Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: seadust who wrote (61826)	3/8/2000 5:44:00 PM
From: ItsAllCyclical	Read Replies (1) \| Respond to of 95453

MLRC reports year end reserves biz.yahoo.com Nothing like buying a company for 1/2 their reserve value and that's based up 2.10 gas with a company that sells 90% gas/10% oil. Reserves valued around 72 mil, present market value of MLRC around 36 mil. Thank you again Slider. This was a steal. I may buy more tomorrow, but I'm not going to chase it and I already have a good sized core position. If I can get it at 4 1/2 or less I'll double my stake. Sold my remaining RRC today when I bought MLRC. Don't want too many small caps in my portfolio in case of a sector wide pullback. BTW, I didn't even mention their production increases recently and those to come...

To: seadust who wrote (61826)	3/8/2000 9:49:00 PM
From: jim_p	Read Replies (1) \| Respond to of 95453

Seadust, There have been a lot of studies done about the value of purchasing mature oil basins that have produced large quantities of oil or gas. The Permian basin contains very long life properties, and is also one of the largest producing basins in the United States. The theory is basically that if you buy large mature fields, improved technology over time will prove the purchase price to be very low in hind sight. As technology improves, the percentage of reserves that are recoverable increases. The 2.2 billion BOE of reserves that are being purchased, are based upon todays known technology. That number may increase over time as technology improves. One of the streets concerns is the relative high cost to operate the properties. The purchase price of $3.6 Billion works out to be $4.24 per BOE of proved reserves in the ground. At $20.00 oil, even with high operating costs and without giving any credit for improved technology, I feel it is a very good purchase. I also believe that over time, it will prove out to be an even better purchase. People were shocked when Shell Oil purchased the Belridge Fields in California back in the 70's, but it turned out to be a home run for Shell Oil. There was a good seminar put on by Randall & Dewey, Inc on this topic about a year or so ago. If I had $3.6 Billion, I think it is a safe place to invest it. Jim