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Gold/Mining/Energy : Canadian Oil & Gas Companies

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To: mike smith who wrote (6735)	8/27/1999 1:24:00 AM
From: Richard Saunders	Read Replies (5) of 24921

mike/anyone - GAS to OIL Conversion. Beware of Fruit!!!! During the recent flurry of qtrly. releases I've noticed a few Canadian companies are using some apples instead of oranges when referring to barrel of oil equivalents BOEs. Calvalley's release today mentioned 6Mcf of natural gas the equivalent of a barrel of crude. I believe Chieftan also used the 6:1 conversion however much of their production originates south of 49. Traditionlly the conversion used is 10Mcf of gas is equivalent to 1 barrel of oil and most reserve estimates make such references. U.S. companies generally use the 6-to-1 conversion. Historically it would appear that Canadian gas prices have a "closer" economic equivalency using the 10-to-1 conversion however with Canadian gas pricing becoming closer aligned with u.s. pricing maybe more companies will want to polish the apple and use the 6-to-1 conversion? Just another thing to possibly be watching for when comparing companies?........... Comments anyone?

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