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

To: jim_p who wrote (69527)	7/12/2000 8:02:00 PM
From: Tomas	Read Replies (1) \| Respond to of 95453

Outlook for world energy demand, supply and investment William Ramsey, Deputy Executive Director of the International Energy Agency, comments on the outlook for global energy demand, supply and investments in the next two decades. (Source: Bloomberg Energy, July 11) Energy demand is expected to go up by 4.1% annually, fuels 3.9%, oil 3.6% and gas at 5.5%. Asian energy demand will triple during the period 1995-2020 and 90% of that growth will be fueled by fossil energy. 65% of increased oil demand will be for transportation as demand for transport services triple. Oil demand will increase 41.5 million barrels per day in the next 20 years to 111.5 million barrels in 2020. If you take just the Middle East OPEC countries expanding capacity from 21 million barrels per day to 46 million barrels a day by 2020, that's a capital requirement of $75 billion just for expanding that capacity. If you extend that to the world, we can estimate $280 billion to add the 41.5 million barrels to the existing capacity and probably a like amount to sustain the existing capacity. About 50 million barrels a day of oil would be coming from Persian Gulf in 2020. World thirst for oil is being challenged by growing interest in gas. The world is using 8 trillion cubic feet of gas a year now. We're going to need another 7 tcf by 2020 during which time Asian demand is going to be quadrupling. If you think security of supply is a problem with oil, I suspect the bigger surprise will be gas. Typically gas pipelines are more vulnerable than oil moving around in tanks. Fifty percent of world's gas reserves are in Russia and the Middle East. Cost of incremental capacity in power generation and transmission required around the world in the next 20 years (could be) between $1 trillion and $1.25 trillion between 1995 and 2020. Again China's is the largest growth market. You got a pretty tremendous capital requirement for next 20 years and I'd suspect the competition for that capital will be every bit as intense.

To: jim_p who wrote (69527)	7/13/2000 5:35:29 AM
From: Think4Yourself	Respond to of 95453

Thanks for the info on TRU. I went to the website to check out the breakout. You are right in that they do produce from the rapidly depleting (3yrs) Austin Chalk but it only appears to be about 3% of production. 82% of production has a reserve life index of over 9 years. Am I missing something? I got this information by combining information from the latest 10Q (snippet below) and their web site (also below). FROM 10Q Three Months Ended March 31, ----------------------------------------- 2000 1999 ------------------ -------------------- Bbls Mcf Bbls Mcf of Oil of Gas of Oil of Gas ------ --------- ------ -------- Chalkley Field 4,549 580,186 5,692 681,010 Robinson's Bend Field --- 629,060 --- 693,417 Cotton Valley Fields 991 296,194 1,150 325,842 Austin Chalk Fields 5,199 47,882 6,937 71,177 ----- --------- ------ --------- 10,739 1,553,322 13,779 1,771,446 ====== ========= ====== ========= FROM WEBSITE: torchroyalty.com Underlying Properties: 97% of reserves are natural gas 48% of production produced prior to 2003 qualifies for Section 29 tax credits 521 producing wells; 445 Torch operated Average net daily production - 28 MMcfe Average reserve life - 9 years Austin Chalk Fields 59% of reserves are natural gas 65% of gas produced prior to 2003 qualifies for Section 29 tight sands gas tax credits 79 producing wells Average net daily production - 2 MMcfe Reserve life index - 3 years Comprises 3% of total reserves Cotton Valley Fields 98% of reserves are natural gas 47% of gas produced prior to 2003 for Section 29 tight sands gas Section 29 coal seam gas tax credits tax credits 41 producing wells Average net daily production - 4 MMcfe Reserve life index - 20 years Comprises 31% of total reserves Chalkley Field 97% of reserves are natural gas 0 gas produced prior to 2003 qualifies for Section 29 tight sands gas tax credits 6 producing wells Average net daily production - 13 MMcfe Reserve life index - 6.3 years Comprises 31% of total reserves Robinson’s Bend Field 100% of reserves are natural gas 100% of gas produced prior to 2003 qualifies for Section 29 tight sands gas tax credits 395 producing wells Average net daily production - 9 MMcf Reserve life index - 11.5 years Comprises 35% of total reserves