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

To: Buckey who wrote (6372)	5/3/1999 11:51:00 AM
From: Dilution	Read Replies (1) \| Respond to of 24892

Buckey John, Pinnacle Oil's SFD jeopardizes all Canadian Oil companies that do not have a license to the SFD. None will get one either. Pinnacle, Encal, and Renaissance will be the only three using the SFD in Canada. The SFD promises to be the Holy Grail. It supposedly detects the boundaries of the structure as well or better than seismic, detects the presence of hydrocarbons vs. water, and does it in near real time from an airplane going 150 miles an hour. Think of the implications for Canadian companies because of the Crown ownership and the auction process. Companies put up lots of parcels for bid to confuse and divert the resources of competitors from shooting seismic and seeing which parcels have structures. That ends with Pinnacle and the SFD. Now they fly the SFD over every parcel up for bid in days. With the SFD they know which have structures and which structures have hydrocarbons. No secrets from Pinnacle's SFD. Pinnacle and/or the partners bid up the price of all good parcels to the point where traditional companies using seismic can not get a decent rate of return. Why? Because the SFD costs $5-12 a mile to survey and has an accuracy rate on the hydrocarbon detection of 85-100%. Seismic costs on average $10,000 to shoot and interpret and can NOT detect the presence of hydrocarbons. The SFD, according to my calculations, lowers the partner's cost by $2-3 a barrel in exploration costs, not to mention virtually eliminates dry holes. Getting back to the auctions, a non-licensee will either not be able to afford the good deposits, pay way too much for them, or on the structures they do buy, the SFD probably said the structure was water and that company just bought some expensive dirt. A competition killer if there ever was one. Furthermore, up north, there is only a 3-4 month window to do all work when everything is frozen. With the SFD, survey in the summer, post land for bid in the summer, and no one else will be able to do obsolete seismic work to semi-intelligently bid against you. Once again, the SFD stymies the competition. As I have postulated before, purely my guess, given a couple of planes and sensors, Canada could be completely surveyed in 2 years by the SFD. Anything good will be known and SFD partners will own it. Everyone else will own the dry holes. Go to the Pinnacle Oil thread I started to read more. Later, Dilution