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

To: Rod Copeland who wrote (103)	4/28/1999 10:37:00 PM
From: Ed Ajootian	Respond to of 350

From Prudential's Ralph Acompara, on the price of oil per barrel 4/28/99 on the foward price of crude oil Crude oil ($18.00 basis the June Futures contract) has satisfied our secondary objective at $18.23 and appears in the process of consolidatating the most recent runup. Last thursdays interday peak of $18.22 is anticipated to continue to contain near-term . rally attempts. We continue to look for a $17.00-$18.23 range over the short-term Secondary near-term support is now seen at $16.24 major support at $14.13. The long- term trend remains positive with higher targets attainable in the $20.00 $20.80 range. ************************************************************** Congrats buddy, you're back in the black! If oil really does get to $20 I would hedge the hell out of your forward production if I were you.

To: Rod Copeland who wrote (103)	5/2/1999 7:14:00 PM
From: Ed Ajootian	Respond to of 350

Crude price jump tempts drillers back to oil patch By Richard Valdmanis NEW YORK, April 29 (Reuters) - With crude oil prices making a solid recovery from winter's historical lows, some independent U.S. oil producers are warily edging back into the oil patch this spring to make their black gold sprout anew. ''We have a lot of people getting enthused,'' said Daniel Bigs, president of the National Stripper Well Association (NSWA), a Louisiana-based trade group representing more than a thousand small petroleum companies. ''Some of the wells are starting back up, equipment is getting repaired, people are excited. The price surge has given us a lot of hope.'' Independent petroleum companies, which represent more than 40 percent of the U.S. crude production capacity, were hard hit by a severe downturn in oil prices last winter, with about 55 percent of the industry knocked out for lack of profit. With a 60 percent crude price resurgence since February, however, a select few companies, including Lake Forest, Calif.-based Nutek Inc. (NUTK - news), are leading a return by unplugging their wells. Nutek, whose stock is traded on the over-the-counter bulletin board, is located south of Anaheim. ''We are actively working on getting our oil wells back into production,'' said Nutek President Murray Conradie, who announced plans this week to reactivate 25 percent of Nutek's lease holdings. ''With the current oil and gas prices, we must delve into the profit potential.'' Oil prices hit their highest mark in 16 months on the New York Mercantile Exchange (NYMEX) this week at $18.58 a barrel, four months after falling to an all-time low of just under $11 a barrel in December. The price spike is credited largely to an agreement among world oil producers, signed in mid-March, to cut global output by more than two million barrels a day. The break-even crude price for small oil producers in Louisiana, Texas, Oklahoma, and California -- where the majority of small independent companies operate -- averages between $13 and $15 a barrel, according to the NSWA. While the NYMEX surge hints at a solid recovery, the companies charging back to the oil patch are largely regarded as exceptions in the still-ailing industry. ''We're encouraged by the surge, but most of us are waiting for more encouragement before we bolt back in,'' said John Taylor, president of Hiawatha Exploration Co. in Oklahoma, and chairman of the Oklahoma Commission on Marginally Producing Oil and Gas Wells. ''We've been burned badly, and now we're a little wary of whether the prices will hold. Our stats don't show much stirring yet in the fields, because I think if it's happening, it's just starting.'' Trade spokesmen and producers agree, however, that the outlook is good. ''If the prices keep moving the way they've been moving, we'll see that a lot of the guys who had their wells shut-in last year are going to be turning them back on,'' said Don Briggs, spokesman for the Louisiana Independent Oil and Gas Association. ''The business is definitely becoming more profitable.'' ---------------------------------------------------------------------

To: Rod Copeland who wrote (103)	5/9/1999 9:11:00 PM
From: Ed Ajootian	Read Replies (1) \| Respond to of 350

Equity markets reopening to oil, experts say May 5, 1999 By MICHAEL DAVIS Copyright 1999 Houston Chronicle Small oil companies struggling with high debt can likely avoid a trip to bankruptcy court now that equity markets are reopening to energy companies in the wake of higher oil prices, energy industry officials said Wednesday. A variety of debt and equity offerings recently announced have given many companies hope for renewed access to badly needed capital. Just weeks ago, speculation was rampant that a number of small independents would not last through the second quarter without Chapter 11 protection. Anadarko Petroleum on Wednesday closed a 6.25 million-share offering, raising $240 million. Also on Monday, driller Pride International said it will sell $75 million of new shares to investment firm First Reserve Corp. Earlier this week, Key Energy Services said it will sell 55 million shares to raise $165 million. East Brunswick, N.J.-based Key Energy Services is a land-based well servicing company, one of the hardest hit segments of the industry. When oil was languishing at $10 to $12 a barrel, the industry was becoming insolvent and small independents were having their balance sheets destroyed, Matt Simmons, president of Simmons & Company International, said Wednesday at the Offshore Technology Conference. "Most companies need about $16 a barrel just to keep production flat," he said. As a result of pinched cash flows due to low prices, service companies are having trouble getting some customers to pay their bills. Dave Robson, chief executive of Houston seismic company Vertias DGC, said collection problems have been the worst ever in 1999. "Prices are up, but cash flow is not enough," he said. "The equity markets need to step up and provide capital." As prices have moved up -- the June oil contract closed Wednesday at $18.98 per barrel, up 6 cents -- capital markets have opened back up to small independents, said Bobby Tudor with Goldman Sachs & Co. "A window has opened and companies are going to rush into it," Tudor said. But any recovery will be slow. Even though prices have moved back up, companies are still budgeting based on low oil prices, said Don Vaughn, vice chairman of Halliburton. "If prices stay up, we would expect to see some improvement next year, but our clients are currently judging the viability of projects based on $12 oil," Vaughn said. Simmons and Jim Day, chief executive of Noble Drilling Corp., both said there are too many offshore contract drillers and that further consolidation is needed in that part of the industry. "Of the top 10 offshore drillers, there needs to be about half of that," Day said. A hypothetical situation that was raised in another session on Tuesday also arose Wednesday: the merger of an energy company with a large financial services company. The example being bandied about was a merger of Goldman Sachs with Baker Hughes. "I think we could see a surprise player emerge that would be like a combination of Bechtel, GE Capital and Baker Hughes," Simmons said. ******************************************************************* How about taking ROCO Petroleum public? The iron is starting to get hot.