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Gold/Mining/Energy : Canadian Oil & Gas Companies

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To: Richard Saunders who wrote (9390)	12/19/2002 9:52:36 AM
From: Richard Saunders	Read Replies (4) of 24935

Heinz 57 or "Follow the money" - a longer post and some silliness with numbers...... Recently there have been a few interesting news releases regarding the oilpatch. Yesterday PD Precision Drilling guided down indicating that their Contract Drilling Group was seeing less business than anticipated. Actual words were, "lower than anticipated drilling activity levels" Here's the link: newswire.ca Release also mentioned that the future seemed to indicate that a "strong Canadian market expected in the first quarter of 2003". Earlier in the week MAV Maverick Tube Corporation guided expectations lower for the 4th Quarter and included was a mention regarding the Canadian oilpatch -- "While Canadian drilling activity has seen recent improvement, it is still below our previous expectations."...... Release is at: makeashorterlink.com Even Schlumberger -- SLB listed on the NYSE -- recently alluded to reduced expectations in the North American oilfield services box. Link is at makeashorterlink.com Hmmmmmm. Slower activity. That isn't really anything that's not already known however if oilfield services activity is only now starting to start up the engines then where have the o&g producers cashflows ended up? To Dec.13 4Q average for the oil benchmark WTI spot was US$/Bbl $27.74 In 3Q the avg. price was $28.30 Convert that all out to Canadian loonies and there does appear to be decent cashflow potential. Gas pricing is even more pronounced. The AECO-C spot benchmark price to Dec. 13 for Q4 was C$/MCF of $5.50 That is compared to the Q3 average price of just over C$3.20 Point trying to be made is that based on commodity prices seen to date there is some decent cash flows happening in the oilpatch. IF spending as represented by some of the recent drillers' guidance hasn't been all that robust then the dollars should be going somewhere. Maybe into company coffers? We'll know for certain next spring when annual reports start to appear. That's part of the picture. The number silliness stuff........... Recently there have been quite a few news releases indicating the flow through season (maybe the flow through trough?) is in full swing. Investment bankers are doing their jobs and appearing to be raising quite a few dollars for just about any company that has oil or gas in their name. Flow through financings will need to be spent and the drillers will be near the front of the line to start picking up paycheques. One situation noted -- BN Brooklyn -- went to the trough twice this month. A $3mil. placement closed early in the month and just recently another $5.4mil. bought deal was announced. Obviously some of the above is already recognized if one looks at where the overall oil and gas producer indices have moved from and to. How much more of the tide remains to still rise? I don't know however there would appear to be quite a bit of potential for some decent capex spending plans in the days ahead based on current commodity pricings and the ongoing financings. A silly exercise just completed was to go back over the past couple of months and list out who has received financing. My list isn't by any means complete however it did touch on 57 situations. Pass the HEINZ 57....... All numbers are gross dollar amounts and haven't had the 8% or 10% that the brokerages often peel off for investment fees. Also, some of the situations listed and dollar amounts shown may not be totally accurate -- in some instances I pulled the indicated dollar amount and the actual placements haven't yet closed. On the other side of that caveat there is also potential for placements to be increased. Example would be CPG.a Crescent Point which originally was going to raise $8.5MM but upped it to $10.03MM. News release yesterday for CAG CanScot also indicated a little increase. Appearance is that there is indeed an appetite for financing product. At the bottom of the pile listed is little BEA Bearcat Exploration which picked up $150,000 Compare that to EEE Canadian 88's bought deal that closed Oct.22 for $52.8 million. 57 situations totaled $344,722,000 in financings. - Top 8 sized financings totaled $177.83 million. - Next 10 financings totaled $77.214 million. - Next group of 29 ($1.0MM to $5.00MM) accounted for $74.88MM - Last group (under $1 million) of 10 tallied $4.798 million. Here's the detailed list and possibly there are some symbols included that may be worth watching. Ranked in decreasing size of financings....... EEE Cdn.88 $52.8MM bought deal KWE Key West $30.0MM PGX Progress $25.0 MM closed Oct.01 GAU Gauntlet $20.0MM CMT Compton $17.5MM CLT Celtic $12.0MM included recent re-org. SNG Cdn. Superior $10.5MM CPG.a Crescent Point $10.03MM NVG Navigo $9.0MM upped from $8.0MM BN Brooklyn $8.4MM includes two slurps from the popsicle TRI Triquest $8.0MM bought deal KEC Kick Energy $8.0MM SPR Southpoint $7.8MM includes re-org and some debentures PEL Purcell $7.0MM TEW Tarten Energy $6.5MM RSA Rosetta $6.35MM KER Ketch $6.0MM bought deal BVX Bow Valley $5.16MM VEL Virtus $5.004MM OLT Oiltec $4.557MM up from $4.03MM RSX RSX Energy $4.533MM LXX Lexxor $4.5MM VCA Viracocha Energy $4.5MM bought deal OLY Olympia $4.2MM DXI Devlan $4.0MM bought deal GNL Great Northern $4.00MM IEY Impact $4.00MM bought deal ETE E3 Energy $3.75MM was Mill City and re-org'd. GNY Gentry $3.05MM TOT Toro $2.5MM MIG Millagro $2.5MM TEI Tango Energy $2.5MM ANG AltaCanada $2.11MM KTO K2 Energy $2.1MM KVL Cavell $2.06MM bought deal DEP Deep Resources $2.0MM includes re-org RRL Resolution $1.98MM TIV Tiverton $1.975MM closed Oct.10 - 15 WRL Winstar $1.768MM CAG CanScot $1.663MM FLO Flowing Energy $1.505MM RVL Raven $1.5MM DZR.a Diaz $1.5MM VPC Valkyries Petroleum $1.45MM spending in Texas CLL Connacher $1.40MM RTE Result Energy $1.16MM SER Semper Energy $1.12MM TRQ Terraquest $1.0MM SHR Shaker $918K includes debenture CDH Corridor $810K CHY Cheyenne Energy $720K ZCO Zapata $500K SHY Sharon Energy $500K NEL Nevarro Energy $450K SAW Sawtooth $250K CHO Chirripo Resources $250K PCR Pacific Amber $250K BEA Bearcat Exploration $150K Happy hunting. One thing FOR ABSOLUTE CERTAIN.......Not all situations will do as well as others.

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