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Gold/Mining/Energy : Canadian Oil & Gas Companies -- Ignore unavailable to you. Want to Upgrade?

To: Demetre Deliyanakis who wrote (5406)	9/18/1998 2:53:00 AM
From: Kerm Yerman	Respond to of 24898

Demetre / Internationals Let me first share a view with you that I have expressed before. I'm not crazy for international operating companies. My initial investing objectives were to secure shares in those Canadian companies who operate solely in Canada. It's only been the past two years (during peak drilling) that I have begun to realize one major factor which we should all be aware of. Senior Canadian Oil & Gas Companies must eventually sustain and grow their operations with activity outside of Canada. These companies are being confronted with this challenge for they know in time that Canada's reserves are being depleted and they will get to the point of sustaining Canadian Operations only to offset annual declines in production. You will see the larger Canadian Seniors entering the international arena or increasing their investments for activity outside of Canada. Don't be surprised to see companies like Alberta Energy (mass Canadian land holdings) phase themselves into International activity. Yes, international exposure does present political risk. There isn't a single international major who doesn't operate in a hostile environment somewhere. However, with exception of the Near East, I don't see countries being hostile towards Western Oil Operations, especially Canadian Companies. They need Western technology to fully locate and exploit their reserves. A country like Indonesia may have a change in government, but the impact on foreign oil companies will be minimal. The political environment in Sudan is different. It could be another Columbia where rebels blow up pipelines on a weekly basis. But the infrastructure for the oil consortium will be in place by the end of 1999 and thus far the project is on schedule without interruption. Until all hell breaks loose, one has to view the situation as positive thus far. Keep in mind that the consortium of companies in this agreement are truly international in scope. As I always express, my comments are just one person's opinion, this time it was mine.