In the fast-moving energy sector, service companies often face a common challenge: they complete work today, gear up crews, rent equipment, pay staff — but they don’t receive payment for 30, 60 or even 90 days. That lag in cash flow can hold back growth, delay new projects or even stall operations. That’s where oil & gas factoring comes in — a powerful financial solution also known as oilfield invoice factoring or oil and gas invoice financing. At First Capital, we specialize exclusively in this niche for service companies throughout the United States.
What is Oil & Gas Factoring?
Oil and gas factoring allows energy service firms to sell their unpaid invoices to a factoring company, thereby unlocking the value of those invoices immediately. Instead of waiting for your customer (often a major oil operator) to remit payment days or weeks later, you transfer the invoice to a factor. The factor advances most of the invoice value to you, then collects the payment from your customer and sends you the remainder (less a small factoring fee) once the customer pays.
Because you’re selling the invoice rather than borrowing money, you avoid debt and improve liquidity. This is especially critical in the oil & gas space where payment delays are common and working-capital demands are significant.
How Oilfield Invoice Factoring Works
Here’s a simplified step-by-step:
Your service company invoices your end-customer (an oil or gas operator) for work completed.
You submit that invoice to First Capital (along with any support documentation).
We verify the invoice and your customer’s creditworthiness (we specialize in oilfield/gasfield service customers).
We advance you a large percentage, often up to 90-95% of the invoice value, within 24-48 hours.
The factor collects payment from your customer when due.
Once payment is received, we remit to you the remaining balance, minus our fee.
You receive working capital quickly, avoid tying up resources in accounts receivable, and can focus on operations rather than collections.
Oil Factoring vs. Gas Factoring – Key Differences
While the core factoring process is the same, the differences often emerge in the nature of services, contract terms and customer base:
Oil factoring: More frequent in upstream oilfield service environments (drilling, completions, sand and water haulers, rig support). Payment cycles can be long; service costs high and cash-flow demands large.
Gas factoring: Often relates to natural-gas operators, pipeline, compressor and processing services, and companies working in gas-rich plays. Invoice structures may differ, but the same factoring mechanics apply.
Energy-sector factoring firms (like First Capital) must understand the unique contract terms, large invoice sizes, operator payment practices and the volatility of commodity pricing in both segments. By highlighting your ability to serve both oil and gas sub-verticals, you can attract a broader client base.
Why Service Companies in the Energy Sector Use Factoring
Accelerated cash flow: Instead of waiting weeks or months, you get cash in hand fast.
Avoid adding debt: Since you’re selling receivables, there is no loan or line of credit. This keeps your balance sheet cleaner and frees you to grow.
Bid bigger jobs: With working capital available, you can take on larger contracts, invest in equipment or crews, and not be constrained by cash-flow lag.
Industry-specific support: Many oil/gas factoring companies provide tailored service, A/R management and collections on your behalf—allowing you to focus on core operations.
Mitigate payment-cycle risk: In oil & gas your clients often pay slowly; factoring turns that into a manageable, reliable cash-flow process.
Top States for Oil & Gas Factoring
Because oil/gas service activity is concentrated in major production regions, factoring usage is higher in those states:
Texas – With major plays like the Permian Basin and Eagle Ford, oilfield service companies here are high users of invoice factoring.
North Dakota – The Bakken Formation has driven high oil-service activity and local factoring firms cater to that market.
New Mexico, Oklahoma, Colorado, Wyoming – Other states with active oil/gas service operations and factoring support.
In summary: Whether you operate in West Texas, the Rocky Mountain region, or other U.S. oil- and gas-service hubs, First Capital is positioned to fund you.
Why First Capital is the Nationwide Leader in Oil & Gas Factoring
At First Capital, we stand out in the energy-service factoring space for these reasons:
We specialize in oil & gas (not a generic factoring firm).
We serve clients nationwide, across all major states, not just regionally.
We offer high advance rates (up to 90-95%) and rapid funding, so you have fewer cash-flow bottlenecks.
Our team understands the specific needs of service providers: haulers, sand suppliers, rig vendors, pipeline services, contractors in upstream/midstream/downstream.
We offer flexible arrangements: recourse or non-recourse, spot factoring or ongoing contracts.
We allow you to expand, bid new projects, pay staff/suppliers on time—without the drag of waiting for payment.
Choose First Capital as your factoring partner and get the working capital you need for growth, reliability and operational peace of mind.
How to Get Started with First Capital’s Oil & Gas Factoring Program
Visit our “Oil & Gas Factoring” service page and fill out our quick application form (link internally).
Send us your most recent invoices (and your customer list) so we can assess creditworthiness.
Once approved, submit eligible invoices and receive funding quickly.
Apply the cash immediately to support payroll, equipment, suppliers or growth.
Focus on your business—let us handle collections and A/R management.
Get a free quote or speak with one of our oil & gas factoring specialists today.
Frequently Asked Questions
Q: Do I need perfect credit to qualify?
A: No. Qualification typically depends more on the creditworthiness of your customer (the operator paying you) rather than your own credit. Many oilfield service firms qualify even if they have limited credit history.
Q: Is this a loan?
A: No — you are selling invoices. The factoring arrangement is not adding debt to your balance sheet (though factoring fees apply).
Q: How fast can I get funding?
A: Many oil & gas factoring firms (including First Capital) can fund within 24-48 hours after submitting approved invoices.
Q: What if a customer doesn’t pay?
A: That depends on whether you selected a recourse or non-recourse factoring arrangement. With non-recourse, the factor assumes more of the risk; with recourse, you may retain more liability. Always review terms.
Conclusion
For oilfield service companies and gas-industry contractors, cash-flow delays are a serious obstacle to growth. With oil and gas factoring, you convert unpaid invoices into immediate liquidity, avoid adding debt, and keep operations moving. At First Capital, we specialize in this niche, serve companies across all major states and stand ready to be your trusted factoring partner. Don’t wait days or weeks for payment—get the working capital you need. Contact us today.