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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Aggie who wrote (777)	10/15/1998 11:51:00 PM
From: Razorbak	Read Replies (1) \| Respond to of 2742

They Should Stick to Bingo Jeez, I hope these people don't buy Powerball tickets. They just might storm state capitals, hold legislators hostage, and demand their money back. <g> Razor

To: Aggie who wrote (777)	10/16/1998 10:48:00 PM
From: Tomas	Respond to of 2742

The Falklands: "What the first 4 wells have proved really beyond question is that all of the requirements necessary for the finding of commercial oilfields are present" Another well closes: How much longer will the oil industry keep looking Falkland Island News Network 16 Oct 1998, From J. Brock (A Report For Calling The Falklands By David Wood 13/10/98) Sodra has announced the closure of its well in Tranche "F" after finding source rocks but no economically viable quantities of oil. Two more wells will definitely be drilled and after that a decision will be taken about the viability of continued drilling. With the current low price of oil on the market, there is a chance that exploration could be halted, for the time being at least. Desire Petroleum has a 12.5% share in Sodra and I asked its Chairman, Colin Phipps, what he thinks of the closure. CP Although it is disappointing that in the first four wells we haven't found an economic oilfield it is very early days, of course, within a brand new basin like this and what the first four wells have proved really beyond question is that all of the requirements necessary for the finding of commercial oilfields are present. The job now is for the geologist is to try and get all of those factors together in the same place so that we will find an economic oilfield. DW Now people will say, obviously, that you are going to say things like that and you are bound to be optimistic because it's interests but, things don't look particularly good, do they? You must be disappointed. CP One is always disappointed to drill dry holes but (I'd have to point out) it was somewhere between thirteen and nineteen wells were drilled before the first economic accumulation was found. Certainly in the exploration business you have to be optimistic. Otherwise you wouldn't go on and drill your next well. DW Are there any of the other oil companies that look likely to give up soon? CP I think that clearly that's a question you will have to ask the other oil companies but I think everybody knows that because of the current price of oil there are a lot of companies that are drawing in their exploration budgets at the moment, not just in the Falklands I might say but all over the world. What effect that will have upon drilling is really a function of how successful the last two wells are. If the last two wells find something then that triggers a number of commitment wells from all of the licensees which, I would imagine, would result in the rig staying in the Islands and additional wells being drilled. The cost of taking the rig out and bringing it back in again would be astronomical. DW Presumably with the price of oil as it is at the moment, so low, companies aren't just looking for something. They are looking for a hell of a lot of something. CP Certainly the bigger companies are and indeed all of the companies are looking for something that will be economic. Now, the size of a field which is economic is obviously a function of the oil price and what was economic twelve months ago would not necessarily be economic today. Equally, of course, we don't know in twelve months or in two years' time what the oil price will be. DW We know the next two wells are going to be drilled. Even then that would make far fewer than ten, and you mentioned in the North sea, thirteen to nineteen. Is that giving the North Falklands Basin a big enough chance in terms of finding oil? CP If the current wells, or the next couple of wells are not successful, it is possible the rig will go away because the oil price at the moment is not encouraging companies to explore. It doesn't follow from that, of course, that within the next couple of years, if the oil price rises and also with perhaps some additional thinking, that the industry won't come back and drill some more wells. I think it very probably will. I think it will be very very surprising if, given the degree of encouragement we've had to date, the oil industry were actually to give up the North Falklands Basin on the basis of six wells. I think that's very unlikely. sartma.com

To: Aggie who wrote (777)	10/26/1998 7:07:00 AM
From: Tomas	Read Replies (1) \| Respond to of 2742

Keep the Faith: Best advice to North Falklands Basin investors By J. Brock, Falkland Island News Network 25 October 1998 Recently there have been some very disappointing events in the North Falklands Basin and those who have a good deal of their hard earned cash invested in oil stocks are now feeling a bit like a faith healer with an incurable disease. The IPC exploratory well, which was being drilled in Tranche "F" by Borgny Dolphin was stopped well short of its expected depth. The North Falklands Basin has a lot of potential: Source Rock, Sandstone, Good Structures and on two exploratory wells, minor hydrocarbon indicators and indications of hydrocarbons at various levels. After having drilled four wells, this is an excellent result. There are few minor drawbacks in that in some areas the structures are badly fractured and on one reported occasion an exploratory well drilled through volcanic rock. Those in the oil business who are "in the know" express the hope that the North Falklands Basin could potentially be as big an oil province as the North Sea. Indeed, the trade papers made a meal out of that hope and gave each Falklander $7.5Million to play around with. However, it is that kind of hope that only makes you smile when your ship is going down. Truth say, even though we have estimated the size of the reserves, we still do not know how much oil is actually in the North Falklands Basin. The frustrating aspect for all investors is that there can be no answers to some real hard questions until we actually strike oil in commercial quantities. To find any oil in those kinds of quantities will take a lot more than just ten exploratory wells. So, if there is such great potential, why is the exploratory programme stopping after 10 wells? Firstly, entities participating in exploratory drilling in the North Falklands Basin are obligated to drill only two exploratory wells. This is the main answer but other factors figure into the equation. One only has to digest the business output on radio and on television to discover that world-wide, economic growth is slowing down and there is mounting talk of recession. Indeed, most analysts will say that approximately 40% of the world's markets are already in recession. This means less money for businesses and that includes the oil biz. In the smaller oil companies there is precious little or no money at all for exploration. Larger companies, like Shell, are tightening their belts and looking for value for money by selling off less profitable oil wells and fields and have just recently, announced the closing of their London Office. To this scenario, we add the exceptionally low price per barrel of crude and it means less money to spend on exploration and a lower priority for the North Falklands Basin to get those exploration Dollars. Exploratory money will be spent more on areas where the risks involved in finding oil are better. For investors this could spell disaster only if they lose heart and sell off stock that one day could be worth a lot of money. The North Falklands Basin story reads a little like the Biblical parable of the pearl of great price. Just because oil in viable commercial quantities has not been found, yet, in the North Falklands Basin, it doesn't mean it is not there. Investors need to "keep the faith" and tough it out during some very uncertain times. It's not only the price per barrel rising that will bring those exploratory companies back but it is also the advances in exploratory technology that are about to take place. These advances are not revolutionary but are improvements on what is already available. It is the combination of the Faith, first of all, that the oil is there, hope that technology will advance far enough to make exploratory drilling more efficient and cost-effective and finally that intuitive love of the business which all serious investors possess. Hang in there. sartma.com