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: Robert T. Quasius who wrote (175)	4/25/1999 8:42:00 AM
From: Mark	Read Replies (1) of 318

I think most of the E&P companies have basically minimized drilling activities, not just the small or micro players suffering from the low prices. I'm not sure I know what you mean by "damaged". These companies continue to produce as usual, only now with much better cash flow and earnings. OK, so let me get this straight. You seem to be arguing that the down-turn has actually improved profitability for these companies ? :) Actually, I'm just teasing, and I do know what you mean. However I also think it's taking a very short term view. You must surely agree that the cut-backs in drilling must mean that many of these companies have damaged their future ability to produce (or at least to maintain their growth trends in the mid-term future). Or was there so much excess drilling activity over the last few years that even the worst placed company just has to uncork a few spare wells that they've stockpiled for a rainy day? :) I think what this basically reveals is that we are using two different ways to play this down-turn. i.e. Either treat it as a recovery play, and buy those stocks that folks have worried will fail, OR, use this as a value play to buy the better growth companies at discount prices. I think I'm with PG on this one! (I just wish I'd bought PTEN a few weeks ago, which seems to have afforded a great combination of both strategies). Mark

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