oil....Alberta oil sands

[selkirk]

one final point on oil and gas, do not believe oil will hit $100 however if it stays around $55 most of these oil/gas companies will produce great numbers.

also have recently heard a few "experts" in print and on TV comparing the oil gas run to the tech bubble of the late 90s.

there are a few small differences.

1. most of these companies are trading for 4-5 X cash flow per share.
most of the techs in the late 90s had little or no revenue.

2. trade 10-15X earnings, some less. most techs had no earnings.

3. these companies pay small divdends and will raise them.

4. have had a history ie. 10+ years of making investors money.

and they still are valued much lower than tech stocks today....other than these SMALL DIFFERENCES they are identical.

thansk
selkirk

 

[selkirk]

a few days ago Suncor produced its one billionth barrel of oil, from the oil sands.

they began producing 45,000 in 1967. in 2005 production averaged 171,000 barrels/day.

in 2006 SU hopes production to produce 260,000 barrels/day.

they hope to increase (expand ) 500,000 in 2010-2012.

SU trades in the US and Cdn. should make $2.08 in 2005 and $4.30 in 2006.

assuming a $50 cdn. oil
most brokerages rate the stock a hold. but it is a stock worth looking at for cdn. oil sands.

I have a holding in a drip/spp plan payed $42 in 1998-1999 avg. since then the stock has split 2-1 twice. do not plan on selling my position.

hoping for a pullback, but oil is still holding over $60. believe SU will be a good long term investment (it has been) however looking for a correction.

maybe if unsure buy a small part and then if it shows a profit add to the position....over time.

this like most cdn. oil sand stocks are very volatile despite doubling last year (like many of the others in this thread) April the stock corrected 10% and in the fall went down 23%+.

thanks
selkirk

 

[DOGS THAT BARK]

4-05----"of the ones listed above have positions in ECA, CNQ, TLM, and SU (DRIP/SPP).
also have covered calls against most of the positions at various prices."

Would say they are serving you well--3 of 4 within $1 of 52 week high at close friday.

Been waiting to get in but looks like I'll wait longer--some consolation -- PTR been rocking also . Saw where CNOOC (CEO) also within $1 of 52 week high after aquisition last week.

 

[selkirk]

DTB it has been a very good year in the cdn. market in general and especially oil/gas and metals.

of the four taking a wait and see on ECA still own some, but the last two quarter they hedge their prices. limiting gains. also cost have been increasing.
SU is an oil sands play, producer
CNQ is a good oil gas producer but they are developing cdn. oil sands. will not be done 2008.
ECA is a mainly a natural gas player, they have a cdn. oil sands project but it is just beginning...costs would be high.
TLM is a great oil gas player. have owned some since they left the Sudan (sometimes had a position before). US, Cdn., North Sea. along with plays in asia.

hoping for a sell off, would not take much of a drop in oil, natural gas has already fell of sharply, and shows how quick these commodities can fall, 12-8.70.

often the 1st quarter is the weakest for oil. however there is one factor that is impossible to predict politics. what happens in Iran, Nigeria.....who knows even the information is not often accurate.

for instance was it a strike or was it a rebel attack in Nigeria. if things quit down oil should go down at least a small amount. big if.


CIBC World Markets is one of the most bullish on the oil price. and believes oil can hit $70 barrel.

60% of the 3.6 million barrels/day in increase production will come from the cdn. oil sands.

new supply growth will grow from 1.5 million barrels/day on average in 2006 and also in 2007.

most of this growing production will be used up by growing economies.
it depends on how much surplus exist on (of coarse production) and economic growth.....ie: US goes into a recession then Asia slows downs...ect. and oil demand drops.

there are lower productions from the North Sea and Kuwait Burga.

other factors could produce production ie. Iran, Iraq, Russia. however in most cases there is not a strong demand to invest in these regions.

thanks
selkirk