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Strategies & Market Trends : Natural Resource Stocks
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To: isopatch who wrote (43288)8/24/2006 2:27:22 PM
From: JimisJim  Read Replies (1) of 108702
 
Am looking at nibbling on LNG for LT play... near its 52-week low right now, and long term (4 years, more?) remain bullish on LNG being a necessary way to try to bridge gap between nat gas demand in US and dwindling reserves in No. America.

Also continue to rotate out of land and shallow water drillers (NBR, GW) in favor of deepwater drillers (RIG, GSF, maybe DO, NE, or ATW for smaller play)... RIG and GSF have been beaten down pretty good lately and their prices are "coming to papa."

My reason for the rotation to deepwater is that there are already signs of a slowdown in shallow water and by next year, there will be so many new land rigs, the dayrates may collapse -- seem soft right now just anticipating next year. Also World Oil article (hard copy, April 2006 issue) had lots of shiny graphs showing the amount of money that is going toward capital investment in land/shallow water rigs vs. deepwater through 2010 and deepwater is where the heavy action is going to be, if the authors are correct.

Jim
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