wingfootedgodhead

Devon Energy: Another Unlikely Buyout Target

Perfect tie up for DVN - CVX, who shares interests in the deepwater Jack complex in the gulf of Mexico.

Exxon's XTO Buy and the Future of Energy Market Consolidation

Chesapeake (CHK) is the queen of the natural gas prodocers with the best acreage position in the gas shale plays and superb economies of scale. Aubrey has quite the ego and I expect he wouldnt sell for less than $60/share which may keep CHK stock price down.

The Anadarko (APC) comparison is really not fair as they also have substantial undeveloped oil discoveries offshore West Africa and Gulf of Mexico. The current stock price for Anadarko is a steal in my opinion.

EIA Natural Gas Inventory: -64 bcf vs. consensus of -45 bcf. Henry Hub futures +6.7% to $5.23.

cold weather plus 9 months of us gas rig counts averaging 700 - just cant keep up with high depletion rates in the shale gas trends.

Shorting U.S. Treasuries: The Best Trade of the Next Decade

My big trade is buying TBT and writing the calls every month for an extra 2% or 3%.

Good chance my TBT will be called away this month but who cares ?

RIM's Crisis Could Be an Opportunity, Again

setting up for a short squeeze --- but the risk is committing too early. no bounce at all since earnings.

disclosure - bought post earnings but have been stopped out of entire position.

Schlumberger (SLB): Q3 EPS of $0.65 beats by $0.02. Revenue of $5.43B (-25.2%) in-line. (PR)

priced for perfection, should open down 3-5%

ETF investors appear to be bracing for a potential long-term bout of inflation, with cash flowing steadily into funds tracking commodities (GLD, DBC, USO), foreign stocks (EEM, VWO, EWZ) and inflation-protected bonds (TIP).

but unsupported by mortgage rates and 10 / 30 year yields at near record lows.

which gives first ?

is this all just currency impact ?

Water: The New Oil

I disagree with the comment that you cant invest in water.

Recently I made an investment in farm property in Eastern Oregon. This land requires irrigation in order to produce. The particular acreage has 1888 senior water rights for 150 million gallons per year.

I expect that at some point the water rights will be considerably more valuable than the land itself.

Bullish Amid Oil Majors' Lay Offs

Discussion with Total management in a key overseas location. They are slashing their 2009 drilling budget by 65% and rigs from 5 to 1.

Their top economic gurus see todays oil prices response as a 'panic' and global energy shortages / $200 oil et al emerging in 2012 versus 2018 the 2018 prediction based on a normal industry investment spend, 2012 on the panic scenario we are seeing today.

Quite a bit of development and exploration spending is being dismantled globally as the operators go into 'hunker down' mode, it will be difficult, costly and take as long as two years to ramp it back up again.

So either the global economy goes into Great Depression II or if you don't buy into that scenario, energy prices will rebound rather rapidly.

Longs today TBT, GLD, CHK, DVN, HPQ and short most of the February calls.

Crude Reality: How Long Can Oil Stay Down?

"At that rate,we would have burned it all in 12 years. Truth is,US reserves haven't budged much in the last 25 years. What we've burned has been replaced by what new technology can get at. Ditto for Saudi reserves. "

Problem - most of these 'depletion replacement barrels' are in the deepwater, the Arctic, Canadian tar sands or difficult foreign countries where it will take the promise of $60/BBL to justify development.

Crude Reality: How Long Can Oil Stay Down?

One blemish in the argument. The worlds existing hydrocarbon reserves deplete at a rate of 7% to 8% per year. The overhang caused by supply / demand mismatch cant last for any more than 12 months.

All this does is make the next leg up much more volatile.

EMC Corp. (EMC) will cut 2,400 jobs, or 7% of its workforce, as part of its efforts to reduce costs by around $350M in 2009 and $500M in 2010. The firm will take a pretax restructuring charge of $248M in Q4.

Frankly I wonder whenever I see one of these restructuring notices I wonder whether or not its the economy or just an excuse for organizations to go out and do some old fashioned pruning of dead wood.

In any organization the heavy lifting is done by the top 20%, the middle 60% are adequate and the bottom 20% offer minimal productivity uplift and should have been cut years ago.

Deepwater Drillers: Not in a Very Deep Hole

The oil companies are looking at 5 to 12 year time lags between exploration and deepwater development. Short term movements of oil prices are of limited impact. Yes there will be some earnings impact as rig rates are negotiated downwards and almost all of RIG's contracts have rate adjustment clauses tied to the price of crude. Cancellations will be minimal and RIG has long waiting lists.

Deepwater drilling is not for the faint of heart with wells costing $50MM to $100MM each.

Transocean is not involved in the land based gas resource plays and is strictly an offshore driller. I would imagine 90% of their fleet is involved with drilling for oil, mostly outside the US Gulf Coast.

Seadrill is a much smaller operator, less a reputation and represents a highly leveraged investment. Be advised. Like someone has commented it will be very difficult to enforce penalty clauses with Petrobras. They are hanging on for dear life.

Recently have went long RIG and SLB and short the January 09 calls for a trade.

Google: Chrome, Android and The Cloud

Closed Friday just at the $463 resistance levels. You got to like the fundamentals -- but can it hold the $463 resistance through options expiration. Disclosure - Long 2200 shrs @ $481, Short 22 contracts September $480 calls @ 17.80

The Long Case for GE

Currently long 5000 shares at $28.34. I get in at around $28 and exit at $29 with call writing providing additional income. Good stock and as mentioned the dividend is a big plus.

Not mentioned that GE has invested in oil service related companies via their Vetco Gray and Sondex acquisitions. Vetco Gray is very tied into subsea drilling although there are more focused ways to play that segment.