PermianChain Technologies, a blockchain solutions provider, is introducing the Permian Token (XPR), a crypto asset-class that will underpin holding rights to the value of potential but undeveloped oil and gas reserves.
XPR is expected to eliminate the layers of bureaucracy and dramatically reduce broker and administrative fees. It will also make it simpler to pinpoint and alleviate delays, will improve investment efficiency and open the sector to a swathe of potential new investors.
Trading oil and gas is currently complex, slow and fundamentally inefficient, a statement said, adding that agreements are cumbersome and difficult to transfer without adding costs and there are so many different steps involved in the process of getting oil and gas from upstream through mid-stream to downstream, that the knock-on effect of delays at any point can be significant and costly.
The levels of complexity and inefficiency mean that many potential investors are reluctant to involve themselves in the market, reducing the sector’s potential liquidity and value.
The Permian Token’s system of smart contracts is intended to replace these complex agreements using the PermianChain; a blockchain network which is currently being developed by Canada-based PermianChain Technologies.
XPR is expected to reduce investors’ liquidity issues by creating a tradable crypto-asset on a permissioned-access trust-protocol. The smart contracts will also remove a large proportion of the administrative and brokerage burden from oil and gas suppliers, which could turn marginal fields into profitable ones.
There are already approximately 250 million barrels of potential oil and gas reserves planned to be listed on the PermianChain network, and the company has formed partnerships with a string of organisations including the Gulf Energy Corporation, Battiest Energy and Kaspian Innovations.
“Many private oil and gas opportunities are structured with an upfront fee due to their exclusivity and inaccessibility,” said Mohamed El-Masri, co-founder of PermianChain Technologies.
“Advisors and brokers take a proportion of the profit simply for placing investors’ money in the deal, which means charging higher investment costs to cover administrative and brokerage tasks, rather than helping the project itself.
“It also means that the offering company’s incentive is often to fill the deal quickly to protect their balance sheets in the short-term. There are currently over 1.6 trillion barrels of potential oil reserves globally. The Permian Token helps public organizations and private sector oil companies use them more efficiently,” he added.
More than 30,000,000 XPR tokens have been pre-booked so far. The founding partners are currently preparing the launch of the first round of its private placement, offering accredited investors and professional clients the opportunity to support the PermianChain project and secure their rights for XPR tokens. The firm is working closely with King & Spalding, a global legal specialist, to have XPR issued as a regulated crypto-asset.
Permian Token (XPR) is a crypto-asset that underpins holding rights to the value of potential oil and gas reserves that have not yet been produced. XPR enables the underlying value of oil and gas reserves to be digitally transferred.
As the only reserve digital currency for oil and gas contracts, we expect XPR will become a critical instrument for preservation of wealth and an ever-expanding range of commercial and consumer activities using blockchain technology.XPR uses the letter ‘X’ as a standard ISO 4217 code for non-country currencies and the letters ‘PR’ which stand for Potential Reserves, hence the Permian Token (XPR). – TradeArabia News Service
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