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Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Marc Fortier who wrote (2868)	3/15/2002 8:23:45 PM
From: Peter W. Panchyshyn	Respond to of 11633

I hope you're right Peter. A large part of PrimeWest production is hedged, as you know. Do you think that they're hedging future production at the current prices, or do they usually hedge later in the cycle? --------------- I touched on this in an earlier post regarding not a specific trust but all of the oil gas ones in general. You must remember that there is hedging going on on both the supply side and the demand side. My own thoughts is that the trusts may do it later on in the cycle. And may do so to varying extents. Based on their own circumstances and their own views of where they see prices for the commodities going forward. Though they are probably more concerned with hedges at the low end of the price cycle than at the high end. If their costs of production are say $6 a barrell hedging at $15 becomes much more important than if prices are at $30 a barrell. You must also remember that for them they may do so well in advance of any noticeable changes. And as such have to do a careful balancing act. Not to go too far or too little and then find out that they are wrong. Those trusts that have a large portion hedged will still benefit on any remaining portion. PWI's exact percentage hedged I don't know. Now as the price of the commodity drops you have the suppliers wanting to sign contracts to lock in a good current price thinking that prices are going to fall further. But on the demand side those that want the commodity may not be too overly concerned about signing contracts because they may feel the prices will also fall near to longer term. It is not until prices reverse direction and significantly that the roles maybe reversed. Those that demand the commodity may be more eagre to sign a contract going forward thinking that if they wait too long that prices are going to be much higher. Its all quite the balancing act. Sticking to the trusts with a longer term tract record of coming out ahead in this balancing act maybe one thing a new investor to these trusts may wish to keep an eye on. And all that info would be found in their past financial reports.

To: Marc Fortier who wrote (2868)	3/15/2002 11:13:40 PM
From: Cogito Ergo Sum	Read Replies (1) \| Respond to of 11633

Hi Marc, I sold my PWI back near the lows. Mainly for their lack of clarity and bad response with regard to their Enron exposure per their hedging. I recently re-bought Message 17197728. Because it is liquid, well hedged, and attractively priced at these levels. The stink of Enron appears behind them. Shame on me however for not checking their current hedging and assuming it had not changed in the last couple of months.http://www.primewestenergy.com/pdfs/q_reports/Q3%202001.pdf. They have (as usual) quite a web of hedging see page 2 of link. Unless we get another bubble I don't think their hedging is a negative. Anyway the details are all their to wade through, as always do your own DD, it's your nickle. As an aside in the totally unclear world of energy prices here is one take. eia.doe.gov regards Kastel a cute and cuddly Canadian disclosure: I also own a good whack of AVN.UN (A bit toppy here methinks) and a little COS.UN EDIT Congratulations DAK for buying that big whack of PWI at the lows. Let's hope those MNP lottery tickets pay off :o)