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.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (863)	11/22/2000 1:22:40 PM
From: Dave	Respond to of 74559

How would you "buy an oil field"? The most common way this year has been to try to buy a presidency run by people who run oil fields. But it seems that that strategy may fail. Dave

To: Tommaso who wrote (863)	11/22/2000 7:47:27 PM
From: Gofer	Read Replies (2) \| Respond to of 74559

How would you "buy an oil field"? Tommaso, you probably already know this, but for the benefit of others on this thread ... Amazingly, there are some equities that IMO are undervalued. Of course, in the current market situation, these stocks have been going down a bit, but I expect a rebound. They're Canadian Oil & Gas producers. Many of the smaller producers are selling at Price/Cash-Flow ratios of 2 or less and the larger producers at around 4. I've been buying the juniors with heavy natural gas weightings. If you're into royalty trusts have a look at Athabaska Oil Sands(AOS.UN) or Canadian Oil Sands(CO.UN) trusts which are both invested in the Syncrude Canada Oil Sands project. This is how you "buy an oil field". Links to most Canadian producers can be found on the Canadian Association of Petroleum Producers web-site: capp.ca Other than O&G stocks I'm on the side-lines watching the people still invested in tech stocks play football without their helmets. Cheers and happy thanksgiving to all Americans and give my regards to President-elect Al Bush. - Gofer

To: Tommaso who wrote (863)	11/22/2000 10:03:33 PM
From: TobagoJack	Respond to of 74559

Hello Tommaso, My experience with relatively illiquid investments at the mercy of human management has not been good when done for my own account. My style is also at odds with getting into situations where I can not exit with the press of a button. I get into positions slowly, but exit at speed, before trouble or at first sign of trouble, not generally in panic. However, when I do panic, I tend to panic first, with relish and glee. On oil, as my wife is gun-ho on buying the current market, I have pointed her towards PetroChina (HK.857) and Sinopec (HK.386). She was studying some thing far more toxic - Russian oils. China's economic cycle is turning up, deflation seems to be under control, and the oil field and processor stocks are cheap by world standard, certainly meant to succeed as China Mobile (CHL in US, HK.941 in HK, accumulated between July 97 to April 98) did. These companies are meant as a window to international capital for core industries and must do well. Exxon-Mobil and Royal Dutch Shell they are not.

To: Tommaso who wrote (863)	11/24/2000 4:31:51 AM
From: energyplay	Respond to of 74559

How do you buy an oil field (or part of one) By the way, about 5 million Americans have either royalty interests or working interests in oil and gas wells. Don't know what the numbers are for Canada. 3 ways - 1) Royalty trusts deplete, but this is pretty good. 2) Buy small, tightly run E&P companies, or large well run ones, like EOG, DVN, MND. (Disclosure - I own these) 3) Pipeleines & gathering systems for natural gas - some of their contracts read that they get x percent of the gas price. 4) Private placements in drilling for accredited investors. These are tricky, and since they have about a 50-70% success rate, you need to invest in 5-7 projects (preferably with at least 3 different companies) to have a reasonable probability of good return. There is a book by John Orban called "Money in the Ground" which cover this from a U.S. prespective (U.S. tax law and practices) You can get it from NARO, National Association of Royalty Owners (try www.naro-us.org) For a useful listing of companies offering private placements, go to www.oil-n-gas.com. It's a fee based site of accredited investors. 5) Get friends in the oil business to help you find & get in on deals. This works in Texas, OK, LA and a few other places. Somebody you know (fraternity brother, distant relative, friend of a friend may be in the oil business and may be able to get you into deals or may know some one who can. 6) Buy, inherit or marry into land which wells or potential for wells.