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Gold/Mining/Energy : Sodra Petroleum
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To: Oily1 who wrote (126)10/15/2000 11:04:35 AM
From: Greywolf   of 133
 
NORTH FALKLAND BASIN: KEEP YOUR COOL IN THE FACE OF THE
LATEST OIL CRISIS

A few interesting words from my friend Juanita

By J. Brock (FINN)

Thursday’s sharp rise in oil prices has triggered nervous feelings amongst many
investors in hydrocarbons stocks. News broadcasts are touting the highest prices
since the Gulf War for Light Sweet Crude at more than £35.00 a barrel (during the
Gulf War it peaked at $41.00) and Brent Crude at just under $35.00. Indications are
that the prices could even go higher as the crisis in the Mid-East escalates.

The good news for investors in the North Falkland Basin is that the reserves are
there, the source rock is there regardless of the problems that have led to the sharp
rise in oil prices. Reverse the scenario and it is true that is that the reserves and the
source rock are there regardless of any future drastic drop in oil prices.

Like it or not, hydrocarbons are odd bedfellows with politics and this latest crisis
has been fuelled (pardon the pun) by the fear of the unknown as far as the
Mid-East is concerned. Will the events of the past few weeks in Israel spread to
neighbouring countries in the region? Will the flow of hydrocarbons stop as a result
of terrorism? There has been panic buying of crude oil because of these unknown
factors and this has pushed up the price of crude dramatically.

A good spin off in all of this panic is that the volatility in the Mid-East makes it
more attractive to invest in areas where the situation is not so critical. At the
moment, this indicates those Desire Petroleum stocks very interesting, indeed. But
don’t sell them off thinking that you will make a quick profit. They are down
compared to the high prices realised when people thought there would be a quick
discovery of millions of barrels of oil in the North Falkland Basin. The best advice is
to hang on to those stocks. They will create more interest once exploratory drilling
begins again in the area and when investors can see a positive result after all of
these years of waiting. Good times will come.

Investors should be aware that there are still splinter groups in the UK and in
Europe who intend to keep the pressure on as far as the price at the pump goes.
The rise in the price per barrel will ensure that these kinds of group movements will
be a possibility. But no matter what, the panic buying and the rising or falling prices
will not affect the quality of the source rock and the reserves in the North Falkland
Basin. Your investments are sound.

Hang in there.
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