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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Thomas M. who wrote (16394)	3/24/1998 9:45:00 PM
From: 007	Read Replies (1) \| Respond to of 95453

I hope you didn't interpret my post as meaning that oil prices need to be rising for these stocks to be rising. For lasting appreciation of a driller, the outlook for crude oil prices needs to be such that it is likely that oil companies will continue in the long-term to demand that driller's services. The oil companies' decision comes down to the expected profitability on the probable reserves found from the drilling activity. This will always depend in part on the anticipated price of the commodity at the time it is expected to be available for sale. Anything that causes that anticipated price to be higher will increase demand for the driller and also have a bullish effect on the driller's stock. 007 PS Don't take my word for it, ask Mr. Market.

To: Thomas M. who wrote (16394)	3/24/1998 10:17:00 PM
From: Teddy	Read Replies (3) \| Respond to of 95453

NEWS from Offshore Data: ( Teddy's outlook for the oil industry has changed. He read MB. ) Jackup NOBLE JOHN SANDIFER is expected to complete a contract with Oryx Energy later this week. The rig will then go to Brazos Block 442 for about two weeks for equipment offloading and inspection prior to leaving for a two-year contract with PEMEX off Mexico starting in April. Mexico is cutting production, therefore they will stop exploration. AUSTRALIA: R&B Falcon jackup RON TAPPMEYER was awarded a one-year contract from Mobil starting in late August. The rig is currently working for Apache Corp. off Australia. Doesn't Mobil watch the news? Production cuts. You don't lease a rig when there are going to be production cuts. Makes ya wonder how that company got so big. UK: British Gas is studying development options for the Cook field in UK Block 21/20a. The field holds an estimated 30 million barrels of crude. The field likely will be developed with an FPSO that BG may lease or purchase. Field production could begin in late 1999 or 2000. What are these guys thinking? By 1999 OPEC will have opened the spickets again and oil will be $3. NEW YORK/RUSSIA: Russia's largest oil company, Yuksi, signed a strategic alliance agreement with Schlumberger. The accord will enable Yuksi to outsource an agreed level of oilfield services in its Russian oil fields over the next five years. Schlumberger will be Yuksi's sole provider of services on a number of selected fields under development by Yuksi. The alliance makes the latest oilfield expertise and technology available to Yuksi, and gives Schlumberger access to the Russian market. SLB was down today even though they announced this $2 Billion deal. That's because so many other projects are going to be canceled. Most of this was announced last week: Exxon, Global Marine ink new drillship deal Houston-based Global Marine received a letter of intent for a deepwater drilling contract from Exxon. Global Marine will build a second Glomar 456 Class dynamically-positioned drillship for the three-year contract. Revenues generated over the three-year term are expected to total $208 million. Exxon said that the rig will be used to drill deepwater acreage in the Gulf of Mexico and offshore West Africa. Global Marine has an option at Ireland's Harland & Wolff Shipyard to build the rig, which will cost about $330 million. The rig is slated for delivery in the first quarter of 2000 and initially will be outfitted to drill in 8,000 feet waters. These guys are crazy for paying so much for a rig that won't be ready until the year 2000. By then there will be hundreds of rigs looking for work. New acreage available offshore Nova Scotia. The Canada-Nova Scotia Offshore Petroleum Board is offering 11 parcels for exploration offshore Nova Scotia. Bids will be evaluated on total work expenditures proposed by oil and gas companies during the first five years of the nine-year leases. The parcels are divided into two groups. One group of blocks is located north of Latitude 46 degrees North; another is near Longitude 60 degrees West. Minimum bid is $1 million. Bids must be submitted by an April 30 deadline. The Call for Bids follows the recent request for bids on 13 tracts offshore Newfoundland. The Newfoundland bids must be submitted by Sept. 16 to the Canada-Newfoundland Offshore Petroleum Board. No one is going to bid on these tracts. E&Ps were crazy to spend $1.3 Billion at the GOM lease sale last week. No one is exploring for new oil any more, there will always be an over supply. Alaska: MMS to offer Beaufort Sea acreage in August. The Minerals Management Service plans to hold Beaufort Sea Sale 170 in August and issued a Proposed Notice of Sale. The proposal has been forwarded to Alaska's Gov. Tony Knowles for comments with a final decision on the sale due in July. We can't even use all the oil we a pumping from Alaska now, what makes them think anyone is going to look for more? Exploration planned off Belize. Dover Technology and a group of partners are expected to sign a new exploration agreement that covers Block 13 and the former Gladden Block offshore Belize. The agreement will be retroactive to Jan. 1, 1998. Dover's partners in the acreage include Belize Natural Resources, Magellan Petroleum Belize and Megallan Corp. Now that OPEC and friends are cutting production, this project will be canceled. Monument, BP to explore around Andrew, Cyrus fields. Monument Oil and British Petroleum signed an agreement for joint exploration around the Andrew and Cyrus fields. Both companies have identified a number of exploration prospects, including potential satellite developments that can be tied-back to BP's Andrew and Cyrus installations. The agreement calls for Monument to farm-in to Blocks 16/23, 16/28 and 22/3a by funding BP's share of up to four exploration wells. Monument will earn a 50 percent stake in each block. Drilling will begin later this year. Sure, they talk about drilling later this year, but once they hear about the production cuts, they'll change their minds. Norway may issue out-of-round licenses. The Norwegian government may invite oil and gas companies to bid on certain licenses in an out-of-round offering. The round may include blocks near several mature fields including Gullfaks, Oseberg and Statfjord. No one was bidding on the round licenses, so they figured if they changed the shape they might find a sucker. Elf prepares for Libyian drilling program. Elf Exploration expects to have a rig in place soon for its 18-month plus options drilling program offshore Libya. Drilling should begin in late August or early September. Bids for the program, which will be in water depths up to 1,150 feet, were due in January. Ya right. Libya is part of OPEC. There will be no drilling here. Exxon plans three wells off Angola. Exxon will drill three more wells in deepwater Block 15 offshore Angola this year following the operator's recently announced Kissanje discovery. Exxon will use the drillship PEREGRINE III and the semi OCEAN VALIANT. The operator believes Kissanje contains about 250 million barrels of oil. Why would they drill three more wells? They'll never be able to sell the oil. Nigerians award production-sharing contract. South Atlantic Petroleum reportedly was awarded rights to explore the deepwater Niger Delta OPL 246 offshore Nigeria. The company will bring in a partner to explore and develop the license. The concession is near Shell's N'Golo discovery on OPL 219 and Conoco's Ebitemi discovery on OPL 220. Are these guys stupid or what? Even if they do find oil.... well, you know: either they can't sell it because of the quota or the price will be too low. It's all over.