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Gold/Mining/Energy : Big Dog's Boom Boom Room

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To: quehubo who wrote (17678)	2/1/2003 12:31:34 PM
From: russwinter	Read Replies (2) of 206099

<I would stay away from drillers with heavy floater ownership. RIG GSF DO . It's already in the price: selling at 117, 109, 92% of NAV respectively. I think deepwater makes a big comeback fairly soon, and the leverage is huge. I like 'em. DO especially also has great leverage to the GOM jack up market. Read over the Lehman report and they're just too far behind the curve on NG supply destruction. We had a 5% plus decline in 02: year over year in NG production INCLUDING a whopping 2% sequential 3Q-4Q, and they call for only a 1-3% decline in the US in 03, and 2-4% in Canada. At least they try and cover their butts by admitting their prior production projections were "too high". With the lackluster drilling activity to date, what's to stop a decline at least double the Lehman projections? Are there any truly substantial fields coming on line in the first half? We easily go below 700 (I'm thinkin' 625 with this cold Feb. now developing) on storage, and then watch a painfully slow build into the shoulder months. Summer cooling season should be interesting. Also we need to include the stunning Canadian drawdown in there for proper perspective on how bad (or good if you're a NG investor)this gets.

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