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Pastimes : Crazy Fools LightHouse -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (1266)	7/20/2006 4:50:32 PM
From: ms.smartest.person	Read Replies (1) \| Respond to of 3198

&#8362 David Pescod's Late Edition July 19, 2006 ULTRA PETROLEUM (AMEX:UPL) $53.84 +2.24 FALCON OIL AND GAS (V-FO) $ 3.70 +0.04 You’ve probably noticed us becoming quite the “worrywarts” over the last while regarding natural gas and maybe we have finally found the perfect antidote in Allan Laird, the Calgary based oil & gas man who has been involved in probably two of the most intriguing gas plays speculators have ever come across. He was involved with Ultra Petroleum back in its starting days for many years, but something happened there and well….suddenly he wasn’t with Ultra anymore! There are obviously not too many hard feelings on Allan’s part though, because he mentions today that two of his biggest holdings are still Ultra Petroleum and Falcon Oil & Gas. He points to Ultra and says, “they have just been approved for 2,500 drilling locations – that means with the downsize to 10 acre spacings, they are going to have proven drilling locations for the next quarter of a century.” (They are drilling 100 locations a year) But, why doesn’t he worry about gas prices? Heck, the chart shows you that even Ultra has been stumbling a bit because of those weaker prices. “Well, first of all”, he says, “I was in Hungary last year, when this little problem between Russia and the east European countries erupted and they turned off the gas in Hungary – that leaves an impression.” He also suggests that the decline rate these days is between 20% and 30% in gas production – probably closer to the higher number. We are going to need all the gas we can get... He also points out that he is a big fan of the oil sands projects and he points out that they are a huge user of natural gas and that he figures they can only grow, possibly significantly. In the short term, though, he says you could worry in that there is always the concern on what the weather is going to be next winter. That really could be something to worry about, we note, because of the current large inventory. Until recently Laird was associated with Falcon Oil and Gas (FO), like Ultra, a project spearheaded by Marc Bruner working on the Mako Trough Deep Gas Basin in Hungary. It’s a massive land holding into which Falcon has put a handful of holes, but so far has seen no testing, no reserves, no production. Falcon daily does huge volume and has enjoyed the market capitalization of over a billion dollars, despite no cash flow and one intriguing development the other day was showing the insider trading showing some insiders cashing in big-time and a whole lot of shares suddenly tradable. Laird still in touch with his cohorts at Falcon suggest that “there is lots of equipment they need for the testing that has to be imported into eastern Europe” and thinks much of the testing should be done in August with results near the end of August in what will be some much awaited results as this story has some big believers…and some big skeptics. Meanwhile, Laird, unemployed, enjoys the good life—waterskiing with a brand new motorcycle to tool around on...and we wonder what company he might next be involved with. We suspect, given his track record, it will be interesting! <b?WATCH RESOURCES (V-WR) $0.32 +0.02 Randy Buchanan is part of the team that runs Energy 51 and Watch Resources. Energy 51 got its name because many of the executives at that company were all born in the year of 1951, which tells you that they’ve got more than a little experience in the oil and gas business. The suggestion might also be made that they’ve got more than a few grey hair. We are interviewing Randy because after the recent land sales have been completed, Energy 51 and the public company Watch Resources, now have a fairly interesting program ahead of them. While there are a fair chunk of shares outstanding and not all that much land, what they do have might come up with something significant. Drilling to date suggests their heavy oil play is onto something and it is in a hot area of the Province, surrounded by company biggies like CNQ, Hunt and the like. Their 21-well program to start shortly will prove that they are onto something big that could generate a further 460 well program. Once again, prove or disprove. We think it’s a pretty interesting interview and we will be making it available early next week. Yes, we own a few.