Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: TulipMania who wrote (26219)	7/22/1998 2:10:00 PM
From: Redman	Read Replies (1) \| Respond to of 95453

Gulf Island (gifi) beat estimates of $.39 by $.05, coming in at $.44 per share. That with little change in their backlog. For this excellent report, with no down revisions in the past either, it is down 1/2. Makes perfect sense doesn't it. green

To: TulipMania who wrote (26219)	7/23/1998 3:12:00 AM
From: pt	Read Replies (1) \| Respond to of 95453

I saw the Parade article also. There were some good things to think about, but I must say I can never recall another case where projections that consumption would nearly double over 34 years (2% average annual growth) were considered all that bullish. If that is all the future growth that should be expected in the oil bidness, perhaps PEs deserve to be around 2-5. I had a college physics book that was primarily focused on energy issues. (Guess which decade that was from!) A major theme had to do with "exponential growth." In those days, energy consumption had been rising at annual rates of 7%. Under the rule of 72s, that means consumption doubles roughly every 10 years. If I remember correctly, that also means that for each 10 year period, aggregate consumption would exceed cumulative consumption for all of history before that period. (Example: if consumption from first discovery of oil through 12/31/69 totalled 40 billion bbl, at 7% annual growth, consumption from 1/1/70 through 12/31/79 would be more than an additional 40 billion bbl.) That is why predictions of running out of oil were so dire then. If consumption growth rates held steady at 7%, a doubling of proved reserves only buys another 10 years (beyond prior estimation) till it's "all gone." Even a 10-fold increase in proved reserves would not buy much more time. Anyone have an idea on the accuracy of the 2% figure? It seems absurdly low to me. Paul