Doug / Oil & Gas Information
Let me first mention a wee bit of info. Here is a good location for keeping up to date on oil and gas.
Bookmark The Location
info.http://www.canoe.ca/MoneyOil/mw_oilnews.html#1
There are other current links to crude oil and natural gas subjects at this location also.
I know the guy that prepares the information. That's not an endorsement, he's an old geezer and thus, a veteran of sort.
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The trend in the oil and gas price is predictable - if OPEC lives up to their planned cutbacks ------ and I think they will. About three weeks ago, I guess estimated the price would approach $19.50 and then begin to back off and linger in the $16.50 to $18.00 range, before rising back to the $19.50 area by the end of the year. Just one person's opinion.
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In regards to size of producers to invest into - that's a mixed bag right now. I guess it depends on whether you're an investor or trader.
I classify a trader as one who is jumping in and out of stocks for quick profits or losses. An investor is one who is looking at a longer term return.
Personally, I am always looking at a 12 and 24 month window all the time and attempt to maintain that time frame as I move forward with an investment. I will maintain the holding, but will sell at the first sign of short-comings in the company.
If the share price gets far ahead of expectations, I usually sell a portion my holdings and take a little profit. Take the recent upturn as an example. I thought Crestar was a great investment around $12.00 and I personally had a 12 month price target of $18.00 fixed in my mind. It was my best value play. I had 1800 shares in my Level I portfolio, by far and away the largest weight holding. It took only 5 months to obtain that level, so I sold 1300 shares and took the profit. The remaining 500 shares will be in the portfolio for a long time forward. I like the company, but took a partial profit and will probably sit on the cash for a while - looking for another value play as the market zip-zags along.
Back to investing for the short term. Yes, junior oils are probably the best candidates (notice I didn't say "bets") for near term share price appreciation. But I must add, investing in these companies must be Selective. Search out those which should have minimum debt 12 months from now and have the acreage and reserves to explore and develop.
My favorites remain basically the same. I'll drop some names, but stress that one perform their own due diligence on the companies.
I like Purcell Energy a lot. It's a longer term investment situation. They are involved in probably the most exciting play in Canada with Chevron Canada and Berkley, amongst others. I anticipate their net asset value by year end will zoom and am looking for shares to do the same.
I like the situations with Genesis Exploration and Post Energy, in that sequence. Good management with good prospects. Among other small companies, I think the future is bright for companies like Compton Petroleum, Cypress Energy and I have two darkhorse candidates for success - Thunder Energy and Calahoo Petroleum.
There is another company I watch with keen interest and really have been impressed with their decision making over the past 12-18 months, and that's Startech Energy. They were among the first to react to the plunge in oil prices and laid it on the line with investors immediately. In addition, I think their program has been successful and the company should grow handsomely this year.
Larger operators I favor include Northrock Resources. They have inherited a good partner and resolved their debt situation. I like the momentum stocks, Rio Alto Exploration and now - Cabre Exploration.
Ulster Petroleums is improving on a year to year basis and see no reason why the trend should not continue. I guess I can't pass up mention of Talisman Energy, the viotale market performer. I like their international plays and if they have any luck with operations in turmoiled Sudan, (not with oil - that's there - it's just operating in a controlled environment) the company will leap forward with growth. I also believe they will be one of the principals after Regel Energy.
Last, if you like to invest into story stocks, keep track of the events as they unfurl in the Lost Hills Play in California. There are about 7-8 Canadian companies in the play and Berkley Petroleum has recently added to their stake there. There are a few little companies with all their marbles in the basket there. Westminster just sold most of their Canadian properties to jump into the fire (pun) there. These wells are deep, expensive and will take a lot of time drilling, thus one can expect dull periods in share movement. We are in one of those periods now, but do expect an update in a few weeks. This is a highly SPECULATIVE investments, but there is a little substance backing the situation. Most analysts in Canada are watching this situation.
Well, that's my two cents worth. If I spread it around enough, it may turn into a dime a few years down the road. Foremost, keep in mind, just one person's opinion, this time it was mine.
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