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

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To: Frank Pembleton who wrote (18769)	2/23/2003 9:20:52 AM
From: quehubo	Read Replies (1) of 206110

Frank - I dont suppose you recall the Lehman spending survey where they industry said they would be increasing spending in 2003 on the international side? Which I suspect is mostly long term oil projects. The survey was based on WTI is the mid 20's I believe and NG <$4. The key variable to watch is not activity levels in oil drilling, but activity levels in NA NG drilling. In three months US NG drilling will be 100+ RIGs higher and the service stocks will move accordingly IMO. Energy prices are only a leading indicator of future cash flows and spending by E&P's. How much the market wants to anticipate future spending is the unknown, but presently I do not see a disconnect between expected future activity and OSX prices. ME crude will start arriving, and just in time because March will continue with very high distillate demand I suspect. NG will be priced high enough to ensure that and the East Coast has very low NG stocks.

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