steve Ward

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184 Comments

    • Thu Oct 23rd 11:30 AM | Rating: 0 0
      Commented on:
      Linn Energy Offers Compelling Story and Valuation
      Upstream MLP's distributions are dependent on their commodity's price. Even if hedged, the hedges last only so long and have to be re-set.

      The odd thing was that oil was going through the roof and the MLP index was crashing to the floor. Apparently the hidden hand of the market was at work here. It was telling us something and I for one wasn't listening, just looking at it with curiosity at the paradox of it all.

      This the 5th or 6th article in the last two weeks on MLP's, upstream and downstream. I wonder if that is a contrarian indicator as all articles have been positive.
      Valuations are relative we should all remember.
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    • Wed Oct 22nd 12:05 PM | Rating: 0 0
      Commented on:
      How to Pick an MLP for This Market
      Those whopping yields are contingent on current and future oil and gas prices along with the expense ratio. Those yields won't last with current pricing unless the hedges were 100percent.

      Mamagement has too much control in an MLP without the corresponding unit ownership. Royalty Trusts are better.
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    • Wed Oct 22nd 11:56 AM | Rating: 0 0
      Commented on:
      Whither Canada's Tar Sands?
      Conventional oil drilling is still the lowest eco footprint of all forms of production. Unconventional drilling and production wants the tax credits to lower the costs under the reasoning of "energy independence". But with the unconventional production comes a very large eco footprint.
      If Obama is elected it will be interesting to see what he does on the energy independence issue with lower oil prices, rising un-employment and carbon credits.
      Maybe, he'll just continue to "study" offshore drilling for 4 years.
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    • Mon Oct 20th 10:28 AM | Rating: 0 0
      Commented on:
      Petrobras: Dead In The Water
      Petrobras was clearly upset with Lula's re-thinking of government ownership of the new field discoveries. Now, PBR may have the issue settled for it by having to give up certain property rights in return for state financing.
      Also, PBR maybe forced to give up future exploration in all other parts of the world in order to fund the new fields. The dividend appears to be gone as well.
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    • Mon Oct 20th 10:17 AM | Rating: 0 0
      Commented on:
      UTS Energy: Risky Play?
      The highest sale for undeveloped oil sands in the ground has been Oxy's purchase of Enerplus' share in the Joslyn Project. at a price of $1.57 a barrel. Most oil sands go for 50 cents to a dollar a barrel. The Joslyn sale was done at much higher oil prices, well over $100.00 per barrel. So it is doubtful that UTS will get a $1.57 if they sold out and distributed their share of the cash to shareholders. If UTS did sell their oil sands assets for the previous high then they would receive about $4.90 per share, considerably higher than the stock is now.

      If they sold at a low of 50 cents per barrel, that would translate into $1.58 per share. Assuming UTS doesn't receive adequate financing for future projects selling out would be the prudent thing for shareholders.
      Current estimates of costs are 80 to 90 dollars a barrel for a 10 to 12 percent return on oil sands projects. UTS has to ask itself if it is worth it.

      UTS is in a good poition to sell to well heeled partners involved in the project. UTS can sell for some cash now and lower its developmwent costs and retain a smaller percentage or sell all its assets for a lower price and retain a royalty on future net production or sell all outright at the highest possible price.

      It is doubtful UTS can achieve the financing necessary to stay with the project with production so far away. UTS should be thinking of its shareholders and how to get them money now.
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    • Sat Oct 18th 13:21 PM | Rating: 0 0
      Commented on:
      Solar Stocks Are Now Attractive Again
      Government subsidies and tax policies on the "Renewables" I believe will be the driving force in any solar stock recovery. The 600 pound gorilla is clearly the next election and what it produces in the way of non-market force incentives.
      Remember, in the US we do not use oil for power generation, so solar only replaces coal, nat gas and uranium. Things we have aplenty and things that are sliding in prices as we speak.
      So government policy will be the determining factor.
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    • Sat Oct 18th 13:15 PM | Rating: 0 0
      Commented on:
      How Low Can Mining Stocks Go?
      The big question for mining and other commodity stocks is as to whether the BRIC's and parts of Asia slow down more than anticipated. Currently, the thinking is that they will but for only a brief period such as 1 year.

      The worst case is thatb they slow down and go into a protracted recession. That is not widely belived in at this moment. That's what gives me pause on buying anything. World growth has been funded by bad debt and cheap money. That has to be reconcilled going forward. We are not there yet.
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    • Fri Oct 17th 21:54 PM | Rating: 0 0
      Commented on:
      Bolivia: A Blizzard of Misinformation on Mining and Everything Else
      The article is interesting from the point of view that Morales' words are for local consumption and not for the financiers.
      It is obvious that Morales wants a better deal but is willing to play ball to get it.
      But will this attitude eventually apply to the oil and gas assets as well.?
      The author should opine on that if he will.
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    • Wed Oct 15th 07:04 AM | Rating: 0 0
      Commented on:
      Has the Energy 'Tsunami' Been Aborted?
      Jim, your $500.00 oil implies a military crisis. No nation on earth can survive that impact without reductions in the economy on a depression level. Even rRssia has found out the limits of oil power.

      However, I agree with your scenario of oil going back up and way up in the 2010 to 2012 range. I agree the crunch is there.

      On the alternative energy front the Democrats are playing a foolish game. Maybe they don't get it and this is sincere stupidity on their part. All the talk they have mustered up about alternative energy is all in power production, not in transportation fuels. That's the rub.
      The US imports no coal and the uranium comes from dis,antled Soviet nuke weapons.
      So we have a 4 trillion dollar state and Fed highway system with distribution points for transportation fuel inundating the country but Obama and McCain will save us from inported oil with tax credits for solar and wind power.
      Additionally, Pickens' plan on compressed NG has to come from shale and other un-conventional sources that require alot of water to frac. If the enviro jihadists are controlling the Dems on offshore drilling wait until the Obama Admin. trots out their land based gas drilling program and all the enviro effects it brings. It will make the offshore controversey look like a Southern Baptist Sunday School Picnic.

      So, no additional gas, no additional oil but all the carbon credits you can borrow on.
      Now that I read my own posting I take everything back Jim, you might be right on $500.00 oil.
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    • Sun Oct 12th 15:30 PM | Rating: 0 0
      Commented on:
      StatoilHydro: Well-Prepared for the Future
      What we "maybe" facing is a depression of different and similar effects of the 1930's. In that depression many commodities fell below the cost of production for years without the beneficial effect of enough shortages to encourage price hikes.

      I too thought the markets would stabilize oil pricing and therefore less investment would produce oil shortages much faster than later. Now I wonder if my own scenario is valid or even reflects a scentilla of the comming reality.

      The whole world was and still is based on unsustainable debt growth, this includes China and Asia more than is being generally commented on.
      China now has announced that they will keep growth going with internal projects. Japan tried the same thing in the 90's and it went nowhere.

      I now view oil (not gas so much) as in a secular bear market until 2012. Oil will not see the likes of 147 dollars until then.
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    • Sun Oct 12th 15:14 PM | Rating: 0 0
      Commented on:
      Oil Industry: Farewell, Good Old Days
      Companies like XOM have the cash to purchase assets on a cheaper basis than what the pricing was in the last year. XOM has been stubborn in its belief that oil and gas pricing was too high for price sustainability nand therefore refused to pay the asking prices of 100 dollar barrel oil for proved and probable assets.

      How long the respite in pricing I simply don't know. But the CHK's of the world are increasingly vulnerable to takeover at a less than desireable price than just 6 months ago.
      OPEC's historical power has not to be able to maintain high pricing but to rather the ability to drag low pricing off the floor.But only after 18 to 24 months of wrangling amongst its members.

      the early predictions of the Exxon's, the Chevron's and the Total's of the world going the way of the Dodo hyave been pre-mature at best and wholly inaccurate at its worst.

      In an age of lower pricing and tight credit who but the well heeled can sit and wait and self fund purchases of assets.
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    • Fri Oct 10th 10:10 AM | Rating: 0 0
      Commented on:
      Roger Wiegand: Oil to Reach New Highs by Year-End
      Better yet, make it 20 pounds, this could be a long lousy market. Anybody see China's electrical demand figures, down they are.What's the backbone of the Chinese Treasury, T-Bonds, CDO's, sub prime debt and exports to the USA, which are down as in down large. Just ask the Mayor of Long Beach California, he keeps numbers on this stuff.
      Asia will revatalize itself, but not until they go through export hell.
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    • Fri Oct 10th 10:03 AM | Rating: 0 0
      Commented on:
      Roger Wiegand: Oil to Reach New Highs by Year-End
      I have been involved with oil and oil companies since 1975 when I went to work for Amoco. The history of OPEC is a complete inability to sustain high oil prices. True, OPEC had in the past un used production leadfing to cheating but the point is the same. OPEC needs as much money as they can get their hands on. Development projects delayed could lead to civil strife as many of these regimes are buying off the populace, ala Saudi Arabia, Algeria and Iran and Venezuela. Historically, OPEC hasn't been able to sustain high pricing.
      However, OPEC is good at dragging low prices off the floor but only after several years of effort amongst its members.
      $149.00 barrel oil? I want 10 pounds of what the Goldman guys are smoking.
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    • Fri Oct 10th 09:50 AM | Rating: 0 0
      Commented on:
      Geothermal Energy Poised to Increase Market Share
      It is now established that EGS causes earthquakes. No more than magnitude 3.3, so far. But France had to cancel her EGS drilling due to the quakes in Basil Switzerland across the border.
      Inm California they are used to earthquakes. In Illinois they're not.
      Until the Richter Scale stops moving on EGS the political fallout from John Q. Public will force the government to shelve EGS in areas not use to earthquakes.
      View article »
    • Mon Oct 6th 13:45 PM | Rating: 0 0
      Commented on:
      Canadian Oil Sands Looks Attractive Despite Near Term Risk
      Added note: I own Crescent Point energy trust and I'm now wondering why I didn't follow my own maxim of "if you have 5 years woth of non-compounded yield in cap gains, always sell." No matter what.
      I guess I'll ride it down with everbody else.
      View article »
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