lebur

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    • Mon Jun 23rd 19:01 PM | Rating: 0 0
      Commented on:
      Energy Demand: China vs. the World
      On one side is increasing Chinese and other consumption. On the other is the annual DECLINE in the productivity of the major producing oil fields, which appears to be close to 3-4 million bbl/day/year. This requires, to stay EVEN with current production, discovering and producing the equivalent of about one IRAN every year. The COST of new oil is generally FAR ABOVE historical norms. Drilling offshore 100 miles under 6,000 feet of water to a depth of 15,000 feet and even more is a $100 million dollar investment. Not very long ago a million dollar well was a BIG investment. Even new discoveries will NOT lead to yesterday's oil prices. It is a mistake to look for facile single factors to account for the rise in oil prices. Speculators cannot store very much oil. The fact that the US has accumulated 700 million bbls over decades, which is a 35 day supply at today's consumption rate, illustrates the overwhelming influence of CURRENT supply and demand in establishing oil and refined product prices. Producing more liquid hydrocarbons is one way to hope for relief from high prices. Conserving your USE of them is another, not easily done by long-distance commuters in low-density regions that evolved in the cheap energy, automobile era. About half the oil we use in America IS used in cars and trucks. Even if we used NO OIL for these moving users, we would STILL be importing oil for multiple other uses.
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    • Fri Nov 30th 00:40 AM | Rating: 0 0
      Commented on:
      Dividend Analysis of Suncor Energy
      confirm #225166
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    • Fri Nov 30th 00:37 AM | Rating: 0 0
      Commented on:
      Dividend Analysis of Suncor Energy
      Consider Canadian Oil Sands. It currently pays $2.20/yr, selling in CA for about $35. There seems to be a very high likelihood that, by the end of December, the dividend will rise again, as it has repeatedly done in recent years. Production is still rising compared with former years, and is likely to increase as much as 10% more in the next twelve months. Its increased earnings are NOT simply the product of higher prices for oil. Production increases would account for something like a 40% increase in cash flow, even if oil stayed well below $70/bbl. Its market cap is way below that of SU, but the partnership, SYNCRUDE, in which COS is about a 37% partner, is larger than SU with reserves equally long if not longer, extending for some 25-40 years at current rates of production. Even the latest Alberta royalty regime, to which both COS and SU have a long-standing legal exception lasting for many years, willl not have a material effect on future cash flow or dividends even if COS were to agree to adhere to it in it entirety. Despite these considerations, despite the acceleration of crude prices far beyond the baseline used by the company to project its future prospects, COS sells at a historic high right now in terms of capitalizing its market price. A return to fomer levels of capitaliztion would approximately double the price of the stock before too long!
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