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Gold/Mining/Energy : KOB.TO - East Lost Hills & GSJB joint venture -- Ignore unavailable to you. Want to Upgrade?

To: grayhairs who wrote (2992)	6/3/1999 1:31:00 AM
From: Kerm Yerman	Read Replies (1) \| Respond to of 15703

Greyhairs / Opinion Bill Rintoul is a great writer and I just wanted to make sure he got the credit for the information. He and Bob Christie are our eyes on events in and around Kern County. My opinion on the ELH play? Absolutely no doubt in my mind that these companies are sitting on something very valuable. I don't have to tell that to most of you on this thread. Time will prove their situation out and patience will prove us out. I read in one report that the public would be aware of the results of two, quite possibly three wells by year end. There will be some heavy number crunching by institutions come the first quarter of 2000, and I suspect we will see a "third" surge in shares of these companies early on in the second quarter. The "first" surge came with the blowout. I said in my newsletter about one month ago that I thought the "kill" wouldn't do much for share prices. My logic was that it was just another step in the process to get down into the targeted formation. However, the step was important to us because we can now envision a timetable, something we couldn't do before. My guess is that we will see some serious play in shares of these companies come mid-August and see a "second" surge between then and mid-October. Until that point in time I expect shares to trade in a narrow range and drift a wee bit higher prior to the second surge. Enough about share prices. If I remember right, there is just a very short history of drilling into the Temblor zone beyond 16000 feet, something like six wells. The play is definitely heating up. Drilling of the oncoming wells mentioned on this thread, (Cal Canal - Lucky Dog - Pyramid) are targeted for the same formations, but at much lesser depths. Any success here, California will see a new black gold rush - or blue flame drive. What looms largest however, is the 2nd exploration well at ELH. It's amazing to me how long the San Joaquin Basin has been successfully active. I have also been publishing information in the newsletter regarding activities of U.S. companies, with focus on exploration nearby activity of Canadian operations. Keep an eye on news related to sizable operators such as NUEVO ENERGY CO (NYSE : NEV). I also noticed people here are always looking for the current best leveraged investments dependent on the players current share price. I do want to mention the Berkley Petroleum may be best suited for those people with less risk tolerance. Their multiple drilling projects are incredible, Alberta Foothills - NWT - ELH. Here's a company expected to provide cash flow per share numbers of $0.75(1998), $1.70(1999) and $2.70(2000). This translates into a cash flow / share price multiple of 4.4X based upon shares at $12.00. That's cheap, or great share value at this time. Come this time next year, shares should command a premium multiple of a minimum 7.0X cash flow for 2000, or $19.00. Here's the kicker, these numbers do not include any further success in the NWT or in particular, the ELH play. The company expects to exit this year at 30,000 boe/d and 40,000 boe/d in year 2000. (70% natural gas) I've really rambled through this message. It's the result of being one tired dude. Anyways, these are some of my opinions. I will say one thing, it's hard to keep up with the posts at this thread.