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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: energyplay who wrote (34550)	8/20/2004 12:59:24 AM
From: Taikun	Respond to of 206328

One a week would be nice. They're predicting a strong VLCC market until 2010. FRO closed at $39.77 today. The last 12 mos they have distributed $15.41 in dividends and spinoff SFL shares. biz.yahoo.com Reuters UPDATE - Tanker group Frontline sees strong market til 2010 Thursday August 19, 5:05 am ET By Ole Petter Skonnord (Adds detail, share price) OSLO, Aug 19 (Reuters) - World tanker markets may stay strong for the rest of the decade due to a phase-out of single hull vessels and rising demand, especially from India and China, Norwegian tanker group Frontline (Oslo:FRO.OL - News) said on Wednesday. ADVERTISEMENT The world's leading operator of very large crude carriers (VLCCs) also reported a bigger-than-expected rise in operating profit for the second quarter and unveiled a plan to spin off its dry bulk operations to boost value for shareholders. Operating profit for the group climbed to $184 million in April-June from $142 million a year earlier, beating an average forecast of $172 million in a Reuters survey of six analysts. "On a short-term basis it looks very good and in the long term it looks optimistic," Frontline Managing Director Oscar Spieler told an earnings presentation. "In China and India we see a great potential, and we are surprised that the U.S. (oil demand) is still rising," he said. Frontline shares gained 1.6 percent to 261 Norwegian crowns ($38.45) at 0839 GMT, outperforming 0.3 percent rise in the Oslo benchmark index (Oslo:^OSEBX - News). Frontline, listed in Oslo and in New York, is benefiting from firm tanker rates that have been boosted by strong global demand for oil and for crude transports to and from the Gulf. "Frontline expects to report strong earnings for the rest of the year," the Bermuda-registered company said in a statement. "The strength in the short-term market combined with the increasingly tight supply/demand balance until phase-out of single hull tonnage in 2010 may create a very positive market situation for tankers for the next 5-7 years," it said. New international rules are forcing a shift to double-hulled vessels, which are less prone to catastrophic spills like that of the single-hulled Prestige, which broke up and sank off Spain in 2002 carrying 77,000 tonnes of fuel oil. DRY BULK SPIN-OFF Turnover for the group, which is majority owner of U.S.-listed tanker leasing group Ship Finance (NYSE:SFL - News), rose to $357 million from $330 million. Frontline, controlled by Norwegian shipping tycoon John Fredriksen, said the dry bulk market had shown substantial strength during the past year, driven by strong demand, particularly for iron ore and coal. "In view of Frontline's strategy to be a pure tanker company, the board feels that the dry bulk assets will give a higher value to shareholders if developed in a stand alone company," Frontline said. "The board has therefore taken a decision in principle to seek to establish a new dry bulk company, which is likely to be spun off to existing holders of Frontline shares," it said. Frontline formed Ship Finance last year as part of a plan to sell ships to the unit and lease them back, aiming to free up cash and increase its dividend. On Thursday, Frontline said it would distribute a further 10 percent of Ship Finance's shares to its shareholders, cutting its holdings to 63 percent from 73. In an apparent change in strategy, Frontline said it was considering fixing parts of its fleet in longer-term contracts. "The current long-term rate on the tanker market is today significantly higher than Frontline's cash break even rates," Frontline said. Its break even rate after its spin-off of Ship Finance is at about $27,000 for its VLCCs. "A fixture of part of the fleet will thereby reduce the financial risk and secure return to shareholders," it said.

To: energyplay who wrote (34550)	8/20/2004 6:52:48 PM
From: Taikun	Respond to of 206328

EP, I don't know if you got into PWT.TO. I now think it could go to the $74 target I mentioned earlier. Institutions will love this. PWT.TO has already received an early favourable indication from the tax authorities on income trust conversion. They said they would do this before putting the idea to vote. Cheers, T Penn West management recommends conversion into income trust 8/20/04 †† †† CALGARY, Aug 20, 2004 (The Canadian Press via COMTEX) -- Management at Penn West Petroleum Ltd. recommended late Friday that the energy producer be converted to an income trust, which would be the largest conventional oil-and-gas producer of its kind. Speaking at Penn West's annual meeting, the company's management told shareholders that conversion will occur providing the company gets a favourable tax ruling from the federal tax agency. Penn West's future has been up in the air since March when the company announced it would undertake a formal review of strategic alternatives. Those included maintaining the status quo, converting into an income trust, or the sale or merger of the company. According to its latest financial report, Penn West's second-quarter profit fell to $65.5 million from $192.5 million a year ago despite record production. It cited the impact of a strengthening Canadian dollar as one of the causes. Average daily production during the quarter was a record 109,280 barrels of oil equivalent, up six per cent. On the Toronto stock market, Penn West shares (TSX:PWT) closed at $65.42, down 88 cent on Friday. The online source for news sports entertainment finance and business news in Canada Copyright (C) 2004 The Canadian Press (CP), All rights reserved