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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: Thean who wrote (4905)12/11/1997 11:38:00 PM
From: Lucretius  Read Replies (3) of 95453
 
Well, I go to play golf today, and look what you guys let happen! On a more serious note, Thean-No. See my post 4804. Chevron, I believe is concentrating more on deep water. I haven't seen any cut-backs there. TX has always been a little strange and has never been a real exploration player. Note they purchased Monterrey resources earlier this year (formerly of SFR) following this newly pronounced strategy. According to my people, they don't see rigs freeing up anytime soon and trying a different approach, hoping that they can grow through other methods (exploration has never been their strong point andn it is getting expensive.) Somebody else still has to drill in order to replace the industry-wide depleted reserves, for TX to buy ( for example SFR). They just don't want to take the risk. It's classic free-rider problem. If everyone took this approach and drilling stopped, prices would soar on existing proven reserves so that drilling would become dirt cheap on a comparison basis. TX is betting (probably right) that this will not occur. I think the budgeted output increase is more phenomenal than anything else. If they do not meet their objectives through aquisitions and exploitation, they will HAVE TO DRILL and DRILL FAST. Hang tough, don't let the Asian blues get ya down. Good Luck!

-Lucretius
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