To: BILL L (4913 )
From: BILL L Saturday, May 30 1998 3:05AM ET
Reply # of 5044
TALLYMAN REPOST: Insightful vIews on ME from Tim. P (a non-SI ME DD member and lurker) in response to the dissenting view posted today. Thanx, Tim.
Bill,
Just returned to the office and saw the posts.
He's got a point that Independent Oilmen banning together to
revitalize "behind pipe" oil are a dime a dozen - but in case I think
these folks have the experience (per the PR) and are doing this at the
right time. True, the fundamentals really do remain to be seen
because this is a capital-intensive venture - I suspect their going to
need a significant amount of money to get going, I'm wondering if the
PR predicted for next week addresses that.
I don't know much about West Virginia. But just because major oil
companies have pulled out does not mean it won't be very profitable
for a smaller outfit like ME. My understanding is that major oil
companies like to get the biggest bang for their buck. No major
explorer is going sell his company on sending the troops into a small
to medium operation, at least not yet. Also remember, these guys are
not Shell, nor do they want to be, small to medium is fine because
it's the overhead and profit that count.
Nothing wrong with a "generic" release. I think the good detail lies
in the latest PR which details WHO THEY ARE. In fact, right now the
PRs should be generic because they want to catch the attention and
understanding of the layman for more funding.
I also think the independent evaluations are reliable.
In MHO, What these guys are doing is great, partly, their unitizing
stacks of available geological data to look again for suspected oil/NG
fields (during the late 70's to early 80's the major oil companies
were looking for fuel everywhere - they even were drilling in Upstate
N.Y. ! - they were hiring droves of kids with only B.S. degrees to
help, unfortunately, alot of them had to shift to the growing
environmental clean-up field when the big companies lost stateside
interest and did massive layoffs).
On their PR, I was encouraged by the statement that they are only
considering offshore sites in less than 50 feet of water - obviously
they are avoiding expensive operations.
Another great characteristic of them is that they are a energy company
and not just a oil company, big difference (my point, to use an
example, is that alot railroad companies went out of business years
ago because they saw themselves as railroad and not transportation
companies).
The clean burning fuel issue is critical. Power and energy is being
deregulated in California, that is, the consumer now or soon will have
a choice on who he buys it from. At the expense of utilities - this
new competitive structure will be successful because people like me
(100 other million Americans) will pay slightly more for clean power.
They appear to be right on top of this issue.
Another big-picture issue is what was stressed in the SA articles -
there is a finite amount of fossil fuel. The more that gets depleted
- the more valuable the remaining amounts becomes (Economics 101).
What I have not heard discussed much in relation to fuel consumption
are following: 1) Africa, South America, and China - they have yet to
be developed and will be very thirsty in the next 5-10 years; 2) the
Asian tigers will emerge from the doldrums with a huge appetite; 3)
IMHO, forget about the Russian reserves - more than likely they'll
find some way to screw up production or delivery to the world market;
and 4) the Middle East - Explosive. In fact those with an interest in
oil can thank Saddamm for torching 2 billion barrels during the Gulf
War. It's in North America's interest to avoid depending on this
region at all costs. The bottom line is that energy and especially
fossil fuel is going to become more valuable in the coming years -
therefore this will help small-medium operations in the U.S. such as
ME be successful.
IMHO, if these guys make the right moves, and the energy situation
unfolds like alot of analysts believe, it would not surprise me if a
large energy company buys out what is currently ME in 5 to 10 years
for over $ 30/share. In fact, just recently a Morgan Stanley Rep. was
just hawking to me how great the oil rig companies are going to be
(MDCO for one).
I'm far from being a true expert. But from what I know, I think these
guys could be winners because of timing. An old college professor of
mine worked in the oil industry for 14 or 15 years and his son now has
30+ years experience in this field, I'm going to seek their opinions
on this and report.
Good luck, Bill. Even if this stalls at .85 to 1.0, (don't think so),
I'm still very happy (not satisfied, mind you !) with my current
appreciation. Also, it great cooperating/sharing with like-minded
folks on your SI board.
Please post of any of this you want. I know I've rambled here with
most-likely alot grammer errors - so feel free to edit at will if your
going to post this.
Sincerely,
Tim HEADER: Insightful vews on ME from Tim. P (a non-SI ME DD member and lurker) in response to the dissenting view posted today. Thanx, Tim. |
