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

To: Cogito Ergo Sum who wrote (4771)	11/9/2002 3:52:31 AM
From: energyplay	Read Replies (1) \| Respond to of 11633

Thanks, I had not seen that. Had read about the incredible production at Ladyfern - those wells produced like some of the deep water Gulf of Mexico - 30 - 60 MMCF per day. That and the lower storage are going to mean tight gas supplies this winter, and likely tighter supplies in 2003-2004. E&P companies are holding back drilling because of concern over the price of oil - since many gas wells make 5-25% of their return from oil / NGL / condensates, these wells won't get drilled. Prior to this, concern about the huge storage numbers we had over the summer detered drilling - a warm winter would have sent prices plunging. That danger is receding with cold weather and declining production, but the fear of cheap Iraqi oil is keeping the rig count down. So we may not have an economic response to increased gas prices, or that response will come late, and be in catch -up mode for a long time - maybe more than a year. Also, the inventory of new drill sites has been depleted in many areas - no investment in seismic, geologist shifted overseas again, etc. With the exception of Barnett shale in Texas (done by Mitchell MND now Devon DVN) and Nova Scotia there aren't new areas that can contribute. Mackenzie and Alaska gas will be next decade. Other big push has been coal bed methane, but now that Wyoming has enough water, that's slowed down. I can see an situation developing with high gas prices for 2-3 years. This is not yet reflected in the prices of the energy trusts. Lucky for us. Best Reagrds, energyplay