitation offer, or recommendation to buy or sell any security or as an offer to provide advisory services. Information on this website is intended only for United States citizens and residents. Nothing contained on this website constitutes investment, legal, tax, or other advice nor should be relied upon in making an investment or other decision. Investors should always obtain and read an up-to-date investment services description or prospectus before deciding whether to appoint an investment advisor or to invest in a fund.

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