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Gold/Mining/Energy : Canadian Oil & Gas Companies

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To: Goldberry who wrote (7013)	12/14/1999 3:29:00 AM
From: Richard Saunders	Read Replies (2) of 24920

Graham - Ulster ULP. Make sure you verify anything. Here's the 3Q link at the co. website: ulsterp.com A quick glance would indicate that for the 9month period Ulster averaged 23,470 barrels of equivalent a day and did about 75% of it in gas. Two, actually 3 things, seem to stick out. One thing is actually related to another -- hedging of production. In the link above mention is made that "marketing initiatives" reduced cashflow by $10.3mil for the nine month period. (Total 9month CF of $62.4mil. reported). Also related to that is the price rec'd for gas.......... $2.15/mcf. You need to check to see how much of ULP's production is sour as that may have also been a bit of a knock on gas prices rec'd. Sour costs more to process. The $2.15/mcf price is relatively "low" when compared to year-to-date averages for something like the AECO-C benchmark price. I don't have averages close at hand and haven't tried to figure the 9month avg. AECO benchmark price but it's probably north of $2.75/mcf cdn. Here's a link to pricing references if you want to verify detail.... ngx.com The other thing that Ulster indicates in the Sept. 30 financial is Long Term Debt -- just under $257mil. Possibly that's being viewed as a bit of a drag? Ulster did do a bought financing that closed Sept. 29 so make sure you verify spew above, possibly the 3Q debt number mentioned above has been softened a bit, I haven't checked. 3Q Cashflow reported was just over $22mil........... As Craig also mentioned, some drilling is active and successes with the drill bit (Leland area in particular) will likley help the situation. Possible peer company for comparison would appear to be Northrock NRK-tse. Both have over 40mil shares o/s, are within $20mil of each other in LT Debt based on 3Q reports, and appear to have approximately similar production profiles. You asked for tho'ts. - possibly the debt, overall current mkt. sentiment re: gas/weather and some of the reduced upside due to earlier lock-in of gas revenue via hedging may be some of the reasons for price erosion? Hope it helps........

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