Strictly: Oil and Gas Exploration Companies Message Board

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Gold/Mining/Energy : Strictly: Oil and Gas Exploration Companies

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To: William JH who wrote (154)	4/3/1999 2:13:00 PM
From: PuddleGlum	Read Replies (2) of 318

William- The independent E & P business model does not seem to work for investors, only corporate insiders and stock exchange insiders. Borrow against reserves for exploration, keep borrowing until the price of O & G crashes, then take impairments and writedowns, and on and on. I agree with your assessment that the independent e&p business model doesn't work some of the time, which is why I tend to avoid the real small e&p companies, but I believe that some companies can and do make it work. I have a small position in APA, a larger one in APC, and still larger in SFY. SFY has maintained profitability (not just positive cash flow), while APA and APC are very sound companies with a good outlook for the future. I noted your post on Strictly Drilling about natural gas deliverability over the near to medium term. SFY produces 75% ng, while APC has around 47% gas in its proved reserves, and APA has a bundle of gas stashed away. pg

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