| To: manalagi who wrote (75833) | 12/1/2006 8:47:53 PM | | From: Tommaso | | | | "n ot allow for selling or buying naked put unless it is buying married put. "
I should hope not. Also, no naked straddles, please. As they used to say in French provincial cities, "La modestie est morte!" |
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| To: energyplay who wrote (75829) | 12/1/2006 9:55:55 PM | | From: rolatzi | | | | Check out TITUF. It's a start up company that extracts Titanium and Zirconium from the remains of the oil sands after processing of and extraction of the oil. They also get secondary yield of oil from their processing.
Rolatzi |
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| From: ChanceIs | 12/1/2006 9:55:58 PM | | | | | | Private Equity Stalks Oil-field Services
Bear Stearns
DEMAND FOR ALL TYPES of oil-field services is strengthening and the outlook for 2007 is for further demand growth.
We continue to see ample signs of capital discipline among the major oil-service and drilling companies, with less-than-expected new capacity being added. This discipline suggests that the current business cycle may be longer than past cycles.
CEOs are dissatisfied with the valuations of their companies, and now seem comfortable with the idea of taking on debt to repurchase shares if the low company valuations get lower.
Houston is "crawling" with private-equity firms looking at companies that could be taken private in a leveraged buyout (LBO). More CEOs believe that LBOs are plausible, and that a transaction might occur soon.
We continue to believe that National Oilwell Varco and Transocean are deeply undervalued by the public market, and have the greatest near-term appreciation potential of the companies we cover.
Wednesday we sponsored investor meetings in Houston with the CEOs of National Oilwell, Transocean, Smith International, GlobalSantaFe, Weatherford International and Grant Prideco. The mood of the CEOs is decidedly upbeat with respect to the growth prospects for the industry through at least 2010.
Demand for all types of oil-field services is strengthening and the outlook for 2007 is for further demand growth. The North American oil-field-services market could weaken modestly, they concede, if we have a warm winter and low gas prices at the end of winter.
But they are seeing no signs of customer behavior that suggest an inclination to cut back drilling in 2007.
If we do see a downturn, it would likely be a short one, in the opinion of the CEOs we talked to. In the international arena, most oil-services companies are already sold out in terms of their capacity in 2007.
-- Robin Shoemaker
-- Jason Strominger
-- Mark Brown |
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| To: Wyätt Gwyön who wrote (75832) | 12/2/2006 12:40:03 AM | | From: ianbooks2000 | | | | | You can accomplish the same thing on US Yahoo. I have Canadian, Norwegian, British, and Danish stocks listed by their native symbols, the prices (20-min delay) come up in $C, kroner, or what have you, and the holding value is shown in US$. I haven't crosschecked the forex values, but they look pretty close. |
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| From: quehubo | 12/2/2006 9:06:21 AM | | | | | | 118 gw hdd through TH, without the holiday weekend we should have around -11 bcf reported this TH.
With the holiday zero to -5 seems more likely.
ftp://ftp.cpc.ncep.noaa.gov/htdocs/temp/wheat.states
ftp://ftp.cpc.ncep.noaa.gov/htdocs/temp/wheat.states
The forecast is for 200 gw hdd through TH. This should bring the next report closer to -130 reported or -19 bcf per day Friday through TH. Robry certainly does not show anything near that yet. |
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| To: quehubo who wrote (75845) | 12/2/2006 9:08:35 AM | | From: Bearcatbob | | | | | 25F in Cleveland and windy. I much preferred last weekend with glorious bike rides in beautiful sunny weather. What is the commercial about "priceless". Oh well - I guess I will settle for portfolio profits. However, at this stage of life I think I prefer the bike rides! |
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| From: CommanderCricket | 12/2/2006 9:33:52 AM | | | | | | For all those who think the people closet to action "know" where prices are going, you've got to read this.
"Snip"
Since Apex hedged zinc at around $.48/lb., at $2.04/lb. for zinc, that's a mark-to-market loss of $1.56/lb., or $1.2 billion dollars, since Apex still has not yet started to mine any zinc. That's a larger loss than the market cap of Apex Silver! Apex also has losses on the silver and lead. Apex also sold 1/3 of their hedging liability, and 1/3 of their project to Sumitomo. Apex has not yet covered the majority of their hedges, claiming that their future losses will be realized as they come due, since they hedged 358,150 tonnes of zinc, silver, and lead for up to 7 years.
"Perhaps many end users are not paying $2/lb. for zinc at all!" ... Jason Hommel
Zinc Mystery Unveiled?
Silver Stock Report
by Jason Hommel, December 1, 2006
I have been perplexed as to why LME zinc inventories are continuing to rapidly shrink, with the current high price for zinc having so little impact to discourage zinc depletion.
It's like watching a train wreck in slow motion. Aren't high prices supposed to slow down consumption?
As I have explained previously, zinc inventories of 85,000 tonnes will last about 85 days at current depletion rates, whereas zinc inventories need to last about 700 days, or two years until new zinc projects come on stream.
See: Zinc Prices set to continue to explode
silverstockreport.com
Why can't the owners of zinc figure this out?
This appears to indicate that we will see an explosion of zinc prices within the next three months, in my opinion, which is needed to slow or halt inventory declines.
But why are zinc prices not already higher--high enough to slow down the inventory drawdown to sustainable levels? What explains why zinc inventory drawdowns are seemingly not affected by the existing high zinc prices? How much higher do zinc prices need to go? What is going on in the zinc market?
About 60% of zinc is used is galvanized steel. Zinc is about 3% by weight of galvanized steel, on average. Since zinc is a minor ingredient in steel, the market can sustain and tolerate and absorb substantial price increases. I explained this previously, in my article where I noted that zinc was up by "60% in 60 days!"
silverstockreport.com
So, moderately higher prices will not significantly slow down demand, and are already high enough to stimulate explorers and investors--even though it takes years to set up a large scale mining operation like you see on "Modern Marvels".
But here's something else to consider.
How much zinc is traded on the spot market verses the futures markets? I don't know. Derivatives can be a big problem, and in my opinion, may be thwarting the free market process whereby higher prices are supposed to cause reduced demand.
Perhaps many end users are not paying $2/lb. for zinc at all! Perhaps many end users are still only paying about 50 cents per pound of zinc! And thus, there is still little incentive for many zinc consumers to conserve zinc usage. How is this possible? Stupid miners hedged!
Apex Silver and Penoles are two miners that I know of that have hedged zinc. But how widespread was this practice, and how much damage has it caused, and will it yet cause? I don't yet know, but perhaps someone else will find out.
Apex Silver hedged, 358,150 tonnes of zinc x x 2204lbs./tonne = 789 million pounds.
See silverstockreport.com
Since Apex hedged zinc at around $.48/lb., at $2.04/lb. for zinc, that's a mark-to-market loss of $1.56/lb., or $1.2 billion dollars, since Apex still has not yet started to mine any zinc. That's a larger loss than the market cap of Apex Silver! Apex also has losses on the silver and lead. Apex also sold 1/3 of their hedging liability, and 1/3 of their project to Sumitomo. Apex has not yet covered the majority of their hedges, claiming that their future losses will be realized as they come due, since they hedged 358,150 tonnes of zinc, silver, and lead for up to 7 years.
So, Apex may be providing zinc to the market at well below free market prices, about 51,000 tonnes per year, at $.50/lb., for the next 7 years. Perhaps some fortunate end user who will have a tremendous competitive advantage since they will not only get zinc cheaply, but also hopefully won't have to stand in line to get zinc during a time of crisis!
Perhaps this partly explains the upcoming disaster unfolding in the world wide zinc market. I call it a disaster because zinc prices should have risen higher, sooner, to affect all market participants equally, to help to most efficiently and appropriately ration (by price) the remaining zinc that we have left.
Instead, it seems that big companies that made stupid hedging mistakes are continuing to supply many zinc users with sub-economic, low priced zinc, which is not encouraging them to conserve. So, the drawdown of zinc inventories is continuing at an unsustainable pace, and it looks like we'll see either a terrible shortage of zinc, or an explosion of zinc prices.
The key flaw of communism is that when prices for goods are set below free market prices, shortages and misery are always the result. I just don't see how anyone can justify futures contracts as a part of the ideal free market. Futures contracts, by definition, lock you in and force you to perform, and are the exact opposite of freedom.
This analyst says: "I expect zinc to be selling over $2.50 a pound in 2007. After that, sky's the limit. With the right conditions I believe we could be looking at $5 or $6 zinc within a few short years."
marketwire.com
Metalline Mining (MMG on the AMEX)
metalin.com
MMG is my number one stock position, over 10% of my portfolio. I own 400,000 shares of MMG, and 400,000 warrants at $1.25 good for 5 years. I can't sell this until the 1-year hold time expires, perhaps in late January, 2007.
MMG has about 50 million shares fully diluted, at a share price of $4, and is a market cap of nearly $200 million.
MMG has 5.8 billion pounds of zinc resources (More than Apex Silver), and is working on a feasibility study that may take another 1 - 1.5 years to finish. This zinc is all unhedged.
There is a great blog that covers MMG here:
greatinvestments.blogspot.com
Duncan, the author of that blog, just reminded me of MMG's high-grade silver potential, given that I wrote about Coronado with high grade copper yesterday.
Hi Jason -- I was looking at an old 10Q from 2005 (http://sec.edgar-online.com/2005/06/15/0001031093-05-000002/Section3.asp) and found this text about the Polymetallic manto:
"The silver grades have ranged from approximately 10 grams to 50 kilograms (31 ounces per kilogram). One drill hole intersected mineralization with grades averaging 11 kilograms over a thickness of 9 meters (3.28 feet per meter) and copper grades measure as high as 4%, which indicates that the Polymetallic Manto contains very high grade silver, copper mineralization. Work on this mineralization was put on standby in 1999 when the Company recognized the potential of the oxide zinc mineralization as a result of a positive feasibility study conducted for the Skorpion Mine located in Namibia, Africa, that demonstrated that the use of the solvent extraction electro-winning ("SXEW") process could make it profitable to mine oxide zinc deposits that would otherwise be unfeasible."
Duncan writes, "9 meters is more than 27 feet, and 11 kilograms of silver/tonne is worth more than 41% copper. That's over 340 oz of silver per tonne! At the current $13.90/oz price of silver, that's over $4700 per tonne, plus the copper value. That's the equivalent of about 68% copper (about 70% when you add the copper), but better because the fundamentals for silver are much better than for copper."
Timing: MMG has had a good run up recently from about $2-$4/share, so the timing to buy may not be the best if you only consider the stock's chart. However, timing in the silver and zinc markets could not be better than right now, as zinc is hitting new highs, and silver is getting close to break out above $15, and that may over-ride what the MMG chart is saying. Be cautious though, as MMG raised $11 million at $.80/share over a 9 month period a year ago, and most of it was raised around late January as the stock headed toward $2/share as the zinc price began to break out above $.70/lb., and head to $1/lb. Duncan had a price target of $13-21/share, but that was when zinc prices were as low as $1.57/lb. Look for others to take profits from that financing, and as the zinc market heats up over the next several months to two years. The stock could trade between $4-8/share in the next 6-12 months or so. Longer term, blue sky potential is up to $50/share, and I consider it hard to find (but a goal to find) stocks that have potential to rise ten times.
I have purchased a new zinc stock that I learned about at the San Francisco show. I can't yet release the name of the stock, but my paying subscribers can log in and find the new company if they search a bit for it.
You can signup to Look at my Portfolio, for $40/month, here:
silverstockreport.com |
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| From: CommanderCricket | 12/2/2006 9:39:43 AM | | | | | | Calgary Oilpatch Pessimism Running Deep
From National Post:
canada.com
Grim oilpatch anxiously awaits cold weather
Jon Harding and Claudia Cattaneo
Financial Post
Friday, December 01, 2006
CALGARY - To the outside world, Calgary, the centre of the oilpatch, is booming -- office real estate is tight as a drum, retailers are gearing up for a bountiful Christmas haul and labour shortages continue.
Yet in Cowtown's oil towers, pessimism is running so deep the usual Christmas cheer has turned into Christmas fear.
The shop talk on the party circuit: Big oil companies are slashing budgets by the billions, drilling for oil and gas is plummeting, stock options are in the tank, many juniors are headed into a New Year bloodbath, oilsands companies are out of favour and oil and gas trusts are in shock.
All eyes are on natural gas prices and anxiety is high that if cold weather hasn't swept the continent by Christmas, the glut in inventories of the fuel could extend the sector's downturn into late 2007.
By January, with winter well under way, the market will firm up its views of prices for the remainder of the year.
If the outlook is going to be weak, it'll be tough slugging, say analysts.
Canaccord Adams analyst Andrew Bradford said the mood is the polar opposite of a year ago, when business was so good conversations at company Christmas parties were euphoric and revolved around holidays, vacation plans and the latest on the Calgary Flames.
"It's hard not to get a sense of the pessimism," Mr. Bradford said. "A lot of people want to talk about natural gas markets, whether there are too many rigs, issues no one seemed too concerned about last year. It's weighing on people's minds more and more."
The downturn started early in 2006, but was expected to be a blip; the prevailing sentiment was that the boom had long legs amid continuing concern about world energy shortages.
To be sure, oil and gas prices are high by historical norms. Gas was trading at US$8.84 per million British thermal units in New York yesterday, double the September price, and oil was US$63.13 a barrel, up 10% from a year ago.
But this is a different world, as a litany of other factors in Canada have combined to turn the boom into gloom. One energy executive expressed concerns that governments and investors are still talking about dividend hikes when many companies in fact could wind up in a tight squeeze next year.
Rising costs for everything from drilling services to exploration lands have outraged big companies to the point they are slashing plans just to send a message they won't pay up.
ConocoPhillips is said to be planning a $1-billion cut to its 2007 Canadian gas program, down from $2.1-billion this year. That would follow cuts by EnCana Corp. of $1-billion, by Canadian Natural Resources Ltd. of between $1-billion and $1.5-billion.
Cathy Cram, spokeswoman for Houston-based ConocoPhillips, said her company will be spending more money on oilsands development, but less on natural gas in Western Canada because of rising costs and volatile prices. The industry-wide cuts are so deep drilling activity is expected to decline 15% in 2007. Already, the number of active drilling rigs has declined almost 25% from a year ago, and rental day rates are off by $2,000 to $15,000 on average.
Natural gas supply from Western Canada is already taking a hit. Volumes in December are expected to be below last year, and decline 1% to 2% in 2007, said Chris Theal, analyst at Tristone Capital Inc.
Junior producers are also reeling from high costs, but the pain in the group runs deeper because it doesn't have the staying power to also weather low gas prices and rising debt. It got further stung by Ottawa's decision to tax income trusts, which have been buyers of juniors.
Meanwhile, trusts have been paralyzed by the new federal tax rules and are holding back on their plans. Mr. Theal said land prices have already declined 10% to 15% because trusts are no longer bidding as aggressively.
Ryan Ferguson Young, associate at Calgary-based Sayer Energy Advisors, said the market is becoming flooded with new assets and it's going to get worse in January. "We see the number of [properties] available in January rising as high as [collectively producing] 135,000 barrels of oil equivalent a day, compared to June, when there was 40,000 boe/d, which has been the norm," he said.
Is there any upside to the downturn? Mr. Theal predicted a return of mid-sized companies, as strong juniors buy up the weaklings. Investment dealers are gearing up for a flurry of mergers and acquisitions, resulting in an even stronger oilpatch. The deep activity cuts are expected to eventually lead to a strong rebound in gas prices once the glut disappears. |
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| From: Dennis Roth | 12/2/2006 9:56:39 AM | | | | | | Staying Overweight In Energy - Here's Why
Posted on Nov 30th, 2006 with stocks: OIH, USO, VDE
energy.seekingalpha.com
Barry Ritholtz submits: Given yesterday's pop to $62 in Crude -- up from $53 when last month's Futures' contracts expired -- its worth taking another look at energy sector.
I am friendly with David Kotok, Chief Investment Officer of Cumberland Advisors. Like me, David remains Bullish on the Energy Sector, and has had some rather astute comments on Oil recently. Back in September, he wrote:
"Many folks are bailing out of oil. Some forecasts now call for a price decline to under $30 per barrel. One extreme forecast suggests the oil price could go as low as $15. We do not agree.
The recent drop in the oil price from the high $70s to a few pennies under $60 per barrel is the result of the lessening of two risk premia. 1. The hurricane season seems to be passing without incident. 2. The Chavez/Ahmadinejad bluster is known and the market is assuming that we have seen the worst. Some players are suggesting that the European initiative with Iran will succeed and lessen the tensions over Iranian development of nuclear enrichment facilities.
Oil risk premia are estimated by computing the cost of adding a barrel to inventory. This helps explain the pricing of oil in the futures market. When the risk premia declines as it is doing now the nearest term oil price declines the fastest. That is what we have seen in the August/ September period. Longer term futures prices are suggesting that the current decline is nearing an end. Oil for delivery 18 months from now is trading near $68 per barrel."
David's view is that "energy prices are going higher and that our overweight ETF investment position should continue in this energy sector."
He also recently criticized what he termed "the ethanol mess" cumber.com and offered how it didn’t help the energy price -- but it did help create shortages in grains. He notes that some folks in this world are going to starve because of it.
Why does he want to stay overweighted Energy? These factors suggest higher oil prices:
• The dollar has declined about 10% (trade weighted) from where it was a year ago. Oil is about the same price per barrel as it was a year ago. Oil is priced in dollars. Therefore, we in the US have had a price run up to near $80 and back to $60. The rest of the world has had a smaller price run up and is now looking at an oil price 10% lower than it was a year ago.
• The relative price is important because it allows us to estimate the stimulus that occurs from the oil price change in various parts of the globe. In the rest of the world that stimulus has spurred demand. Oil consumption is about 1 ½ million barrels a day (mbd) higher than it was about a year ago. In the US the change has been nearly flat. Our oil consumption is not the growth area. Look to Asia to find it.
• Oil futures prices suggest a return to nearly the $70 level in 18 to 20 months. McKinsey & Co. forecast continuing rise in world oil demand at about 2.2% a year until 2020. We agree. Oil could easily be $100 before then as world consumption rises between 1 ½ and 2 mbd each and every year.
• The unrest in Nigeria continues and may be worsening. Press reports usually do not include this in the top of the list. They should. Nigeria is becoming an increasingly dangerous place for the folks who work in the oil industry. Investors need to keep an eye on this geography.
• Speaking of geography, the Middle East is deteriorating and the market has ignored it. In Iran, we see Russia supplying missile defense material to protect Iranian nuclear sites. We see the breakdown in Lebanon and the Syria-Hezbollah connection strengthen. The Israel-Hamas battle continues unabated. Clearly we see a murderously intense civil war in Iraq. Soon we will witness the forthcoming pullout of the British. What will that mean? They are in the Basra region; that is where a lot of Iraqi oil exports originate. Basra is Shiite and close to Iran which is also Shiite. Instability in Basra is almost certain to rise when the Brits depart. Right now Iraq still exports about 1.6 mbd. As much as half of it is at risk if the civil war spreads and intensifies in Basra. Also, only about 1600 of the 2300 oil wells in Iraq are working. The civil war prevents regular maintenance and precludes development. So every time a well loses functionality it goes offline. We expect that to continue and intensify.
• All this leads to a strange alignment. In Iran, the Shiite center of power, there is an interest in the higher oil price. Iran has no love for the west and would spend the money on the mischief it spreads in the region and on domestic social spending so as to endear the Ahmadinejad regime to the populace. In Sunni Saudi Arabia, they wish to maintain the present oil price or see it a little higher. They do not want to kill the west but they would welcome the higher oil price if the source of the pressure was from other than OPEC cartel price maintenance. So we have both the Sunni power and Shiite power supporting their respective allies who are the combatants on one side of the Persian Gulf while enjoying the benefits of any higher oil price and attendant risk premium. This bodes ill for Basra and any other place where the civil war might spread.
By way of disclosure, Cumberland maintains an overweight position in energy, with the Vanguard energy ETF (VDE) as their first choice. VDE has 118 stocks, with the heaviest weighted components being ExxonMobil (XOM) Chevron (CVX) and ConocoPhillips (COP) Schlumberger (SLB) and Occidental Petroleum (OXY).
Thanks, David. |
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| From: Dennis Roth | 12/2/2006 10:11:30 AM | | | | | | Crude Oil Rally Should Carry into 2007 - Stocks are Leading the Way -
from ChartWorks:: published by Institutional Advisors
Bob Hoye
Technical observations of RossClark@shaw.ca
December 2nd, 2006
321energy.com
For those who love charts, lots of charts. |
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