NZ Oil & Gas (NZO)

[Unicorn]

I think the point to realise is that most Brokers analysies assume a price of oil of less than $US100. The price of oil is volatile and I agree with KiwiBear that oil could turn south again and test lower levels e.g. $105. But from there it goes up. $150 plus. Demand destruction may delay it but it will get there.

As I posted before, the NZO result on Friday is going to be BIG. It will remind me of Cassius Clay after he beat Sonny Liston.

" I shook up the world!!!!! " ( and I have only had half a glass of red ). I have been waiting for this for four years. It is going to surprise a few...especially in this dull old investment climate. Got your champagne ready Digger?

Hi Bermuda

A few things to consider prior to the release of the results ...

With the new financial reporting rules taking effect for this set of results, will NZO need to revalue their PRC holding at market and report that as part of the profit for the year?

NZO has amortised part of the cost of Tui, and thereby artificially reduced profits reported thus far. But with the increase in announced Tui reserves, there is theoretically more oil in place now than there was a year ago - which in practical terms makes that amortisation rather illogical. Will the additional reserves reflect in an increase in nta and/or profit?

With a week to go until the end of August it looks like Tui will produce about 2.25M barrels in the first 2 months. This is a quarter of the forecast production for the year. Is the forecast starting to look conservative, even at this early stage?

[fish]

I think the point to realise is that most Brokers analysies assume a price of oil of less than $US100. The price of oil is volatile and I agree with KiwiBear that oil could turn south again and test lower levels e.g. $105. But from there it goes up. $150 plus. Demand destruction may delay it but it will get there.

As I posted before, the NZO result on Friday is going to be BIG. It will remind me of Cassius Clay after he beat Sonny Liston.

" I shook up the world!!!!! " ( and I have only had half a glass of red ). I have been waiting for this for four years. It is going to surprise a few...especially in this dull old investment climate. Got your champagne ready Digger?

Spoke to digger a couple days ago-he sends his apologies-has moved house and is waiting to get new links set up .

Looks to me that you are going to be very close to your prediction of $1.70 this week-might even prove to be a little conservative by friday afternoon .

[troyvdh]

...bermuda...tell me have you ever witnessed a profit like that posted by AWE..........

i hope your right .....but what was the response by the market ....?....

[bermuda]

...bermuda...tell me have you ever witnessed a profit like that posted by AWE..........

i hope your right .....but what was the response by the market ....?....

That is what I meant by my earlier post about NZO hitting 170. It was made I think just after the AWE result came out and the sp had climbed to a daily 15% rise.( when NZO was about 150 ) I thought if AWE can show a 15% rise on that result,..so can NZO...and some.

AWE, a licence to print money. And NZO is getting to be the same way.

NZO, very undervalued. Let's see what the market thinks on Friday. Cheers

[Nitaa]

That is what I meant by my earlier post about NZO hitting 170. It was made I think just after the AWE result came out and the sp had climbed to a daily 15% rise.( when NZO was about 150 ) I thought if AWE can show a 15% rise on that result,..so can NZO...and some.

AWE, a licence to print money. And NZO is getting to be the same way.

NZO, very undervalued. Let's see what the market thinks on Friday. CheersBermuda. i must say that you should consider being a full time trader. Since your call the other day, brokers and alikes heard you and automaticall shunted the sp up 12 cents in just over 2 days.

Perhaps you can consider running seminars for day traders.

IMO there are 2 main reasons for the suppresed shareprice in awe, nzo and tui. although they are producing many pundits see price of oil may reduce significantly therefore analysts are still basing their estimates on oil beingh around the $50 mark imo. The other obvious reason is the credit crunch that has squeezed money supply and confidence

It seems crazy the likes of ppp is where it is. I was fortunatel and sold most of them at 35 cps about 12 months ago for a rediculious profit. now at around 28 cpsoil prices have increased heaps, $NZ has fallen, reserves have increased but the sp has langashed. people will wake up soon and i dont think AT or TR cares one hoot what the sp is right now. They will and are smiling all the way to the bank.

[AMR]

I was reading up on CVN today but I did manage to catch a bit about AWE. Brokers are quite bearish on it due to Tui's decline in the future. NZO has Pike and Kupe so a much better investment. I hope Maitland can fill Tui's shoes when it comes in for PPP.

I wouldn't be too concerned about the annual report. These things cause blips but nothing over a longer term. The quarterly caused only a two day spike in the share price. And as of these few days the trend is up. I buy back in soon.

[sideline]

.....................many pundits see price of oil may reduce significantly therefore analysts are still basing their estimates on oil beingh around the $50 mark imo. ............


I found an essay titled "Oil turbulence in the next decade" downloadable from http://www.clingendael.nl/ciep/publications/?id=7105&&type=summary rather enlightening.
The outfit (CIEP) seems pretty conservative and claims to be endorsed by BP, Shell, Total etc.

About the OIL PRICE they say:

Until recently the oil price was largely underpinned by the marginal cost of the last
barrel needed to match demand, with some political and economic conjuncture mark-ups or -downs.
This currently puts a structural floor of $110 a barrel under the oil price (WTI).

The largest part of the $110 a barrel floor (about 70-75%) is determined by the marginal
cost of supply, currently around $80. The remaining $30 a barrel (or 25-30%) is determined
by supply-demand fundamentals, a short-term risk premium, and long term scarcity and policy.
.....

[Bilo]

.......a bit about AWE. Brokers are quite bearish on it due to Tui's decline in the future. NZO has Pike and Kupe so a much better investment.

As soon as you mention "broker" I read person licensed to sell and appraise" (Oxford dictionary. Not necessarily capable of giving you a good steer...

I am not sure how many of you noticed the latest change in the shape of the Tui field diagram. As DS has commented previously when the consortium conservatively increased the reserves yet again; " it is just much bigger than we originally thought".

Hopefully the following two pictures illustrate my observations...the shaded areas have grown!

You should be able to see that Tui could be at least twice as large as currently booked. Future decline? We haven't seen much of it yet.:D

But to take a leaf out of the broker's book - do your own research. This is just my humble opinion. Exploring close to where you have already found hydrocarbons has to be the way to go, also a saying borrowed from DS.

[Corporate]

Oil at - 118.34, up 2.07 as i type this! Star alignment!

[JBmurc]

Oil at - 118.34, up 2.07 as i type this! Star alignment!

Too right----- Cash at bank + current cashflow +forward cashfows =massive market rerate tomorrow
-Glad to have a ASX CFD long in place at 118 target sell high 130's-low140's

-a special divie would really be the kicker to the SP eitherway NZO will be in the spotlight after the annoucment ....New highs?? soon

[fish]

[QUOTE=Bilo;220409]
You should be able to see that Tui could be at least twice as large as currently booked. Future decline? We haven't seen much of it yet.:D

Quite right Bilo-tui is growing !

Tui Oil Production since 1 July 2008:

1 July-27 August: Approx 2.1 million barrels. NZOG's share of production approx 260,000 barrels
Or nzo gross income from tui in first 8 weeks of this financial year=$38.8 million dollars.
We are going to hear great financials tomorrow.
No doubt nzo will remain giving conservative predictions but really is tui only going to produce another 6.9 million barrels over the next 44 weeks (9 million predicted ) or do they need to upgrade yet again production rates
Average nz dollar price at $185 a barrel is also way up on last year .
Dont forget this year we will have interest credit (on 300m ) rather than interest costs .
Its on the cards that this years net income will be as good as last years -additionally might be another windfall if prc is sold .
Its strange the market appears blind to tui ,s production figures but reacts strongly to changes in POO

[Bilo]

[quote=Bilo;220409]
You should be able to see that Tui could be at least twice as large as currently booked. Future decline? We haven't seen much of it yet.:D

Quite right Bilo-tui is growing !

Tui Oil Production since 1 July 2008:

1 July-27 August: Approx 2.1 million barrels. NZOG's share of production approx 260,000 barrels
Or nzo gross income from tui in first 8 weeks of this financial year=$38.8 million dollars.
We are going to hear great financials tomorrow.
No doubt nzo will remain giving conservative predictions but really is tui only going to produce another 6.9 million barrels over the next 44 weeks (9 million predicted ) or do they need to upgrade yet again production rates
Average nz dollar price at $185 a barrel is also way up on last year .
Dont forget this year we will have interest credit (on 300m ) rather than interest costs .
Its on the cards that this years net income will be as good as last years -additionally might be another windfall if prc is sold .
Its strange the market appears blind to tui ,s production figures but reacts strongly to changes in POO

43750 bopd -A modern day Rumplestiltskin down there - someone is turning water into oil:D

[Corporate]

[quote=fish;220604]

43750 bopd -A modern day Rumplestiltskin down there - someone is turning water into oil:D

I'm sure production has only been about 35bopd this financial year....or wait a minute are you talking since production?

[fish]

[QUOTE=Bilo;220618]

I'm sure production has only been about 35bopd this financial year....or wait a minute are you talking since production?

since 1st july-its posted on the nzog website under tui-even has the price tui averaged in nz dollars each week
actually its 37500 per day-including some down days

[Corporate]

[QUOTE=shephejame;220620]

since 1st july-its posted on the nzog website under tui-even has the price tui averaged in nz dollars each week

yeah but 2,100,000/58 = 36,206, nothing near 43,750

[fish]

[QUOTE=fish;220623]

yeah but 2,100,000/58 = 36,206, nothing near 43,750

sorry -I never quoted 43750
must admit on checking my figures i said 38million for gross income first 8 weeks producion but now find it equalled 48 million-better check my figures
Price oil is still rising tonight -oil rigs being evacuated in gulf mexico
Tomorrow onwards should be fun for nzo holders

[Corporate]

[QUOTE=shephejame;220624]

sorry -I never quoted 43750
must admit on checking my figures i said 38million for gross income first 8 weeks producion but now find it equalled 48 million-better check my figures
Price oil is still rising tonight -oil rigs being evacuated in gulf mexico
Tomorrow onwards should be fun for nzo holders

Good call - it was Bilo that said 43750.

If productions remains as it has for the first two months of the year and the POO remains relatively consistent we could be in for circa $250 million revenue for 08/09.

[Chalice]

New Zealand Oil & Gas (NZOG) is expected to report an "outstanding" result for the past full financial year - on the back of strong oil production and record global prices - with more than $100 million in after-tax profit positioning it well for future growth.

In New Zealand's present recession-headed downturn, the ill-effects of the global credit crunch are finding their way on to the majority of balance sheets.

NZOG is expected to have one of the strongest results of the present financial reporting season when it reports today.

ABN Amro Craigs broker Peter McIntyre said NZOG was in an enviable position compared with many companies, with cash in hand of $280 million ($4 million last year), and growth potential on several fronts, ranging from its present assets to new opportunities.

"NZOG couldn't have timed its production run better in a year highlighted by record, sustained global oil prices," he said.

ABN had upgraded NZOG's 12-month share price target by 4.4% from $2.27 to $2.37 and described the company as an "excellent local opportunity" for New Zealand investors wanting exposure to the global oil market and carried a "buy" recommendation.

Mr McIntyre noted the Tui field was providing all the field owners with $890,000 revenue per day.

For every $US1 dollar fall in international barrel prices, Tui lost $US5000.

However, for every 1% decline of the New Zealand dollar against the US dollar, Tui recouped $US12,000.

NZOG's 12.5% interest in the offshore Taranaki Tui field had produced oil beyond expectations - more than 15 million barrels - with its estimated reserves having risen, and its 15% interest, Kupe, would likely see oil and gas production begin by mid-2009.

NZOG had paid its first dividend in a decade, of 5c, in April, with ABN forecasting subsequent annual dividends of 5c, 10c and 11.5c, which equated to dividend yields rising from 3% to more than 7%, Mr McIntyre said.

ABN is forecasting an after-tax profit of $103.6 million, compared with $6.3 million a year ago before Tui came fully into production and global oil prices began steady rises to a record $US147.17 in early July.

Oil was about $US114 this week.

Mr McIntyre said the oil "bubble" had burst in recent weeks, lowering the record prices, and while predicting NZOG would lose some revenue as oil eased towards $US100 per barrel, the weakening of the New Zealand dollar could offset some of that downturn.

He said NZOG had signalled a divestment of its share in listed high-quality coking coal company Pike River Coal on the West Coast, which NZOG spun off in May 2007 dropping its holding from 61% to 31%.

NZOG would expect to get a good price for its shares, and would look elsewhere for more oil-orientated investment - possibly in Taranaki, overseas or in the frontier Great South Basin.

[fish]

[QUOTE=Chalice;220668]New Zealand Oil & Gas (NZOG) is expected to report an "outstanding" result for the past full financial year - on the back of strong oil production and record global prices - with more than $100 million in after-tax profit positioning it well for future growth.
report is out
5 cent fully imputated dividend
brilliant

[Taijon]

All good stuff and another 5 cents per share dividend. Mr Fish will be pleased!!!!!!!!!!!!

[Drone]

All good stuff and another 5 cents per share dividend. Mr Fish will be pleased!!!!!!!!!!!!

Headline result perhaps slightly lower than expected but divvy should be supportive.

[sideline]

Excellent result, and still a PE of 6.7
Plenty of room to rise.

[upside_umop]

Result below most analyst expectations - average around the 38cps according to asb.
Yes - divi lovers will be happy. Only another $20 million from their almost $100 million profit..thats reasonable...all up will be $40 million per year, which should be sustainable. Really didnt think DS would bail on his words earlier. All good though.

And the kupe cost pressures, as we knew about, finally came out. The dividend should offset any hardfeelings about this..will see how mr market interprets it.

[Casa del Energia]

Most significantly....

"We have been systematically screening opportunities, both in New Zealand and
overseas, and we look forward to bringing the best of these into our
portfolio, commencing in the current 2008/09 financial year."

[Hoop]

All good stuff and another 5 cents per share dividend. Mr Fish will be pleased!!!!!!!!!!!!

Yes It is nice to see that NZO management has celebrated their cash windfall with their shareholders. ( AWE management :p ).
This is especially good news for margin holders. I would like to think that NZO had them in mind when accessing their dividend policy for this period.

NZO Management should give themselves a pat on the back for their performance in the last 6 months...well done.

Disc hold no NZO or AWE

PPP FBU MHI STU HBY cash 60%

[Chalice]

Result below most analyst expectations - average around the 38cps according to asb.
Yes - divi lovers will be happy. Only another $20 million from their almost $100 million profit..thats reasonable...all up will be $40 million per year, which should be sustainable. Really didnt think DS would bail on his words earlier. All good though.

And the kupe cost pressures, as we knew about, finally came out. The dividend should offset any hardfeelings about this..will see how mr market interprets it.

Fortunately 40% of the Kupe cost increase is the result of enhancements to the original project scope - the other 60% should be offset by liquids prices (oil and LPG) having risen strongly. As Kupe funds are held in USD the depreciation of the NZD may help mitigate increased local costs such as labour???
As the expected return on investment in Kupe has increased significantly so maybe the increaed costs are covered from initial cost/investment/ROI statements anyway.

Interesting to see the carry value and market value of Pike differ postively by $140 million, which will be recognised upon sale.

Also the interest from the cash funds invested in short-term banking facilities may be payable at end of term, so potentially another boost to come in the next quarter or 3.

Looks like a few disgruntaled SP performance holders are taking the opportunity to bail - will be interesting to see what the close is.

[Flintstone]

http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10529630

Tui oil sparks profit surge at NZOG - $97.2m for the year
10:15AM Friday August 29, 2008

New Zealand Oil & Gas has posted a surge in full year net profit to $97.2 million on the back of production from the Tui oilfields off the Taranaki coast.
"This outstanding result was built on a combination of high oil prices and higher than expected production from Tui," NZOG said today.
The result for the year to the end of June compares with a figure of $6.8m the year before, restated for new accounting rules.
Revenue for the year rose to $234.1m from a restated $4.2m in the previous 12 months.
Earnings before interest, tax, depreciation, amortisation and royalties were $187.7m, with total revenue from Tui of $222.8m and a gain of $10.8m from the float of Pike River Coal.
Production from Tui started on July 30 last year, with total production for the financial year at 14.2m barrels, of which NZOG's share was 1.8 million barrels and the average net sales price just under US$100 ($144.44) a barrel, the company said.
NZOG achieved project "payback" - recovery of all exploration and development costs for the Tui Area Oil Project - by December, just 4-1/2 months from production start-up.

The company's cash balance had risen to $285m from $256m at June 30, and it was well positioned to pursue new investment opportunities.
NZOG chairman Tony Radford said the company had been systematically screening opportunities, in this country and overseas, and looked forward to bringing the best of those into its portfolio, starting in the current financial year.
A fully imputed dividend of 5 cents per shares was to be paid, on top of 5cps paid in April, NZOG said.
Also important to NZOG's near and medium-term future was the progress made on the Kupe gas project, which at year end was 80 per cent complete.
Preliminary analysis of three development wells off the Taranaki coast confirmed that the wells and the reservoir had met expectations, NZOG said.
The Kupe project, in which NZOG has a 15 per cent interest, is due to commence commercial production in mid 2009.
In July 2007, NZOG also sponsored the public float of Pike River Coal, which is developing a West Coast coal mine, as a separate company listed on the NZX and ASX. NZOG retains a stake of just over 30 per cent in Pike.
NZOG shares closed at $1.62 yesterday, having ranged between $1.91 and 97c in the past year.

- NZPA

[cazzer]

Given Net profit before tax (after royalties) was $138m, was a bit surprised to then see a tax expense of $41m (about a 30% effective tax rate). I thought the company had lots of unbooked tax losses which should have substantially reduced the tax expense.

I think the answer is in the IFRS transition where the benefit of those tax losses which arose in prior years has been booked directly through retained earnings rather than to the P&L account. Can someone confirm my thinking is right and the tax losses did not evaporate.

[Hoop]

Chalice quote.
"...Looks like a few disgruntaled SP performance holders are taking the opportunity to bail - will be interesting to see what the close is."

I'm not sure that they are disgruntled Chalice...there was an opportunity to buy in last week and make a fast buck using buy on rumour sell on fact strategy.
I looked at that strategy myself last week and tried a balancing exercise of a possible oil $/barrel not rising verses increased NZO price due to temporary pre-report momentum increase. The oil market in a short-medium downtrending phase put me off so didn't act on that strategy... end result I didn't buy any..unfortunately:( as it happened, oil price did rebound up a little this previous week (until today).

[777]

Given Net profit before tax (after royalties) was $138m, was a bit surprised to then see a tax expense of $41m (about a 30% effective tax rate). I thought the company had lots of unbooked tax losses which should have substantially reduced the tax expense.

I think the answer is in the IFRS transition where the benefit of those tax losses which arose in prior years has been booked directly through retained earnings rather than to the P&L account. Can someone confirm my thinking is right and the tax losses did not evaporate.


They paid tax last year as well which would indicate that all available losses had been used up. Note 8 on the accounts covers it.

http://www.nzog.com/f111,57934/57934_NZOG_Financial_Statements_Audit_Opinion.pdf

[duncan macgregor]

Lets hope that some of you will pause and think about why after a great announcement has been made, that the sp has dropped slightly in a rising market. There is no fundamental reason for this, it goes against every FA indicator that there is. It only proves the point, that the traders control the price making market sentiment the ruling factor, with PE factors a distant second.
I would have expected that after announcing another dividend, that the mums and dads might have been enticed to buy a few. I still expect the sp to get up to the 180c mark before the market crashes when oil gets up to the $200 a barrel mark so keep those following stop losses up its all going to hit the fan. Macdunk

[Dr_Who]

The market seem to have already expecting a good result, so no surprises there. Oil have come down over night in the US, hence the sp weakness.

[Chalice]

The market seem to have already expecting a good result, so no surprises there. Oil have come down over night in the US, hence the sp weakness.

I think the reason for the drop is the result, while fantastic, didn't meet or exceed Expectations (100mill+) - otherwise a 5 cent dividend payable in circa 1 month whould have countered any oil price drop/SP sentiment.

Hopp - although there will be traders taking a profit from the 140s there are undoubtely many (and not necessarily traders) who purchased at 1.60-190, beleiving in Fundamentals, and having seen 1.42 have decided its cut and run time - why else would they forgo the divvy if not Disgrunteled with the underperforming shareprice?

Those who had to due to leveraging issues would have done so in the 140's.

I'm with McD on his post above.

[Snapper]

Snapper, here is Oil $NX vs $US plus the exchange rate plus NZO. NZO shareprice is more closely linked with the Oil price in $NZ.
Isn't this exactly what you would expect?

http://h1.ripway.com/Phaedrus/NZoilUS.gif


Check out Phaedrus's chart again - over 2008 NZO has very closely correlated with the price of oil and today is nothing new, oil goes down overnight and NZO drops a couple of cents on open. MD, if oil goes to $200, where do you think all the Kiwisaver money (and all the other Super funds) is going to go? it's got to go somewhere and I don't think it'll be property.

[Nitaa]

Lets hope that some of you will pause and think about why after a great announcement has been made, that the sp has dropped slightly in a rising market. There is no fundamental reason for this, it goes against every FA indicator that there is. It only proves the point, that the traders control the price making market sentiment the ruling factor, with PE factors a distant second.
I would have expected that after announcing another dividend, that the mums and dads might have been enticed to buy a few. I still expect the sp to get up to the 180c mark before the market crashes when oil gets up to the $200 a barrel mark so keep those following stop losses up its all going to hit the fan. MacdunkMD. I agree it was a great result and announcement. However this was in line with expectation. No surprises in this area. On top of that oil dropped a little bit overnight hence perhaps slight drop. Any variation in sp today or the next few days will come in the form of 2 things. 1 some will seee this result as a chance to exit. 2 others not up to take may see it as a stock to buy. As Bermuda and i both pointed out on Monday, we saw it as an opportunity to buy now sell today for the traders. End result will be a 10 cps plus gain. Yes there qare some mums and dads buying today judging by some of the very small trades

fundamentally this is still a great stock is a general bad market.

This might be a good opportunity for traders to pause for a moment and think about the longer term fundamentals as an opportunity to invest if they have the money. .

Your comment about the sp going to 180 cps then the market crashes is extremely baseless at the moment. I would say the chinesre markets have already crashed. if the chinese stock market crashes the same amount as what has this year then there will be no market in china. It is impossible for them to lose any more than what they already have. eg. if 53% drop this year represents $100 trillion then it is impossible for the sharemarket to tank more than that amount. do you agree?

[duncan macgregor]

NITA, The chinese market only dropped back to a realistic level which happens in any market that gets over hyped with unrealistic expectations. Its a bit like NZO being 97c to over 190c then back to 160c being under valued then over valued then back to reality.
Its what happens when the DOW crashes, aided by China manipulating the resource sector.China takes over number one spot without a shot being fired. America poses a great threat with its war mongering ways, what better method than pull the rug from under its economy. If you take a closer look at what companies china has been buying in to in the resource sector you will see the pattern emerge. Oil at $200 a barrel NITA you can bet your knickers on that in 2009. Macdunk
DISCL only joking about the knickers i know you are a bloke that wears underdungers.

[dsurf]

SP did rise - first trades 1.64 then fell when was obvious that the result would not bring enough buying momentum so traders out. Mum & dad don't know yet! It will be in the papers so lets see what they do monday. Hope Gustav strengthens.

NTA is interesting. $1.21 per share including PRC at "book value" $66m. At June 30 was trading at $2.35 & market value of shares (approx 85m) was $200m. Currently trading at $1.90 & stake worth $161m. So $161m - $66m =$95.5m unrecognised. With NZO having approx 400m shares / $95.5m = 24c per share.

So NTA is really $1.21 + 24c = $145 today.

This means that Kupe (80% complete) & PRC upside & any Tui future profits are worth 15c with the SP at $1.60

Gotta agree that markets are not rational

[Financially dependant]

SP did rise - first trades 1.64 then fell when was obvious that the result would not bring enough buying momentum so traders out. Mum & dad don't know yet! It will be in the papers so lets see what they do monday. Hope Gustav strengthens.

Gotta agree that markets are not rational

This is what I have been thinking, SP move up on Monday when mum and dad have read the papers and the oil price moves up over the weekend (there is a line up of Hurricanes east of Florida).

[777]

SP did rise - first trades 1.64 then fell when was obvious that the result would not bring enough buying momentum so traders out. Mum & dad don't know yet! It will be in the papers so lets see what they do monday. Hope Gustav strengthens.

NTA is interesting. $1.21 per share including PRC at "book value" $66m. At June 30 was trading at $2.35 & market value of shares (approx 85m) was $200m. Currently trading at $1.90 & stake worth $161m. So $161m - $66m =$95.5m unrecognised. With NZO having approx 400m shares / $95.5m = 24c per share.

So NTA is really $1.21 + 24c = $145 today.

This means that Kupe (80% complete) & PRC upside & any Tui future profits are worth 15c with the SP at $1.60

Gotta agree that markets are not rational


Also to add earnings from 30/6 to now. Approx another 6c and still increasing.

[fish]

SP did rise - first trades 1.64 then fell when was obvious that the Gotta agree that markets are not rational

Its this kind of irrationality that provides such good buying opportunities-nzo is a great buy at current prices . This dividend will mean that those who borrowed to buy into the rights issue no longer need to worry about interest payments or having to sell shares .
Will be good for the sp in the next few weeks . Suspect it will be in tomorrows papers and sp will climb on monday-unless it over-reacts to geopolitical events .

Anyway I will stop whinging about lack of divi and start celebrating success . will definately not be selling my nzo .

[Chalice]

[QUOTE=dsurf - Hope Gustav strengthens.


Getting desperate relying on destructive/life-threating weather to improve share price aren't you?

Those days maybe over anyway...

Oil producers have begun to halt drilling and operations in the Gulf of Mexico, anticipating that Tropical Storm Gustav could pick up speed as it feeds on warm waters over the next several days.

BP, ConocoPhillips, Shell and Transocean, a large drilling contractor, have begun evacuating hundreds of workers from rigs and production platforms in deep waters of the Gulf.
Conoco suspended drilling of some new wells in southern Louisiana and evacuated workers from its Magnolia field, whose daily production had previously been suspended for maintenance. Valero and other refiners have put their workers on alert to prepare for a possible direct hit on operations along the Texas and Louisiana coasts.

“We’re planning for a major hurricane in the Gulf, and we are taking appropriate steps,” a ConocoPhillips spokesman, Bill Tanner, said.
Chevron and Motiva Enterprises, which supplies Shell-branded gasoline across the Gulf Coast, took steps to ensure that terminals and gasoline stations had additional supplies to anticipate any increased demand in the event of an evacuation of New Orleans or another city. Most companies maintained production levels near normal, but there were signs that they were preparing to shut down a significant number of platforms over the next several days.
Shell announced that it was shutting down a few production wells Thursday morning and that it would complete an evacuation of all its 1,300 workers in Gulf waters by Saturday. Anadarko Petroleum announced that it was also beginning a total evacuation of 600 employees and contractors from drilling and production platforms around the Gulf to be completed by Sunday.

HERE'S TRHE INTERESTING PART:

The Energy Department said the government was prepared to release crude oil from the Strategic Petroleum Reserve in the event Gustav disrupted production, as it had after the 2005 hurricanes.
“D.O.E. is closely monitoring the situation and stands ready to use every available tool to ensure continuous and reliable supplies of energy,” the department said.

The region produces about a quarter of domestic oil production and almost 15 percent of natural gas production. Gustav could be the first storm to directly hit a large portion of the region’s energy infrastructure since 2005. That year the hurricanes Katrina and Rita crippled more than a hundred platforms, flooded several refineries and power stations and sent oil and gas prices soaring.

Over the last three years, producers and refiners have taken action to better secure their facilities from heavy storms. More anchor lines have been installed on platforms and rigs, and equipment has been raised higher out of the water. Many of the older platforms that were not properly reinforced for storm surges were paralyzed during the 2005 hurricane season and remain out of order. New platforms that have been built since then are considered more storm resistant.

The Gulf region is relatively less important for the country’s energy supplies than it was in 2005, because of a natural gas production boom onshore and because production in several Gulf fields is in decline. Consumption of oil is down this year by about 130,000 barrels a day, or 1.5 percent over the six months, according to the Energy Department

Final landfall could come anywhere from South Texas to the Florida panhandle.
Crude and natural gas prices had been edging up over the last several days, but prices plummeted on Thursday. Crude oil declined by $2.56, to $115.59 a barrel. Natural gas prices declined 55.8 cents, to $8.05 per million B.T.U.’s.
As the Labor Day weekend approached, gasoline prices had not been seriously affected by fears that the storm could disrupt supplies. The average national price for a gallon of unleaded regular gasoline on Thursday was $3.66, down 28 cents from a month ago.
Energy analysts said oil prices were easing -

because traders were relieved that the International Energy Agency, the policy adviser to 27 industrialized countries, announced that it would release strategic oil stocks if the storm caused major damage to Gulf facilities.

[Glendoonie]

And your point is ...?

[QOH]

I am happy to get another dividend. At least they are sharing some of the riches with their shareholders.

[dsurf]

From PPP - more drilling coming in effort to extend Tui

A comprehensive review and integration of the results of the Taranui1 and
Tieke1 exploration wells, together with the substantial volume of data
obtained from the four Tui Area horizontal development wells, has revealed a
number of opportunities for additional appraisal/exploration drilling near to
the existing Tui Area producing fields - with a total of five prospects
having been identified close to Tui, which are respectively named Tui SW,
Kahu Crest, Tui NE, Kahu Stratigraphic and Tui SE.

Any success in this area will enhance the use of existing Tui Area
facilities; including multi level tiein points and spare processing capacity
on the Umuroa FPSO. In the event of commercial discoveries, within these
prospects, there are the smaller accumulations which could each be produced
from one horizontal well, while Kahu Stratigraphic would require 3 wells.
PPP and its Tui Area partners are now considering the scale and timing,
subject to rig availability, of a possible future drilling campaign.

[foodee]

Anyway I will stop whinging about lack of divi and start celebrating success . will definately not be selling my nzo .


A nice bonus. The div will fund a couple of months R&R&fishing in the far north.
The good times are just beginning.

cheers

[cazzer]

They paid tax last year as well which would indicate that all available losses had been used up. Note 8 on the accounts covers it.

http://www.nzog.com/f111,57934/57934_NZOG_Financial_Statements_Audit_Opinion.pdf

Last year they had no income to speak of?? yet millions of tax losses- Tui has only generated income this year- I come back to my theory that the losses are booked through adjustments to opening retained earnings- where else is the benefit to be found?

[777]

Last year they had no income to speak of?? yet millions of tax losses- Tui has only generated income this year- I come back to my theory that the losses are booked through adjustments to opening retained earnings- where else is the benefit to be found?

Looking back through the past reports all available on news section of DB.

2004 7.8m surplus before tax etc.
2005 2.6m deficit
2006 2.3m surplus
2007 6.6m surplus.


These years included exploration write offs. Remember they booked a profit on PRC along the way.

I stand to be corrected but thats as I see it.

[cazzer]

Looking back through the past reports all available on news section of DB.

2004 7.8m surplus before tax etc.
2005 2.6m deficit
2006 2.3m surplus
2007 6.6m surplus.


These years included exploration write offs. Remember they booked a profit on PRC along the way.

I stand to be corrected but thats as I see it.

I think you see my point. The company had at least 60m tax losses in 2007 I believe. The above surpluses are minor and would not have used that level of tax losses. The company had huge tax shelter going into Tui production- where is that tax loss value reflected in their results?

[Lizard]

My simplistic reading is that the tax losses are effectively brought to book in the transition to IFRS, appearing on the balance sheet as a deferred tax asset - hence the increase in equity under IFRS.

Not sure where you got $60m from though - the deferred tax asset was about $27m at start of year and they utilised $23.5m in 2008.

[the machine]

And your point is ...?

a majorhurricane has not hit usa for over 2 years - gustov could be the breaker and moves under way to head off any effect of that

M

[sideline]

a majorhurricane has not hit usa for over 2 years - gustov could be the breaker and moves under way to head off any effect of that

M

Looking at the map how the hurricane could be right over the oil installations at market open
on Monday, it will be interesting to see the market overnight.
I can't imagine any oil traders wanting to be short over the weekend.
Thats a few shorts to close out in one session.

Article on Bloomberg about insurance companies watching in anticipation
http://www.bloomberg.com/apps/news?pid=20601072&sid=aD3kle4zWE5Y&refer=energy.

Also mentions that since insurance is now a lot more expensive than before Katrina, not so many
oil installations are insured adequately any more.

[Corporate]

Tui still seems to be producing at an amazing rate.

As at 30 July 1,000,000 BOE had been produced (33,333 BOPD)

As at 27 August 2,100,000 BOE had been produced (36,206 BOPD)

Production since 30 July - 1,100,000/28 days = 39,285 BOPD! if thats not outstanding I don't know what is!!!

[Corporate]

Forecasts were tellings us we'd be down to 15,000 BOPD.

[Chippie]

http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10529718

extract from the article

4:00AM Saturday August 30, 2008
By Grant Bradley
New Zealand Oil & Gas hopes to release details of new investment "shortly" after announcing a full year profit of $97.2 million on spectacular revenue from its Tui oilfields.

Chief executive David Salisbury said the company was looking to grow but not for the sake of it.

"We have some projects which we would expect would come to fruition shortly and others we had screened out for a number of reasons."

NZOG had not bid for any onshore Taranaki acreage but was looking for exploration opportunities offshore in the province and overseas - believed to be in Australia and south Asia.

"What we are looking forward to is the Government opening up some offshore acreage because we think we'd have a much greater appetite for that. We are looking offshore, we're not looking just at New Zealand," Salisbury said

[Snow Leopard]

There seems to be some confusion around the taxation of NZO and I thought that I should add to that :)
Firstly prior years results reported under GAAP can be very different from the IFRS equivalent and it is not safe to compare. (F'rinstance last year GAAP saw a tax expense of $400K, whilst the IFRS version has a $3,747K tax benefit :confused:).

But essentially the $41M dollars tax expense on page 1 is 'paid' by two separate
means. Firstly by using about $22M5 of tax benefit from previous full year losses and secondly by paying the remainder has real money to the IRD.

Going forward what tax benefits appear and for why I would not care to speculate but I am sure the accountants will be getting excited about them even now.

regards
Paper Tiger

[fish]

Katrina and Hurricane Rita, which followed it three weeks later, wrecked more than 100 Gulf oil platforms, but Gustav could deal a harsher blow.

"This storm will be more dangerous than Katrina," said Planalytics analyst Jim Roullier. "I think this storm will prove to be a worse case scenario for the production region."

Katrina was a Category 3 when its 28-foot (8.5 metre) storm surge burst the levees protecting New Orleans on August 29, 2005, flooding 80 percent of the city. New Orleans degenerated into chaos as stranded storm victims waited days for government rescue and $80 billion (44 billion pounds) in damages made Katrina the costliest U.S. natural disaster.

[fish]

Katrina and Hurricane Rita, which followed it three weeks later, wrecked more than 100 Gulf oil platforms, but Gustav could deal a harsher blow.

"This storm will be more dangerous than Katrina," said Planalytics analyst Jim Roullier. "I think this storm will prove to be a worse case scenario for the production region."

Katrina was a Category 3 when its 28-foot (8.5 metre) storm surge burst the levees protecting New Orleans on August 29, 2005, flooding 80 percent of the city. New Orleans degenerated into chaos as stranded storm victims waited days for government rescue and $80 billion (44 billion pounds) in damages made Katrina the costliest U.S. natural disaster.
NEW ORLEANS (Reuters) - Ferocious Hurricane Gustav moved into the oil-rich Gulf of Mexico on Saturday where it was expected to strengthen and threaten New Orleans after its 150 mile per hour (240 kph) winds cut a swath of destruction through western Cuba.

The Category 4 storm swept across Cuba in a matter of hours and now poses a threat to Gulf oil fields on a projected path that could take it ashore near New Orleans, still recovering from Hurricane Katrina in August 2005.

Forecasters said Gustav's winds had dropped to 140 mph (220 kph) crossing the island, but, like Katrina, it could swell into a catastrophic Category 5 storm, with winds above 155 mph (249 kph), as it surges across the Gulf's warm waters

[sideline]

This is getting interesting. From Bloomberg:

.......The New York Mercantile Exchange announced an extended trading session beginning at 2:30 p.m. today because of Gustav...............................
Most U.S. financial markets are closed until Sept. 2 for the Labor Day holiday. Nymex said in an Aug. 29 statement that electronic trading will begin at 2:30 p.m. New York time tomorrow with trades dated Sept. 2.

[Casa del Energia]

From PPP - more drilling coming in effort to extend Tui

A comprehensive review and integration of the results of the Taranui1 and
Tieke1 exploration wells, together with the substantial volume of data
obtained from the four Tui Area horizontal development wells, has revealed a
number of opportunities for additional appraisal/exploration drilling near to
the existing Tui Area producing fields - with a total of five prospects
having been identified close to Tui, which are respectively named Tui SW,
Kahu Crest, Tui NE, Kahu Stratigraphic and Tui SE.

Any success in this area will enhance the use of existing Tui Area
facilities; including multi level tiein points and spare processing capacity
on the Umuroa FPSO. In the event of commercial discoveries, within these
prospects, there are the smaller accumulations which could each be produced
from one horizontal well, while Kahu Stratigraphic would require 3 wells.
PPP and its Tui Area partners are now considering the scale and timing,
subject to rig availability, of a possible future drilling campaign.


This is very significant. First hint of what's in the wind.

[fish]

This is getting interesting. From Bloomberg:

.......The New York Mercantile Exchange announced an extended trading session beginning at 2:30 p.m. today because of Gustav...............................
Most U.S. financial markets are closed until Sept. 2 for the Labor Day holiday. Nymex said in an Aug. 29 statement that electronic trading will begin at 2:30 p.m. New York time tomorrow with trades dated Sept. 2.
New Orleans Orders Evacuation as Gustav Reaches Gulf (Update2)

By Jerry Hart and Brian K. Sullivan

Aug. 31 (Bloomberg) -- New Orleans ordered residents to evacuate as Hurricane Gustav swelled into a Category 4 storm that may strike the U.S. Gulf Coast harder than Katrina did three years ago.

``Tonight you need to be scared; you need to get your butts out of New Orleans now,'' Mayor Ray Nagin said at a press conference late yesterday. ``This is the mother of all storms. I am not sure we have seen anything like it.''

[Mr Tommy]

http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10529718
New Zealand Oil & Gas hopes to release details of new investment "shortly" after announcing a full year profit of $97.2 million on spectacular revenue from its Tui oilfields.

Chief executive David Salisbury said the company was looking to grow but not for the sake of it.

"We have some projects which we would expect would come to fruition shortly and others we had screened out for a number of reasons."


Something Ive been thinking about for a while, is it now an appropriate time to consider a company name change ?

New Zealand Oil and Gas is a bit of a mouthful, and a bit stale in my opinion after 25 years. I still refer to it as NOG, the old ticker symbol, which is easier to say.

Look at our top companies, their names are a brand - Telecom, Infratil, Fletchers, Nuplex, Rymans
Our energy companies have names like Genesis, Contact, Vector, Meridian

NZOG is listed in NZ and Oz, so its not really solely a NZ owned company anyway, and if we are to start investing offshore then the NZ is even less appropriate. In fact it may even discourage some of our aussie friends from investing in the company.

I worked at the New Zealand Dairy Board for many years. They merged with the main dairy companies to form Fonterra, and are now one of the top 5 dairy companies in the world. Im sure the name change helped, and they now have a worldwide brandname.

NZOG in the last few years has moved into the NZX 50, and could soon be in the top 15. This company should be a household name - something like Caltex, Shell, Mobil ....

What do you others think ?

[777]

Change for changes sake. Personally I think Fonterra should still be the NZDB. This country appears to want to give up what little tradition we have.

Any way it is only going to be called NZOG until it is taken over. And it will be because it will always be under valued by the NZ sharemarket.

[macduffy]

I don't see a name change being beneficial for NZOG. Names like Roc, Tap, Beach, Anzon etc in Australia don't seem to do much for their SP. It's also not a case or appealing to the consumer via a retail presence in the way that Fonterra, Caltex, Shell etc need to. Results with the drill with drive NZO, one way or the other.

;)

[Toddy]

NOG is a fantastic brand name.

NZOG is a mouth full.

NZO, not too sure why the NZX changed the symbol.


Ever filled up your car with NOG before. Has the wife ever gone shopping with NOGs (dividends).

[boxburger]

I believe 'New Zealand' is blossoming as a brand. The cringe factor has no home here any more.

Those words conjure up the right images for an oil company, right round the world. People know the words from the label inside their softest woollen garment. From the sticker on expensive but superb Kiwifruit at their supermarket. Thanks to The Conchords the world are even embracing our idiosyncrasies.

The Nigerian Oil Company? Nope, all wrong. It conjures up thoughts of insurgents and sabotage. The Iranian Pile-line Company? I'd be investing with very tight stop losses!

I think 'New Zealand Oil' conjures up thoughts of a clean company operating in a mucky business with a quality product out of a stable nation. Great attributes moving forward in the resource business.

As someone pointed out earlier, I too believe that Fonterra would now be better served by their retired brand name.

I'm proud to be a New Zealander and I like the fact that NZO&G wear our badge with pride.

[Lion]

NZO, not too sure why the NZX changed the symbol.


I think the reason was when the D options were started, their code would have been NOGOD with the old NOG code. It might have upset some people.

This is just my assumption - don't think it was ever officially stated.

Although they stuck with the A options - NOGOA sounds like no goer
and the B options - no gob

[zigzag]

A more realistic name would be " New Zealand Oil and Gas and Coal ".

[777]

Good summary of updated valuation of NZO from their website.

http://www.nzog.com/analystcoverage

[fish]

Have just taken this from the nzog website-
Production Performance

Production began on 30 July 2007. Total production in FY08 (year ended 30 June 2008) was 14.2 million barrels. NZOG's share of production was approximately 1.78 million barrels

Oil Production since 1 July 2008:

1 July-31 August: Approx 2.25 million barrels. NZOG's share of production approx 280,000 barrels.

Tapis Benchmark Crude - the weekly average Tapis price per barrel

Week ended
Average Tapis Price
NZ$ Equivalent

22/08/08
US$121.18
NZ$170.99

15/08/08
US$123.38
NZ$174.54

08/08/08
US$129.89
NZ$184.24

01/08/08
US$135.03
NZ$183.71

25/07/08
US$139.87
NZ$186.49

18/07/08
US$151.97
NZ$198.39

11/07/08
US$148.64
NZ$195.83

04/07/08
US$148.60
NZ$195.53


nz dollar has weakened,oil price should be strong with about 20% us oil production shut down , 5 cent fully imputated dividend-hopefully we shall see this reflected in a rising sp

[beacon]

Very interesting and novel 777. Thanks for pointing it out. Very investor friendly exercise to put these analyst reseraches on their website. Must be the only company that has done this...

[Xerof]

The Analysts Research Section has been on their site (old as well as new) for as long as I can remember..........

which these days is probably running at about 6 months :rolleyes::rolleyes::rolleyes:

PRC has extensive coverage posted on their site as well.

[Chalice]

The Analysts Research Section has been on their site (old as well as new) for as long as I can remember..........

which these days is probably running at about 6 months :rolleyes::rolleyes::rolleyes:

PRC has extensive coverage posted on their site as well.

Not that the research bears much sembelence to reality - oil down just under 4%, NZO down just over 3% so far...

Maybe NZO should have declared a loss, project delays and no dividend like PRC which is back up to $2?

[Bilo]

Not that the research bears much sembelence to reality - oil down just under 4%, NZO down just over 3% so far...

Maybe NZO should have declared a loss, project delays and no dividend like PRC which is back up to $2?

Some Oil priced for October delivery to the USA may be down by 4pc in USD.
NB
· not oil based on the Tapis standard
· Not in NZD
· Not that that price is anywhere near the price that is factored into broker valuations
Instead of making a 90pc contribution to profit from revenue NZO is only getting 80pc. Most companies are delighted with 5 to 10pc of sales.
Lets face it – indexing oiler share prices to the WTI index is another excuse for those in the know (big investors hedge funds and brokers) to manipulate the share price for trading gains. The ASX does it - all the major bourses in the world provide mechanisms to do it, it must be right.

A 4pc reduction in the price of oil for October might reduce NZO’s profit by $40,000.
The 4pc reduction in share price shaves $24,000,000 off NZO’s market capitalisation.
What is wrong with manipulating company share capitalisation to indicies? Nothing at all. Yeah right.

[peterfindlay]

Markets are not always "right'. In NZOG's case its SP is overly sensitive to just one component, the oil price, and does fairly reflect the mix of ingredients that are driving both the business and the value forward and higher.

The valuations referred to in the NZOG website, and in earlier posts, put a much higher value on Pike, Kupe, Tui, Cash, and other components, than the market does. My view is that the broker valuations referred to will continue to be revised upwards, and than in time, the valuations will eventually be shown to be much closer to the mark than the value implied by the market of today. An example of the the value gap is evidenced by recent valuations of Pike River compared to the SP.

ABN Amro research on Pike River was updated on 29 August 2008 and shows a target price of $3.87 (c.f. SP of $1.89 on 29 Aug 08).

The updated valuation includes significant revisions to forecast HCC prices (upwards), NZ$/US$ exchange rates (downwards), mining costs (upwards), operational capex (upwards).

HCC prices are forecast in US$/t as follows:

2009F 300, 2010F 318, 2011F 305, 2012F 225, 2013F 150, 2014F 108, 2015F 88.

The AMN Amro research lists the catalysts that could rerate Pike and are shown as:

Commencment of production,
An increase in reserves and expected extraction from the Brunner seam, and the development of the Paparoa seam,
Continuation of the current high HCC spot prices and contract prices in early 2009,
A selldown or divestment of NZO's 30.5% stake in PRC,
Sector M & A activity with PRC as a target,

The eventual market rerating of Pike is just one of the ingredients in NZOG's value mix that will ultimately flow through to NZOG's valuation and share price. It does appear that in Pike River's case, the rerating is just starting to occur, having recently dropped to the low 170's and now having just broken the $2 mark again.

[Chalice]

Some Oil priced for October delivery to the USA may be down by 4pc in USD.
NB
· not oil based on the Tapis standard
· Not in NZD
· Not that that price is anywhere near the price that is factored into broker valuations
Instead of making a 90pc contribution to profit from revenue NZO is only getting 80pc. Most companies are delighted with 5 to 10pc of sales.
Lets face it – indexing oiler share prices to the WTI index is another excuse for those in the know (big investors hedge funds and brokers) to manipulate the share price for trading gains. The ASX does it - all the major bourses in the world provide mechanisms to do it, it must be right.

A 4pc reduction in the price of oil for October might reduce NZO’s profit by $40,000.
The 4pc reduction in share price shaves $24,000,000 off NZO’s market capitalisation.
What is wrong with manipulating company share capitalisation to indicies? Nothing at all. Yeah right.

I quite agree with you, as Phadreus's charts have shown, very strong corelation b/t nzo sp & op - my statement was facicious rather than agreement with how it seems to be working, although a 4% decrease in oil price works out to be closer to a 800K reduction in revenue for October -not significant to cashflow or cap decrease though.

[Toddy]

The oil price is in a free fall. Its all good for the world economy. Not so good for NZO.

Sept. 2 (Bloomberg) -- Crude oil fell to a five-month low below $106 as oil companies prepared to resume production from rigs closed by Hurricane Gustav.

[Bilo]

The oil price is in a free fall. Its all good for the world economy. Not so good for NZO.

Sept. 2 (Bloomberg) -- Crude oil fell to a five-month low below $106 as oil companies prepared to resume production from rigs closed by Hurricane Gustav.

NZO is fine. The NZO share price will likely provide a buying opportunity...

[Casa del Energia]

Some angst out there about falling oil, the sp apparently pegged to Brent or whatever. No problemo - drilling rigs will be easier to get and pay for, aquisitions will be cheaper - or at least not sky high in price - perfect for NZO in the mid term considering there is a giant war chest to play with.
I'm holding - the next couple of months may see some people saying 'Oops - shouldn't have sold down'.

[Rabbi]

I'm an early starter and I am just looking at Bloomberg. At the moment WtI Crude down $7 at $1.08. So I'm thinking; will the NZO SP get walloped today or will rationality prevail?

Probably the former :so there could be some good buying opportunities coming up before the price of crude bottoms.:cool:

[Chalice]

I'm an early starter and I am just looking at Bloomberg. At the moment WtI Crude down $7 at $1.08. So I'm thinking; will the NZO SP get walloped today or will rationality prevail?

Probably the former :so there could be some good buying opportunities coming up before the price of crude bottoms.:cool:

WTI was actually only down $1.43/1.3% to just under $110 overnight (circa $NZ 175 @0.687 which is better than recent - see NZOG website) as the it was delayed/playing catchup with NYMEX/Brent due to closures for labor day - don't look at Bloomberg for accurate changes until tomorrow.

Interesting that on the ASX NZO was only down 1.5cents yesterday and there doesn't seem to be any great lineup/desire to sell - ask 3 cents above close.

Maybe as the Aussies are used to trading resourse stocks they are a bit more focused on the famous fundamentals?

[Dr_Who]

Maybe as the Aussies are used to trading resourse stocks they are a bit more focused on the famous fundamentals?

LOL.. dont think so.

[Drone]

What a bizzare sell-down this morning.

Say you ascribe $1.30 per share to the value of the cash and pike stake.

That means the value of tui/kupe/exploration rights was about 25c yesterday according to the market. So the market has reduced the value of the future cashflows of the firms projects by 20% this morning....(with the 5c sell down).

[beacon]

Thanks Xerof and 777. positions opened in NZO.

[Chalice]

What a bizzare sell-down this morning.

Say you ascribe $1.30 per share to the value of the cash and pike stake.

That means the value of tui/kupe/exploration rights was about 25c yesterday according to the market. So the market has reduced the value of the future cashflows of the firms projects by 20% this morning....(with the 5c sell down).

If you include the 5 cent dividend with a record date in 12 trading days it's unreal, although very small parcels being traded.

What would you need to offer for a takeover - $1.75? You could fund almost 50% (well 50% by EOFY even at $2) with the company's cash!
You'd just about have the Tui & Kupe for nix by selling out of PRC at 2.50 late next year!

[sideline]

.........
What would you need to offer for a takeover - $1.75? .................
I don' t think anything below $3 would succeed.

The volumes traded this morning are very small - a few shortsighted traders.
Yesterday intraday the oil price was actually lower than what it is now, so
I don't see any logic in the move of NZO sp.

[Chalice]

I don' t think anything below $3 would succeed.

The volumes traded this morning are very small - a few shortsighted traders.
Yesterday intraday the oil price was actually lower than what it is now, so
I don't see any logic in the move of NZO sp.

hands up for those who would take below $3...
BTW - traders today will be creaming it!

[tricha]

I'm an early starter and I am just looking at Bloomberg. At the moment WtI Crude down $7 at $1.08. So I'm thinking; will the NZO SP get walloped today or will rationality prevail?

Probably the former :so there could be some good buying opportunities coming up before the price of crude bottoms.:cool:

Rationality Failed :(

At the moment, people do not seem to see the trees from the wood, oil is still around $130 OZ, NZ dollar similar proportionally, so how the price at the pump is to come down is beyond me.

NZO still creaming it :p



Brent Crude Oil $US/barrel


http://nz.f961.mail.yahoo.com/ya/download/nz/ShowLetter?box=Inbox&MsgId=8449_8749736_19515_1829_319275_0_20659_51113 0_1334348848&bodyPart=6&YY=24066&y5beta=yes&y5beta=yes&order=down&sort=date&pos=0&view=a&head=b&Idx=4



A$/US$


http://nz.f961.mail.yahoo.com/ya/download/nz/ShowLetter?box=Inbox&MsgId=8449_8749736_19515_1829_319275_0_20659_51113 0_1334348848&bodyPart=7&YY=24066&y5beta=yes&y5beta=yes&order=down&sort=date&pos=0&view=a&head=b&Idx=4



Disclosure, only hold OZ listed shares and NZO is one of them.

[the machine]

todays paper shows nzo p/e ratio of 3 - wow!

the new prospects around tui look good and awe are talking about possible drilling next year

exciting times ahead, with next driver being prc hitting the coal in a few weeks time

M

[bermuda]

todays paper shows nzo p/e ratio of 3 - wow!

the new prospects around tui look good and awe are talking about possible drilling next year

exciting times ahead, with next driver being prc hitting the coal in a few weeks time

M


I know, yet a lot of people are getting confused between the price of oil and a really prosperous company.

[sideline]

Found this on PNN, unfortunately I don't have access to the full story. Could somebody with
access please fill us in on the finer details of the story? - TIA

Multi-well exploration program for NZ in 09: AWE
Neil Ritchie, New Zealand
Tuesday, 2 September 2008

TUI operator Australian Worldwide Exploration is planning a $A300 million, multi-well exploration, appraisal and development drilling program off Taranaki, New Zealand next year.

[Rabbi]

Oil price still drifting- so will NZO continue to drift with it or rally on fundamentals?:confused:
Crude prices (-1.4% at $108.23) have declined for the fourth straight day, marking a 36% retreat from the Jully 11 all-time high. Commodities as a whole are down 1.3%.
As a result, the energy (-1.2%) and materials (-1.6%) sectors are on the defensive. Coal and consumable fuels is the weakest group, falling 7.3% after slipping 10.4% in the previous session.:eek:


This was at midday Eastern Time so I am assuming the trend will continue..

[Corporate]

Nice article on pike this morning


Coal price stokes Pike outlook
By JAMES WEIR - The Dominion Post | Thursday, 04 September 2008

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AdvertisementPike River Coal is expecting good prices of more than US$300 a tonne for its export coal, with India desperate for coal and China becoming a net importer for the first time this year.


Some brokers are forecasting a near doubling in Pike's share price in the coming year on the back of high world coal prices, even though the mine is still a month away from actually hitting its West Coast coalseam.

Pike River is in the "last dash" 120 metres of a 2.3km tunnel to its coalseam, with production expected to ramp up to one million tonnes a year from June.

The tunnel should be complete at the end of this month, Pike River chief executive Gordon Ward said.

Pike River's coalmine is about 100m below the surface in the remote Paparoa Range, about 50km northeast of Greymouth.

"It is tiger country," Mr Ward said.

The international price of coal is about three times the conservative level forecast in Pike's prospectus last year, which predicted prices would drift off to the mid US$70 range over time. Instead, world coal prices have boomed, with broker reports suggesting prices above US$300 (NZ$444) a tonne next year, up from US$150 in the past year.

On that basis, broker ABN Amro has just given Pike a 12-month target of $3.87 a share, Mr Ward told the Australasian Institute of Mining and Metallurgy mining conference in Wellington this week. "Potentially a healthy increase," he said.

Pike River shares have risen from $1 at the share float last year to $1.95 this week, the best performance of the NZX top 50.

World coal prices rocketed after Australian production in Queensland was affected by flooding and power stations in South Africa could not get enough coal.

But the long-run key is rapidly growing demand from China and India.

India, where most of Pike River's coal is destined, is hungry for coal and is expected to need an extra 15 million tonnes a year during the next five years.

China used to export coal, but for the first time this year is a net importer of both thermal and hard coking coal.

China has also just increased the "export tax" on thermal coal from 5 per cent to 10 per cent, matching the 10 per cent tax on coking coal, adding tension to supply and demand, Mr Ward said.

Pike expected "good [coal] prices for a number of years".

Contract prices are adjusted during annual price negotiations, taking the lead from BHP price agreements.

ABN Amro and Citigroup are now forecasting coal prices next year of more than US$300 a tonne, with spot prices as much as US$370 a tonne.

"The consensus from about six brokers is much higher prices forecast for much longer. Citigroup [alone] sees coal at US$250 a tonne in five years' time," Mr Ward said.

Bullish brokers said the fall in the Kiwi dollar from US80c to US70c was also a positive in New Zealand dollar income.

About a third of the Pike River mine's operating costs are for power, but Pike has locked in fixed price hedge contracts for about 18 months. Wholesale or spot market power prices skyrocketed this winter and Mr Ward admitted the company would be exposed to rising prices in future.

There was some potential for Pike to produce its own power from coalseam gas at the mine, which could reduce the overall power bill.

Export coal is exempt from the Government's emissions trading scheme

[777]

Let's just hope that NZO will hold off selling down their shareholding until after the share price has doubled.

[shasta]

Let's just hope that NZO will hold off selling down their shareholding until after the share price has doubled.

Relevant article re NZO...

Litigious NZ a 'turnoff' for oil explorers

Oil and gas companies are too quick to start legal battles and that is a turnoff for international explorers who see New Zealand as "irrelevant".


New Zealand Oil and Gas chief executive David Salisbury said the government moratorium on new base load gas-fired power stations for a decade was also a significant deterrent to exploration.

"That ripples back to the other side of the world and puts people off investing," he said yesterday.

There were excellent prospects for exploration, but the Government needed to hurry up and open more acreage. "We would like to see the Ministry of Economic Development move more quickly with acreage releases, rather than being complacent. There is an opportunity to get after it now."

New Zealand was not on the radar of most big players, Mr Salisbury said, despite international giant Exxon Mobil exploring in the Great South Basin off the coast of the South Island.

"It is a real challenge to get companies to come down here, especially to drill a series of wells which could cost about US$40 million (NZ$58 million) each."

NZOG is looking for new investments in New Zealand but is also actively looking overseas.

Mr Salisbury also took aim at New Zealand's "highly litigious reputation".
It had a small industry with the same people involved in similar issues, so lawyers were brought in as a circuit breaker for sorting out long-term contracts.

Mr Salisbury said legal action seemed to go on "all the time", often with the goliaths facing action from small firms.

Internationally, firms looked for other solutions and to cooperate, rather than to try to win against other firms.

New Zealand Oil & Gas recently reported a $97 million profit for the year after the success of the offshore Taranaki Tui oil field. Tui showed exploration and production could be highly profitable for a New Zealand company. Typically, small exploration companies had success with one in five exploration wells.

But just to bring in a rig would cost US$20 million to US$50 million, with another US$20 million to US$30 million at least to drill a single well. If a few wells were being drilled, the average cost might be about US$40 million a well.

The worldwide exploration sector was "very hot" with oil prices at about US$110 a barrel. They peaking at almost US$150 a barrel recently, compared with US$70 a year ago.

World demand for oil was expected to rise more than 40 per cent by 2030, Mr Salisbury said. That would mean investing more than US$4.3 trillion by 2030.

New Zealand was largely an overlooked option in a risk game. Its production wass just 0.2 per cent of world supply; it had a small market, a shortage of skilled people and a limited infrastructure, with nothing outside Taranaki.

[Casa del Energia]

Found this on PNN, unfortunately I don't have access to the full story. Could somebody with
access please fill us in on the finer details of the story? - TIA

Multi-well exploration program for NZ in 09: AWE
Neil Ritchie, New Zealand
Tuesday, 2 September 2008

TUI operator Australian Worldwide Exploration is planning a $A300 million, multi-well exploration, appraisal and development drilling program off Taranaki, New Zealand next year.

I'd like to see it too. This is the second 'hint' that there is something afoot. This is far more significant than the fretting over the sp or what West Texas is doing. It points to the future..

[Chalice]

I'd like to see it too. This is the second 'hint' that there is something afoot. This is far more significant than the fretting over the sp or what West Texas is doing. It points to the future..

Very exciting!

This should probably be on the LMP thread but it maybe a hint of announcements from NZO soon to come... less a 0 or two.

L&M PETROLEUM TO PARTICIPATE IN CALIFORNIA EXPLORATION PROGRAM
Highlights
- L&M Petroleum aims to join Salinas Energy in drilling program
targeting light oil prospects in the prolific San Joaquin Basin of
California.
- 18 million barrel recoverable potential Osso Bucco Prospect will be
drilled first.
- Rig secured for November drilling.

$NZ seems to be in a steady decline at the moment, would be really interesting to know how much, if any at all, of the cash lake NZO is holding is in USD - with a view to overseas investment.

[Xerof]

Casa et al

If you look at AWE's presentation dated AUG 22, page 15, they have a chart which indicates their plans for drilling the Naki Basin in 1st Half 2009

Many Tui well names on the list, but you're right, there's not a lot of other detail given.

Anyway, it's there in black and white

Having said that, not sure if NZO actually has a slice of it, but will look it up

Yep, it's all part of the same permit PMP 38158 see page 19 of the same presentation

[777]

Very exciting!

This should probably be on the LMP thread but it maybe a hint of announcements from NZO soon to come... less a 0 or two.

L&M PETROLEUM TO PARTICIPATE IN CALIFORNIA EXPLORATION PROGRAM
Highlights
- L&M Petroleum aims to join Salinas Energy in drilling program
targeting light oil prospects in the prolific San Joaquin Basin of
California.
- 18 million barrel recoverable potential Osso Bucco Prospect will be
drilled first.
- Rig secured for November drilling.

$NZ seems to be in a steady decline at the moment, would be really interesting to know how much, if any at all, of the cash lake NZO is holding is in USD - with a view to overseas investment.

Chalice if you read the annual accounts under Note 10 NZOG have stated that they have deposits dominated in US$ of 49,000,000 (NZ$64,000,000 equivalent)

[Lion]

I still reckon the best investment for all this NZO cash is NZO itself.

Start the buyback! There's never been a better time.

[Xerof]

Permit PMP38158 (Tui)

(NZOG Interest 12.5%)
This permit includes the producing Tui Area Oil Fields.
3D marine seismic is being remapped to incorporate the results from the 2006-2007 Tui drilling campaign. The remapping of the entire permit is expected to better define leads.


Drill-mature prospects could be targeted in a potential 2009 drilling campaign. Any future discoveries could be tied-back directly to the FPSO vessel Umuroa, which is processing oil from the Tui fields.


I guess all we can say they are talking about it and doing the planning

[Casa del Energia]

Permit PMP38158 (Tui)

(NZOG Interest 12.5%)
This permit includes the producing Tui Area Oil Fields.
3D marine seismic is being remapped to incorporate the results from the 2006-2007 Tui drilling campaign. The remapping of the entire permit is expected to better define leads.


I guess all we can say they are talking about it and doing the planning

Cheers. I wait with baited breath. I also saw the comment from Mr Salisbury in this mornings business news in the Dom Post about the wish for NZ Govt to open up more permit acreage asap - more indication of a sincere wish to drill more offshore Taranaki.

[Chalice]

Chalice if you read the annual accounts under Note 10 NZOG have stated that they have deposits dominated in US$ of 49,000,000 (NZ$64,000,000 equivalent)

thanks for the info 777 - nice gain of around 7 million due to the drop of $NZ since then!

[the machine]

crown minerals website has fast tracked news from awe re possible 2009 drilling

M

[tricha]

Chalice if you read the annual accounts under Note 10 NZOG have stated that they have deposits dominated in US$ of 49,000,000 (NZ$64,000,000 equivalent)

I hope it's not in Fannie Mae and Freddie Mac :rolleyes:

[Casa del Energia]

crown minerals website has fast tracked news from awe re possible 2009 drilling

M


Found it.
http://www.crownminerals.govt.nz/cms/news/2008/awe-plans-major-development-of-wider-tui-field
Because the gas link is mentioned, then NZO is involved in at least that - but what about the new drilling? Chris Roberts - clarifiaction?

[upside_umop]

Given the drilling is contained in the Tui permit, NZOG will be entitled to its share of 12.5% of costs and rewards.
Not so sure with Hoki.

[Casa del Energia]

Given the drilling is contained in the Tui permit, NZOG will be entitled to its share of 12.5% of costs and rewards.
Not so sure with Hoki.

Malvern PEP 38524 and Hoki PEP 38401 don't appear to be on NOGs web site. So I'm not sure either. (Tui is PEP 38158).

[Chalice]

Given the drilling is contained in the Tui permit, NZOG will be entitled to its share of 12.5% of costs and rewards.
Not so sure with Hoki.

Atleast NZO are making a song and dance about it, probably helps explain the sterling SP performance.

BTW - $NZ at 0.6650!

[Nitaa]

Atleast NZO are making a song and dance about it, probably helps explain the sterling SP performance.
You make a very good point. quite a timely reminder about litigation concerns by DS as well. AWE is the daddy and also scalped Eric mathews which was a steal. I like the fact that ds is using its position to put presure on the government to release more acerage.

IMO, NZO cannot beat them (or at least be very difficult) so as the saying goes "if you cant beat them then join them. AWE represents very good buying and of course are exposed to oil volatiity with such a big stake in tui. nzo should seriously consider buying a decent stake in awe to the point of getting a team member on the board. It is time for nzo to protect their interest and not get rolled over by the big bullies.

get ppp and nzo each to accumulate and buy a stake in awe. ppp and nzo to merger and evenutally mount a takeover. why not?

[Chalice]

You make a very good point. quite a timely reminder about litigation concerns by DS as well. AWE is the daddy and also scalped Eric mathews which was a steal. I like the fact that ds is using its position to put presure on the government to release more acerage.

IMO, NZO cannot beat them (or at least be very difficult) so as the saying goes "if you cant beat them then join them. AWE represents very good buying and of course are exposed to oil volatiity with such a big stake in tui. nzo should seriously consider buying a decent stake in awe to the point of getting a team member on the board. It is time for nzo to protect their interest and not get rolled over by the big bullies.

get ppp and nzo each to accumulate and buy a stake in awe. ppp and nzo to merger and evenutally mount a takeover. why not?

What really bemuses me is that AWE can "announce in a presentation to investors that it plans to accelerate the next phase of drilling in its Taranaki permits in a 6 to 8 well campaign over nine months starting in early 2009." - and include cost estimates - yet DS & CR don't in their 2nd/4th September presentations. WTF?

They are being very active in their attempts to bolster SP and the market doesn't seem to be acting rationally, so maybe time for a new approach?

Given the current freefall of the $NZ and the markets predilection to peg NZO SP to the WTI it would be great to have a banner on the NZO website, as per NZX/ASX SP indicating oil price/return in $NZ.

I know its done on a week by week basis in the Tui Area Oil Fields section but anything to break what can only be seen as a detrimental marriage of SP to WTI can only be beneficial - afterall $NZ returns have actually increased over the past day or two on falling oil proces yet SP hit $1.50 this morning!

[bermuda]

What really bemuses me is that AWE can "announce in a presentation to investors that it plans to accelerate the next phase of drilling in its Taranaki permits in a 6 to 8 well campaign over nine months starting in early 2009." - and include cost estimates - yet DS & CR don't in their 2nd/4th September presentations. WTF?

They are being very active in their attempts to bolster SP and the market doesn't seem to be acting rationally, so maybe time for a new approach?

Given the current freefall of the $NZ and the markets predilection to peg NZO SP to the WTI it would be great to have a banner on the NZO website, as per NZX/ASX SP indicating oil price/return in $NZ.

I know its done on a week by week basis in the Tui Area Oil Fields section but anything to break what can only be seen as a detrimental marriage of SP to WTI can only be beneficial - afterall $NZ returns have actually increased over the past day or two on falling oil proces yet SP hit $1.50 this morning!

Hi Chalice,
I agree. It is a bit strange. If Chris is reading this he may like to comment. A 2009 drilling programme in and around Tui would be most welcome.

[macduffy]

You make a very good point. quite a timely reminder about litigation concerns by DS as well. AWE is the daddy and also scalped Eric mathews which was a steal. I like the fact that ds is using its position to put presure on the government to release more acerage.

IMO, NZO cannot beat them (or at least be very difficult) so as the saying goes "if you cant beat them then join them. AWE represents very good buying and of course are exposed to oil volatiity with such a big stake in tui. nzo should seriously consider buying a decent stake in awe to the point of getting a team member on the board. It is time for nzo to protect their interest and not get rolled over by the big bullies.

get ppp and nzo each to accumulate and buy a stake in awe. ppp and nzo to merger and evenutally mount a takeover. why not?


Takeover of AWE by NZO/PPP doesn't look likely, now or in the future.
Market cap of AWE is more than twice combined NZO/PPP - $1.479b against $613m. Wouldn't like to have to go looking to borrow best part of a billion dollars in this market, particularly not to take over another oiler, and can't see any attraction to AWE shareholders in a scrip offer from NZO/PPP.

;)

[Chris Roberts]

Found it.
http://www.crownminerals.govt.nz/cms/news/2008/awe-plans-major-development-of-wider-tui-field
Because the gas link is mentioned, then NZO is involved in at least that - but what about the new drilling? Chris Roberts - clarifiaction?

There are promising leads within the Tui permit and the joint venture has been discussing a possible drilling campaign for some time. NZOG has made references to this in our Quarterly Reports and elsewhere. The joint venture has made no formal decision to proceed. If and when a decision is taken, we will announce it immediately. AWE, as Tui Operator, chose to reveal details of its drilling campaign proposals in its annual results announcement. We prefer to wait until a rig is obtained and there is a commitment made by the joint venture to drill. The joint venture is addressing the matter with some urgency but there is no announcement to be made at this time.

[Casa del Energia]

There are promising leads within the Tui permit and the joint venture has been discussing a possible drilling campaign for some time. NZOG has made references to this in our Quarterly Reports and elsewhere. The joint venture has made no formal decision to proceed. If and when a decision is taken, we will announce it immediately. AWE, as Tui Operator, chose to reveal details of its drilling campaign proposals in its annual results announcement. We prefer to wait until a rig is obtained and there is a commitment made by the joint venture to drill. The joint venture is addressing the matter with some urgency but there is no announcement to be made at this time.

Thanks Chris - clear and concise answer. Much appreciated.

[Nitaa]

Takeover of AWE by NZO/PPP doesn't look likely, now or in the future.
Market cap of AWE is more than twice combined NZO/PPP - $1.479b against $613m. Wouldn't like to have to go looking to borrow best part of a billion dollars in this market, particularly not to take over another oiler, and can't see any attraction to AWE shareholders in a scrip offer from NZO/PPP.

;)I agree that it is not the norm. However i i do not think its impossible and in my mind yopu would probablyu have to pay well in excess of $AU2b possibly $AU3b to have any chance. If NZO believe that tui and permits close to tui are value for awe then they are in the best position to see if its worth having a stake in awe. Not a bad place to start parking some of their loot. PPP is another although its like a flip flop from over 12 months ago should they go ahead.

Employment contract wise i feel that any contracts that give employees access to sensitive information should include clauses that prevent top staff from being head hunted or scalped. I am referring to the risk of losing good staff like Eric Mathews.

There are good synergies to be gained.

Worth to note, although nzo is still creaming it, drilling costs are going off the scale at the moment and are possibly 400 or 500% above what they were about 4 years ago. With our depreciating dollar its going to have some impact down the line.

discl. holding as tight as a 2 year old to her teddy.

[Zaphod]

Employment contract wise i feel that any contracts that give employees access to sensitive information should include clauses that prevent top staff from being head hunted or scalped. I am referring to the risk of losing good staff like Eric Mathews.


It's a good idea however in practice, it is almost impossible to enforce.

[temptation]

"Top Staff" are rightly entitled to the same freedoms as the rest of us to go where the money is. Eric Mathews would not have been privy to information that other NZO staff were not also privy to, so the information that he knows is not lost to NZO. AWE are most likely paying for his abilities, not for any specific information. If Eric Mathews were to divulge information to which NZO owns the intellectual property, then there would be grounds for a court case.

[Zaphod]

I read the post from the perspective that his knowledge and skills could be transferred to another company in the same industry.

We have recently had an incident involving this. The employee left our company to join a competitor, and despite the clause in the contract prohibiting this, we were advised that it was unenforceable.

I also think that if you start to add too many anti-competitive clauses into the contract, the ultimate affect will be that the top talent will simply not even be interested in joining the company at all.

[the machine]

"Top Staff" are rightly entitled to the same freedoms as the rest of us to go where the money is. Eric Mathews would not have been privy to information that other NZO staff were not also privy to, so the information that he knows is not lost to NZO. AWE are most likely paying for his abilities, not for any specific information. If Eric Mathews were to divulge information to which NZO owns the intellectual property, then there would be grounds for a court case.

eric mathews is a good bloke and very highly regarded

maybe is nzo not shift to wellington then might still be working for nzo

at least through awe/tui, nzo can still gain his very valuableinput

M

[Rabbi]

We prefer to wait until a rig is obtained and there is a commitment made by the joint venture to drill. The joint venture is addressing the matter with some urgency but there is no announcement to be made at this time.

All well and good Chris. Unfortunately, with a drifting share price tied to the WTI,the market is looking for more direction than Dave Salisburys' rather cynical pronouncements

As I see it NZO needs

1. The WTI to stabilize and recover.

2. A more positive announcement regarding the future direction of the Company; because while the Board -and David Salisbury-are rightly being circumspect, this is obviously being perceived as prevarication. Everyone is still being paid while nothing is happening, therefore money is spent on salaries for people, who can't , or won't, make a decision.:eek:

[Nitaa]

All well and good Chris. Unfortunately, with a drifting share price tied to the WTI,the market is looking for more direction than Dave Salisburys' rather cynical pronouncements

As I see it NZO needs

1. The WTI to stabilize and recover.

2. A more positive announcement regarding the future direction of the Company; because while the Board -and David Salisbury-are rightly being circumspect, this is obviously being perceived as prevarication. Everyone is still being paid while nothing is happening, therefore money is spent on salaries for people, who can't , or won't, make a decision.:eek:
Thats pretty rough Rabbi. I am personally taking them on in good faith. What nzo has achieved has been quite remarkable. tui coming on stream in almost breakneck speeds and setting a record for the fatest payback. pike come to fruitition were many would have given up. kupe although well over inital budget like pike is going to reap rewards medium to long term.

Let the market dictate the sp without nzo trying to prop up the sp just to please the ones who are only after a quick buck. As a holder i would love to see the sp keep going up but no stock ever does that. As it is long term shareholders have done very well out of it thanks to their patience.

Still we live in interesting times

[manxman]

...setting a record for the fatest payback...



Fastest payback was good. Fattest payback will be even better.
The invisible hand guiding Nita's pen?

[777]

Nita a good reply. Much needed.

[Juggernaut]

2. A more positive announcement regarding the future direction of the Company; because while the Board -and David Salisbury-are rightly being circumspect, this is obviously being perceived as prevarication. Everyone is still being paid while nothing is happening, therefore money is spent on salaries for people, who can't , or won't, make a decision.:eek:

I would rather see them take their time to thoroughly evaluate all options than make a rush decision.


- long term holder NZO

[Casa del Energia]

I would rather see them take their time to thoroughly evaluate all options than make a rush decision.


- long term holder NZO

Agree. For those with an ear close to the ground - it is obvious by now that there is a lot going on under the hood than is published. Comments from partners in the Tui field, hiring of a battalion of geologists, murmurs of purchasing opportunities all ads up to a 'watch this space' notice. There is no problem with me over a 'lack' of press statements etc., trumpeting or constant leaks; in fact it all adds to the confidence because the approach is measured and professional. And if the sp drifts a little because of the 'quietness' - so be it, that at least leaves the option open to buy in more deeply at a very good price. So let the traders fool around with the sp for the moment - their day will pass.

[spook]

So a good lift in the SP today. Is that because of the Hurricane activity? I'm wondering if any TA experts can tell us what their MAs and Ficonaccis have to say?

[Corporate]

So a good lift in the SP today. Is that because of the Hurricane activity? I'm wondering if any TA experts can tell us what their MAs and Ficonaccis have to say?

Not sure if it's to do with potential hurricanes - Oil went down last friday. However, slightly up now.

I think it's more that the people willing to "give there shares away" is reducing. Plus lure of ex dividend date could also be a factor.

Where's digger at - haven't seen a comment for a while and a few things have happened recently.

[Casa del Energia]

Not sure if it's to do with potential hurricanes - Oil went down last friday. However, slightly up now.

I think it's more that the people willing to "give there shares away" is reducing. Plus lure of ex dividend date could also be a factor.

Where's digger at - haven't seen a comment for a while and a few things have happened recently.


Very few willing to meet the bids, so it inched consistantly forward during the day - very different flavour to the last couple of weeks. Wonder if it's a new trend.

Digger? Wasn't there a comment about shifting house and no broadband set up?

[777]

He has popped up using a different name on this thread. He is the last entry at the moment.

http://www.sharetrader.co.nz/showthread.php?t=2392&page=71

[Corporate]

Very few willing to meet the bids, so it inched consistantly forward during the day - very different flavour to the last couple of weeks. Wonder if it's a new trend.

Digger? Wasn't there a comment about shifting house and no broadband set up?

yeah i kept an eye on it during the day and it did as you say inch forward. No-one dumping needlessly.

[fish]

Spoke to digger tonight
He is Alive and Well but still without e-mail and missing this thread .
Told me he is going to Wellington next week and has a meeting with DS arranged(to do with trying to get a shareholder on the board whose main focus will be on shareholders eg listening to all shareholders,bringing up concerns at board level,encouraging new shareholders ,enhancing sp ,ensuring surplus cashflow/profits are paid out twice yearly if possible )
No doubt he will be posting as soon as he can and telling us all about it as only he can .

[duncan macgregor]

Spoke to digger tonight
He is Alive and Well but still without e-mail and missing this thread .
Told me he is going to Wellington next week and has a meeting with DS arranged(to do with trying to get a shareholder on the board whose main focus will be on shareholders eg listening to all shareholders,bringing up concerns at board level,encouraging new shareholders ,enhancing sp ,ensuring surplus cashflow/profits are paid out twice yearly if possible )
No doubt he will be posting as soon as he can and telling us all about it as only he can . I know how DIGGER feels going through similar circumstances just having moved myself.
Telecom are a bunch of useless no hoping incompetants when you try to get re-established in a new house. Macdunk

[fish]

I know how DIGGER feels going through similar circumstances just having moved myself.
Telecom are a bunch of useless no hoping incompetants when you try to get re-established in a new house. Macdunk

Dont think its telecoms fault-he is waiting for a satellite link-keeps getting postponed

[Corporate]

Spoke to digger tonight
He is Alive and Well but still without e-mail and missing this thread .
Told me he is going to Wellington next week and has a meeting with DS arranged(to do with trying to get a shareholder on the board whose main focus will be on shareholders eg listening to all shareholders,bringing up concerns at board level,encouraging new shareholders ,enhancing sp ,ensuring surplus cashflow/profits are paid out twice yearly if possible )
No doubt he will be posting as soon as he can and telling us all about it as only he can .


Thanks for the post fish. That sounds extremely positive, Digger meeting with DS. Love to here all about it when possible

[Rabbi]

How long before price of oil breaks through $1.00 barrel!:(

PRICE*CHANGE% CHANGETIME Nymex Crude Future103.97-2.37-2.2312:08 Dated Brent Spot99.57-1.89-1.8612:38 WTI Cushing Spot103.83-2.51-2.3612:05
These prices about midday in USA.

[duncan macgregor]

How long before price of oil breaks through $1.00 barrel!:(

PRICE*CHANGE% CHANGETIME Nymex Crude Future103.97-2.37-2.2312:08 Dated Brent Spot99.57-1.89-1.8612:38 WTI Cushing Spot103.83-2.51-2.3612:05
These prices about midday in USA. No worries my friend the games begin after the games end. One more month of doom and gloom for you oilers, who seem to think you are better off in a high price oil market. The opposite will happen as you will shortly find out when the price of oil trends up crashing your market. Macdunk

[CAM]

No worries my friend the games begin after the games end. One more month of doom and gloom for you oilers, who seem to think you are better off in a high price oil market. The opposite will happen as you will shortly find out when the price of oil trends up crashing your market. Macdunk


You should be able to make a killing on the oil futures market then:)

[Mr Tommy]

No worries my friend the games begin after the games end. One more month of doom and gloom for you oilers, who seem to think you are better off in a high price oil market. The opposite will happen as you will shortly find out when the price of oil trends up crashing your market. Macdunk

Big call Duncan, oil down to 101 this morning.

Opec meeting today, they might decide to shut off some supply.

[trackers]

Brent has hit $99, ouch... NZO @ 150c, geez talk about a bargain...Might have to grab some today (just wish I had a crystal ball to tell me wtf is going on with POO - its the first time in a while that I can honestly claim to have absolutely (!!) no idea)

[Casa del Energia]

No worries my friend the games begin after the games end. One more month of doom and gloom for you oilers, who seem to think you are better off in a high price oil market. The opposite will happen as you will shortly find out when the price of oil trends up crashing your market. Macdunk


Both you and Digger have a view that China will 're-start' after the games. But Beijing and its precincts are small part of a very big place. Moreover, there are signs of a property slump appearing there - and property slowdown being the first step on the downside of the business cycle may mean that China (India too?) are finally obeying normal economics and come to terms with the fact that gravity exists.
At any rate - crystal balling on Chinas energy consumption is a hazardous place - they keep their inventory figures to themselves (if they actually know them anyway) and coal reserves and production figures are a pile of bulldust). In short - nobody really knows - including the Chinese.

But then - I'm probably a wrong on this as the next bloke.

[Sehnsucht888]

After the games 3 million cars are allowed back on the roads and all the businesses that had been poluting the skys over china will start up again.
Thats sure to have some impact, just what is uncertain.

"China, the world's No. 4 economy, may have lost as much as 3% of its estimated 24.6 trillion-yuan ($4.2 trillion) gross domestic product by shutting down factories in Beijing and surrounding areas for two months, Mr Tao said.

Some factories, including Beijing Shougang, the nation's fourth-biggest steelmaker, were evicted from the capital.

The affected regions generate about 26% of China's economic output, so the world's fastest-growing major economy will slow during the next two months, Goldman Sachs says."

We are talking major industry offline, and coming back on.

[Bilo]

OPEC cutting by 500,000bopd:

http://news.smh.com.au/world/opec-to-cut-output-by-520000-bpd-opec-president-20080910-4dd3.html

Tropical storm IKE keeping oil and gas turned off in Gulf of Mexico.
Some think that IKE will gain strength as it progresses towards Texas/Mexico

Interesting to see how much control will be exerted to keep the POO around USD100.

[Casa del Energia]

After the games 3 million cars are allowed back on the roads and all the businesses that had been poluting the skys over china will start up again.
Thats sure to have some impact, just what is uncertain.

"China, the world's No. 4 economy, may have lost as much as 3% of its estimated 24.6 trillion-yuan ($4.2 trillion) gross domestic product by shutting down factories in Beijing and surrounding areas for two months, Mr Tao said.

Some factories, including Beijing Shougang, the nation's fourth-biggest steelmaker, were evicted from the capital.

The affected regions generate about 26% of China's economic output, so the world's fastest-growing major economy will slow during the next two months, Goldman Sachs says."

We are talking major industry offline, and coming back on.

Points taken. However - note that the total number of private motor vehicles in China is 25 million - that's 12% of cars off the road - quite a proportion BUT there are 550 million cars on the planet - - the 3 million cars off the road in Beijing is about 1/2% of the total. It's difficult to see how Beijing cars are going to have a global impact post Olympics.
Certainly no impact on NZO sp?

[Bilo]

OPEC cutting by 500,000bopd:

Tropical storm IKE keeping oil and gas turned off in Gulf of Mexico.
Some think that IKE will gain strength as it progresses towards Texas/Mexico

Interesting to see how much control will be exerted to keep the POO around USD100.

Latest forecast has IKE increasing in strength with winds reaching 105kts before hitting the coast. Massive storm surge possible. Sometimes I wonder if Americans go into denial mode during election periods....someone is detailed to keep the lid on energy prices - what could the POO go to when artifically suppressed for a period?

[Nitaa]

Latest forecast has IKE increasing in strength with winds reaching 105kts before hitting the coast. Massive storm surge possible. Sometimes I wonder if Americans go into denial mode during election periods....someone is detailed to keep the lid on energy prices - what could the POO go to when artifically suppressed for a period?Bilo. Without sounding critical, the storms etc only have a very small temporary impact. In fact you only have to look at the oil prices slide over the last few weeks and along with the amount of hurricanes it is largley irrevelant.

The biggiest issue over a medium to longer term is the supply and demand. OPEC cutting oil supply is a measure they do not want prices to go too low. I also think they dont want it to go too high. Ultimatley they will want to find an optimum level that encourages demand and maitain the highest price possible.

The dramatic rise already showed how much of an impact it has on global economies especially the 3rd world countries. To a greater degree we are all at the mercy of the people pulling the strings.

[Bilo]

Bilo. Without sounding critical, the storms etc only have a very small temporary impact. In fact you only have to look at the oil prices slide over the last few weeks and along with the amount of hurricanes it is largley irrevelant.

The biggiest issue over a medium to longer term is the supply and demand. OPEC cutting oil supply is a measure they do not want prices to go too low.

I agree Nita. 90pc of US gulf of Mexico oil and gas production has been out for a couple of weeks now and IKE will prolong this. Any surplus inventory that was in the system B4 will be reduced and reducing further. Wait for the inventory rpt tonight - see if they bend the truth as much as usual...

On the demand side reductions in use are usually short lived.
On the supply side disruptions to the production activities have an effect for many years.

[Mingeathinaikos]

Both you and Digger have a view that China will 're-start' after the games. But Beijing and its precincts are small part of a very big place. Moreover, there are signs of a property slump appearing there - and property slowdown being the first step on the downside of the business cycle may mean that China (India too?) are finally obeying normal economics and come to terms with the fact that gravity exists.
At any rate - crystal balling on Chinas energy consumption is a hazardous place - they keep their inventory figures to themselves (if they actually know them anyway) and coal reserves and production figures are a pile of bulldust). In short - nobody really knows - including the Chinese.

But then - I'm probably a wrong on this as the next bloke.

'MOREOVER', you have to be French?

[Casa del Energia]

'MOREOVER', you have to be French?

Mes non. Born and bred NZ - folks South American/Anglais, "Casa del Energia' es Espanol. Is 'moreover' a French habit?

[Bilo]

Latest forecast has IKE increasing in strength with winds reaching 105kts before hitting the coast. Massive storm surge possible. Sometimes I wonder if Americans go into denial mode during election periods....someone is detailed to keep the lid on energy prices - what could the POO go to when artifically suppressed for a period?

Latest forecast has IKE "as a very large storm" "regardless of where it hits the coast its effects will be felt over a very large area"
winds now forecast to reach 115kt before hitting the coast and the storm is trending northwards

If i was in the region i would be driving north - Gustav was a pup that turned pussy. IKE looks the real deal.

The inventory was as expected (by me) but the oil price response was muted - as it probably should be as no wants to profit from others misfortune - or do they now in these dog eat dog market places?

USD 100 appears to be the agreed price..

NZD going southwards. Could we be back to less than US60c in the near future? NZO & PRC still looking to be in a sweet spot.

[fish]

[QUOTE=Bilo;222566]Latest forecast has IKE "as a very large storm" "regardless of where it hits the coast its effects will be felt over a very large area"
winds now forecast to reach 115kt before hitting the coast and the storm is trending northwards

If i was in the region i would be driving north - Gustav was a pup that turned pussy. IKE looks the real deal.

The inventory was as expected (by me) but the oil price response was muted - as it probably should be as no wants to profit from others misfortune - or do they now in these dog eat dog market places?

USD 100 appears to be the agreed price..

NZD going southwards. Could we be back to less than US60c in the near future? NZO & PRC still looking to be in a sweet spot.[/QUOT

Looks as if Ike is going to hit at the heart of GOM oil rigs and will strengthen to H3.
Most of the oil production has been shutdown-yet the oil price still falls-in us dollars .
nzo sp continues to keep a close relation to poo- fall-down to 151
Tui continues to produce well with higher production figures and oil price (in NZ$ around $800000 a day ) .
With such strong cash flow a twice yearly dividend would be in order for next year as well

[Mingeathinaikos]

Mes non. Born and bred NZ - folks South American/Anglais, "Casa del Energia' es Espanol. Is 'moreover' a French habit?

From what I deal with on a daily basis, it does appear to be a French habit (and it drives me mad! :) ). I beleive there is a French word that directly translates to 'moreover', however in most contexts 'also' would fit the translation better.

[Anubis]

I think the French is "de plus" or "en plus" - they use it a lot where we would probably just say "and what's more".

I've been quite pleased with the way NZO's share price has held up the last few days, considering the way other oilers have been battered down in Aus. AWE is down to $2.70 close today - it was at $3.50 last week!! NZO may be fundamentally undervalued at this price, but there does at least seem to be some recognition of underlying fundamentals that is supporting the price at this level. Either that or it's the dividend. I hope I haven't jinxed it now by writing this!!

[Nitaa]

I think the French is "de plus" or "en plus" - they use it a lot where we would probably just say "and what's more".

I've been quite pleased with the way NZO's share price has held up the last few days, considering the way other oilers have been battered down in Aus. AWE is down to $2.70 close today - it was at $3.50 last week!! NZO may be fundamentally undervalued at this price, but there does at least seem to be some recognition of underlying fundamentals that is supporting the price at this level. Either that or it's the dividend. I hope I haven't jinxed it now by writing this!!
I think AWE is an absolute scream at these prices. Definately investors concerned the arrse will fall out of oil prices. To put things into perspective most would have relished oil being around $100 pbo especially the tui jv. Coupled with a nosediving currency the revenue is around $NZ650k per day after operating expenses . Meanwhile awe is creaming over $AU1.5m per day after operating expenses. PPP is pretty useful and i dont think AT is concerned at all

[Rabbi]

Texas has about 16 refineries that may be impacted by Hurricane Ike. Five refineries have begun shutting down in anticipation of the hurricane. Those plants can process about 1.33 million barrels per stream day of crude oil or about 6.9 percent of the U.S. refining capacity.

Because refineries are shutting down there is less demand for crude but I see this as a very short term reaction to a short term phenomenon. The fall in the price of oil has slowed to a trickle and there may be some hope of resistance around $1 barrel.

Oil and Gas exploration companies have been oversold but I am sure when the price of oil and Gas consolidates we will see a significant re-rating.:)

[trackers]

Picked some of these up yesterday. Too cheap imo. Surprised POO fell overnight, but our weak exchange rate vs USD keeping the ship steady for NZO. A 5c divvie next week will be nice too :)

[Corporate]

$1m already traded this morning! is something up?

[sideline]

$1m already traded this morning! is something up?

Not much of that volume on the market though, mostly special crossings.

[Xerof]

I don't think anyone has posed the most obvious question:

Has NZO hedged any forward production, other than that required by their umbrella weilding bankers?

Maybe it's not policy to do so, but the question should at least be asked and answered.

[upside_umop]

There was no mention of it in the annual report.
Remember - only the bankers win if they do this...

If PPP/NZO were to hedge half of their forecast production, there would be reduced risk which should translate to an increased share price.

[Nitaa]

There was no mention of it in the annual report.
Remember - only the bankers win if they do this...

If PPP/NZO were to hedge half of their forecast production, there would be reduced risk which should translate to an increased share price.
I am dead against any hedging unless necessary. eg. required to secure funding as were the case. if you hedge oil prices then you need to hedge the currency. keep doing that and there will be nothing left.

If oil prices were to be hedged, at what price would you expect the company to hedge it at? When the oil prices climbed to $70, $100, $150? In my opinion i say no no no. I accept the risk of oil going down below $50 and accept the reward if it goes beyong $150.

If nzo were to hedge then they would need to hedge or insure against capex cost. imagine hedging oil prices at $100 only to find capex and operating cost increase 5 fold over the next 5 years for exploration and development. were would it leave nzo? then you need to insure against earthquakes, terrorism, strikes.

as you can see, my view is a big fat definate no

[ritchie]

Hi there.

Just want to confirm that if I purchased shares at 1630 on the 19th septemeber and then sold them first thing on the 20th......I would be paid out for the 5 cent dividend.

Cheers

[Nitaa]

Hi there.

Just want to confirm that if I purchased shares at 1630 on the 19th septemeber and then sold them first thing on the 20th......I would be paid out for the 5 cent dividend.

Cheersnot sure of the exact time but in a nut shell yes. keep in mind you will have brokerage fee and all things being equal you will make a slight loss as the sp will adjust itself accordingly.

[upside_umop]

Hi Nita,

Usually companies dont hedge in one go, unless its part of their financing arrangements.

Blocks are most common...ie rolling 20% per annum. FPH hedged at 45cent USD...it enabled them amazing growth.

Financial instruments can be very useful, and its a shame that so many people never take advantage of them. The biggest drag on NZO is the oil price risk...since NZD is a commodity currency we have a partial hedge to falling crude anyway. But why stop there? If oil continues its trend downwards, and you hedge (partially) you win both ways. Right?

Risk reward? By hedging, you take less risk and you gain greater reward. If, say, all production was hedged (hypothetically) then NZO should theoretically increase towards its brokers estimates (probably higher given oil risk will be taken out). The only thing left is the operational risk...

I dont understand your concept with cap ex as you wouldnt hedge for production you dont already anticipate. Ie You would only hedge for such things as tui...therefore only opex matters..we dont see that changing too much in the next year.

I suppose it all depends how risk averse you are, or whether you see opportunity.

[ritchie]

thanks Nita.

Last divi didnt the share price go up......??????

[Nitaa]

thanks Nita.

Last divi didnt the share price go up......??????yes it did and i think it its a reasonable chance of doing it again. however the markets are very volatile. ie. you could be in for a penny, out for a pound or in for a pond out for a penny.

[Nitaa]

Hi Nita,

Usually companies dont hedge in one go, unless its part of their financing arrangements.

Blocks are most common...ie rolling 20% per annum. FPH hedged at 45cent USD...it enabled them amazing growth.

Financial instruments can be very useful, and its a shame that so many people never take advantage of them. The biggest drag on NZO is the oil price risk...since NZD is a commodity currency we have a partial hedge to falling crude anyway. But why stop there? If oil continues its trend downwards, and you hedge (partially) you win both ways. Right?

Risk reward? By hedging, you take less risk and you gain greater reward. If, say, all production was hedged (hypothetically) then NZO should theoretically increase towards its brokers estimates (probably higher given oil risk will be taken out). The only thing left is the operational risk...

I dont understand your concept with cap ex as you wouldnt hedge for production you dont already anticipate. Ie You would only hedge for such things as tui...therefore only opex matters..we dont see that changing too much in the next year.

I suppose it all depends how risk averse you are, or whether you see opportunity.i beleive hedging is very useful in some areas. however hedging the oil prices is just like taking insurance.

you make a point that oil continues to down trend and you hedge then you win both ways. well you will in that case but then the opposite would happen if oil rises.

fph is a a different kettle of fish. some exporters have to hedge otherwise they can go broke in no time or make a killing. it helps control your revenue and helps your forward planning. However if you notice, nzo is still getting around $NZ150 pbo. the downward price of oil has been somewhat negated by the fall in the $NZ.

As i mentioned, hedging is just another form of insurance. As we know, insurance is bloody expensive unless you need it. at the moment nzo dont need it

[Chalice]

i beleive hedging is very useful in some areas. however hedging the oil prices is just like taking insurance.

you make a point that oil continues to down trend and you hedge then you win both ways. well you will in that case but then the opposite would happen if oil rises.

fph is a a different kettle of fish. some exporters have to hedge otherwise they can go broke in no time or make a killing. it helps control your revenue and helps your forward planning. However if you notice, nzo is still getting around $NZ150 pbo. the downward price of oil has been somewhat negated by the fall in the $NZ.

As i mentioned, hedging is just another form of insurance. As we know, insurance is bloody expensive unless you need it. at the moment nzo dont need it

Hi Nita - good point, seems to be leading to a $US100 happy point for everyone, esp. NZO given the $NZ.
The $NZ150 pbo? Not wanting to nit(a) pick but it is out quite a bit. $US110 for Tapis at 0.655 = $NZ167 - significantly more - ballpark figues but X by barrels expected...

[777]

Hi Nita - where/how do you get the $NZ150 pbo? Seems out quite a bit.


Exchange rate at about .655 gives approx $150 NZ.

[Nitaa]

Hi Nita - good point, seems to be leading to a $US100 happy point for everyone, esp. NZO given the $NZ.
The $NZ150 pbo? Not wanting to nit(a) pick but it is out quite a bit. $US110 for Tapis at 0.655 = $NZ167 - significantly more - ballpark figues but X by barrels expected...I am basing it after operating expenses/shipping. If i am not mistaken is about 10% of the cost. Someone can correct me here pls.

[Chalice]

Exchange rate at about .655 gives approx $150 NZ.

Yeah right, in that case I'll give you $1.37 for your shares, which is approx what they are worth...

Its more like approx $170, but as Nita has alluded, the $150 was post expenses, which from memory are about the lowest enjoyed anywhere in the producing world.

[boysy]

Opex is under $10 a barrel if this helps in any ways

[Sideshow Bob]

I am basing it after operating expenses/shipping. If i am not mistaken is about 10% of the cost. Someone can correct me here pls.

Hi Nita,

Hope all is well.

Total opex for Tui is stated at <$10 US/barrel.

http://www.nzog.com/presentations - Forsyth Barr presentation, page $12. Also say later on the NZO's share of opex for Tui until 2012 is expected to be $44m US.


Cheers
SSB

[Nitaa]

Hi Nita,

Hope all is well.

Total opex for Tui is stated at <$10 US/barrel.

http://www.nzog.com/presentations - Forsyth Barr presentation, page $12. Also say later on the NZO's share of opex for Tui until 2012 is expected to be $44m US.


Cheers
SSBThanks SSB. all is well and appreciate the clarification

To get back to my earlier post. Malaysia Tapis 44 which tui oil is a good guide is around $US110 less op expenses make it about $US100 x $NZ1.50 (as of 2 minutes ago). ie 35,000 bopd = a tidy $NZ525,000. All this and Pike is all but ready and Kupe on stream next year.

[the machine]

one would expect tapis to surge a bit after effects of hurricane ike impact on refining capacity in usa

M

[arjay]

I finally found a copy of Twilight in the Desert and read it. I had to go to London for it though - quite a carbon footprint eh? If anyone is desperate for a copy, Foyles bookstore still have a few copies on the shelves.

I agree with Bermuda - it's a sobering read. It's well researched although the writing style is a bit over dramatic. If I had read this book at the time of publishing I would have come away expecting a major supply crisis from the Saudis in 2006. This didn't happen, and clearly Saudi's ability to supply may be a bit better than Mr Simmons would have us believe. Nevertheless, there are some good lessons to be taken from the book. I was very interested in reading about how many oil producers (the British in the North Sea especially) have squandered the ability to maximize field oil recovery over the longer term, by overproduction for short-term gain. This made me think about Tui. Has production from the Tui area reservoirs been tailored for maximum total oil recovery, or maximum volume of oil during the operators accounting horizon? Hopefully the former.

[fish]

Thanks SSB. all is well and appreciate the clarification

To get back to my earlier post. Malaysia Tapis 44 which tui oil is a good guide is around $US110 less op expenses make it about $US100 x $NZ1.50 (as of 2 minutes ago). ie 35,000 bopd = a tidy $NZ525,000. All this and Pike is all but ready and Kupe on stream next year.


I think you are under-estimating Nita-if you look at tui on the nzog website you will see the average price so far this financial year is over $180 nz per barrel and production performance is well above recent predictions despite some lost days



Oil Production since 1 July 2008:

1 July-10 September: Approx 2.6 million barrels. NZOG's share of production approx 325,000 barrels.
divide by 72 days=4514 barrels a day at 170 a barrel=$767380 per day after costs but before tax and royalties

Please check the figures and let me know if you agree
Hoping for another special dividend in April !

[trackers]

I finally found a copy of Twilight in the Desert and read it. I had to go to London for it though - quite a carbon footprint eh? If anyone is desperate for a copy, Foyles bookstore still have a few copies on the shelves.

I agree with Bermuda - it's a sobering read. It's well researched although the writing style is a bit over dramatic. If I had read this book at the time of publishing I would have come away expecting a major supply crisis from the Saudis in 2006. This didn't happen, and clearly Saudi's ability to supply may be a bit better than Mr Simmons would have us believe. Nevertheless, there are some good lessons to be taken from the book. I was very interested in reading about how many oil producers (the British in the North Sea especially) have squandered the ability to maximize field oil recovery over the longer term, by overproduction for short-term gain. This made me think about Tui. Has production from the Tui area reservoirs been tailored for maximum total oil recovery, or maximum volume of oil during the operators accounting horizon? Hopefully the former.

Hey Arjay,

Read it too, pretty much the same conclusions... Very interesting, quite worrying (though not quite at the doomsday type levels M.simmons would have us believe).

As for over production, with a standby well at TUI allowing for rotation, don't think we have/will have that problem.

[Rabbi]

I got that book on loan ( Twilight in the Desert) from Serpie at the National Sharetrader Convention. We just bring them back to the next meeting and re-cycle them thereby enhancing everyone's education at no expense. I have to say it's very interesting how Saudi Oil is running down, and one could say -,at $150- barrel this has been factored in. So at $100 barrel, the whole scenario has been discounted again, thanks to Index traders and the like.

The Reality is- as Winston Peters was wont to say-that Oil is a commodity that is a finite resource. All we need is a price that keeps everyone fillling their tanks and the upstream producers in good profit. $100 barrel might now seem cheap to most pundits, and the Upstream Companys such as NZO will still be raking it in.

NZO a steal a $1.50 on this assumption!:)

[sideline]

I got that book on loan ( Twilight in the Desert) from Serpie at the National Sharetrader Convention. We just bring them back to the next meeting and re-cycle them thereby enhancing everyone's education at no expense. I have to say it's very interesting how Saudi Oil is running down, and one could say -,at $150- barrel this has been factored in. So at $100 barrel, the whole scenario has been discounted again, thanks to Index traders and the like.
............


Public libraries in the Auckland region usually have a few copies, catalogue search shows
- 2 in Auckland
- 2 in Waitakere
- 3 in Takapuna

Personally I found the style of the book a little bit too 'preachy', in places speculative and exaggerated.
I much preferred the sometimes dry but more factual style of K. Deffeyes. (Beyond Oil, the view from
Hubbard's peak).

What I got though from the detailed descriptions of the Saudi oil fields is the impression that
there still could still be a pretty big resource underground but the problem is recoverability
and production rate against a growing world demand. Those factors translate into a rising
price for production (both financial and energywise) and of course a peaking/declining supply
somewhen (soon (- my opinion)).

[Sideshow Bob]

If anyone wants to borrow a copy of Twilight in the Desert, I'm happy to loan them mine.

I just ordered mine through Uni Book Shop in Dunedin and took about 10 days - $26.

Cheers

[upside_umop]

i beleive hedging is very useful in some areas. however hedging the oil prices is just like taking insurance.

you make a point that oil continues to down trend and you hedge then you win both ways. well you will in that case but then the opposite would happen if oil rises.

fph is a a different kettle of fish. some exporters have to hedge otherwise they can go broke in no time or make a killing. it helps control your revenue and helps your forward planning. However if you notice, nzo is still getting around $NZ150 pbo. the downward price of oil has been somewhat negated by the fall in the $NZ.

As i mentioned, hedging is just another form of insurance. As we know, insurance is bloody expensive unless you need it. at the moment nzo dont need it

im not trying to get into an argument over where oil is going, but if options were to be used for a portion of production, then it is essentially money in the bank, yes? therefore it should be recognized by the market, as its underlying revenue stream is less volatile. shareprices are inversely correlated to volatility of their revenue streams, and in nzo's case, the underlying factor to its revenue stream is oil price..i guess you could say so is the nzd, but thats easily sorted too.

options are valued at fair value...so therefore are never usually mispriced to be 'expensive' as arbitragers will reduce any riskless profits.

you also say earlier that insurance would be needed. not for 'options' ...only if you were to be in a forward contract that would be the case...

options also can give limited downside, unlimited upside, if thats what your concerned about. nzo and ppp's arrangement involves a strategy called a 'collar' which limits both upside and downside for no outlay.

[Mick100]

im not trying to get into an argument over where oil is going, but if options were to be used for a portion of production, then it is essentially money in the bank, yes? therefore it should be recognized by the market, as its underlying revenue stream is less volatile. shareprices are inversely correlated to volatility of their revenue streams, and in nzo's case, the underlying factor to its revenue stream is oil price..i guess you could say so is the nzd, but thats easily sorted too.

options are valued at fair value...so therefore are never usually mispriced to be 'expensive' as arbitragers will reduce any riskless profits.

you also say earlier that insurance would be needed. not for 'options' ...only if you were to be in a forward contract that would be the case...

options also can give limited downside, unlimited upside, if thats what your concerned about. nzo and ppp's arrangement involves a strategy called a 'collar' which limits both upside and downside for no outlay.


your approach is typical of an academic type upside down
your putting a lot of emphasis on the benifits of hedging with little regard to the costs - options are great - as you say - limit the downside leaving unlimited upside - but they are expensive (premiums)

as has been pointed out numerous times already - with the price of oil currently being negitively correlated to the value of the USD and the NZD also being negitively correlated to the value of the USD, there is a natural hedge with regards to the NZD price of oil, ie - no need to enter into complicated, expensive hedging arrangments IMO.

[upside_umop]

Mick, I'm merely stating a way of increasing the shareprice for those short term daily shareprice moaners..

We have had a perfect storm for a depreciating NZD, with a tumbling in dairy prices, and massive OCR cuts, and yet, in NZD oil has still declined 20% from its peak, not quite the full natural hedge we are after.

A portion of production was all i was saying, and options are only as expensive as the market percieves them to be. In the long run, do you lose disadvantage? Who makes the money? Or are you guys implying the other willing seller/buyer of the option always has more knowledge than us? Murphies Law etc?

I suppose I was wrong with saying options are never usually mispriced...its impossible to determine future factors that they use to value options. Ie implied volatility.

Mick says 'as has been pointed out numerous times already - with the price of oil currently being negitively correlated to the value of the USD and the NZD also being negitively correlated to the value of the USD, there is a natural hedge with regards to the NZD price of oil, ie - no need to enter into complicated, expensive hedging arrangments IMO.'

Of course the NZD will go down if the USD goes up? Were you trying to say the NZD is inversely correlated to commodities...

Again, not complicated, and not expensive, as it works itself out in the long run. Its just a way of smoothing income flows.

[Nitaa]

upside. although i dont agree with your theory on an overall basis i do get what you are implying. i believe its a personal preference and a risk v reward scenario.

all the same as a holder of nzo i am extremely comfortable with the mid term outlook. if i was highly geared with my investment with mnz then i would prefer your theory completely and my downside risk would be too great. again i think its a personal preference.

[Mick100]

Mick says 'as has been pointed out numerous times already - with the price of oil currently being negitively correlated to the value of the USD and the NZD also being negitively correlated to the value of the USD, there is a natural hedge with regards to the NZD price of oil, ie - no need to enter into complicated, expensive hedging arrangments IMO.'

Of course the NZD will go down if the USD goes up? Were you trying to say the NZD is inversely correlated to commodities...

Again, not complicated, and not expensive, as it works itself out in the long run. Its just a way of smoothing income flows.

I'm hope most people understand the point I am making
USD goes up, oil goes down - it will be interesting to see what happens to the oil price this week with the USD looking like it's going to fall a bit
If my assumption holds, the USD price of oil should increase

[upside_umop]

Yes Nita, its a personal preference. I'm young, and dont mind the risk/reward either. :)

I know what you mean Mick...it was just the way it was said. I was being cheeky... :P
Maybe we will Mick, dollar certainly picked up a bit of strength. Time will tell..$100 is meant to be a really strong support, and if it holds a while then we should see a little rally in oil stocks.

What are your COT looking like?

[trackers]

Wow, serious discrepancies between NZO.nzx and NZO.asx lol!

[peterfindlay]

Wow, serious discrepancies between NZO.nzx and NZO.asx lol!

In Australia, NZO is ex dividend.

[rotweiller]

CompareShares.com.au have today published an article on NZO as being their "Share of the Week"and being a pensioner I dont know how to post it on this forum. Oh Dear!!
Cheers

[Sehnsucht888]

Thanks rotweiller.
Here is the link:
http://www.compareshares.com.au/wise71.php

Heres one they did 2 months ago:
http://www.compareshares.com.au/wise62.php

[Casa del Energia]

CompareShares.com.au have today published an article on NZO as being their "Share of the Week"and being a pensioner I dont know how to post it on this forum. Oh Dear!!
Cheers

The simplest way would be to cut n paste the web address from the address bar on your browser to your message content. E.g

http://www.sharetrader.co.nz/showthread.php?p=223043

was cut n pasted from my address bar for the share trader site.

Whoops - cancel that - 888 already did that..

[Nitaa]

CompareShares.com.au have today published an article on NZO as being their "Share of the Week"and being a pensioner I dont know how to post it on this forum. Oh Dear!!
CheersI am wondering.. do all stocks in the top 50 get a turn and the other 2 weeks is over the xmas period.

[Nitaa]

oil still sliding and down to $96

[bermuda]

oil still sliding and down to $96


That is getting seriously near my $90 minimum. Solar and wind grants are being cancelled by the day. Alternative energy?

We know not what we do.

[manxman]

oil still sliding and down to $96

Byron King quoted on Marketwatch


King also makes the interesting point that the world is getting more hostile to Western oil companies: "As recently as the late 1970s, Western oil companies controlled well over half of the world's oil production. But now the NOC's [state-owned national oil companies) such as Saudi Aramco, National Iranian Oil Co., Kuwait Oil Co., Petroleos de Venezuela, Petroleos Mexicanos (Pemex), etc. control over 85% of the world's oil resources. Western majors control about 7% of the world's oil resource base."
King complains: "Yet in the face of all this, the market is currently selling off oil and other energy players. The market is selling off oil field service companies, infrastructure companies, precious metals companies and even basic metals.
"Would somebody please introduce Mr. Market to Dr. Depletion?"

"The market can stay irrational longer than you can stay solvent" - Keynes

[Rabbi]

09:45 ET Dow -321.26 at 11109.26, Nasdaq -52.74 at 2208.53, S&P -35.95 at 1215.75: The stock market opens sharply lower, with the S&P 500 down nearly 3%. [B]Lehman Brothers (LEH 0.29, -3.36) filing for bankruptcy...

The financial sector is down 4.9%. Oil prices are down 5.4% to $95.74 per barrel, sending oil to a 0.2% year-to-date loss and its lowest price since February.

Where will it all end. :eek:

[Casa del Energia]

Hang on to the railings, it's going to be a rough one today.
Perhaps this is where McDunk gets to crow.

[sideline]

Hang on to the railings, it's going to be a rough one today.
Perhaps this is where McDunk gets to crow.

Some thoughts from The Oil Drum http://www.theoildrum.com/node/4534 about
how the US financial crises effects the oil price at the moment:


(1) Some of the organizations with problems were no doubt speculating in oil futures. Once the prices started to drop, the balance sheets of the organizations were affected, and they suddenly needed more capital.

(2) As the companies who speculated in the oil market (all of them, not just the particular ones having problems today) try to unwind their positions because of margin calls, they drive down the price of oil in the futures market. That is likely why we are seeing declining oil prices, at a time when fundamentals would say they should be rising.
....

[Mr Tommy]

Now if you were a company with about $300m cash sitting in the bank, wouldnt this be a good time for you ?.

[777]

Perhaps NZO should reduce production at this point and wait for an increase in the POO.

[duncan macgregor]

Perhaps NZO should reduce production at this point and wait for an increase in the POO. If only everything was simple as that life would be easy. All those decisions are made well in advance booking in tankers arranging markets etc you simply cant behave like an old woman in a china shop changing her mind all the time. The NZO SP will side track, or drop down until the news of their future program comes out. The markets are starting to crash, taking the good and the bad to lower levels. NZO are not immune to market sentiment. Macdunk

[sideline]

Now if you were a company with about $300m cash sitting in the bank, wouldnt this be a good time for you ?.

It is an excellent position. And with credit getting harder to come by, some other developments
could get delayed and drilling rigs become more available - maybe we'll see one next year in
Taranaki?

[Casa del Energia]

Some thoughts from The Oil Drum http://www.theoildrum.com/node/4534 about
how the US financial crises effects the oil price at the moment:


Good points - those who bought for Sept delivery must have sick looking balance sheets now. But probably not the same impact as the loans failures - hedging just transfers wealth, bad debt makes it evaporate.

Aside: Just looking at the market, everything is really sick at the mo - but I have the consolation that NZO is the least of my losses today. (Well, always gotta look at the bright side).

[Crypto Crude]

keep this up, and I might just have to make some room for New Zealand Oil And Gas...
;)
.^sc

[Chalice]

keep this up, and I might just have to make some room for New Zealand Oil And Gas...
;)
.^sc

With NZO about to go ex-dividend, POO likely to be in the 80's sooner rather than later and PRC taking a pounding I would imagine that the SP will be at a level where margin calls may come back into play.

Time soon to be back in boots and all after exiting recently.

[Anubis]

I agree with this:

http://www.sharechat.co.nz/news/scnews/article.php/91fb63a2
ShareChat News: NZ stocks drop on global rout, unearthing some bargains
By Jonathan Underhill
Tuesday 16th September 2008

Quote: "The decline has created "some great opportunities" for investors taking more than a 24-hour view, Ward said. He cited New Zealand Oil & Gas, which has sunk 4.6% to NZ$1.45 today.

"Investors selling the stock weren't taking into account that the company is sitting on as much as NZ$280 million of cash and has an investment in Pike River Coal that would yield another NZ$150 million. Added to that, its oil field assets in Kupe and Tui were being under-valued, implying an oil price of around US$48 a barrel, he said."

[Chalice]

I agree with this:

http://www.sharechat.co.nz/news/scnews/article.php/91fb63a2
ShareChat News: NZ stocks drop on global rout, unearthing some bargains
By Jonathan Underhill
Tuesday 16th September 2008

Quote: "The decline has created "some great opportunities" for investors taking more than a 24-hour view, Ward said. He cited New Zealand Oil & Gas, which has sunk 4.6% to NZ$1.45 today.

"Investors selling the stock weren't taking into account that the company is sitting on as much as NZ$280 million of cash and has an investment in Pike River Coal that would yield another NZ$150 million. Added to that, its oil field assets in Kupe and Tui were being under-valued, implying an oil price of around US$48 a barrel, he said."

I totally agree, but I saw a comment recently - "the market has an ability to act irrationally longer than you have the ability to stay solvent" - or words to the same effect.

Not that I wish/intend to imply anything to that effect with regards current NZO shareholders - more it highlights the point, as McD has quite correctly pointed out on numerous occasions - the market doesn't always act rationally.
Point proven when you look at the extremely low POO sharebrokers have used for their SP targets above $2! For example Jonathon has indicated above that PRC will yield $150 million - can you see PRC @ current levels in 12 months when producing 100mt/yr?

Also remember current SP is taking into account a 5 cent dividend with a record date of Friday... @$NZ1.40 on ASX post div.

"The decline has created "some great opportunities" for investors taking more than a 24-hour view".

I'm certainly going to wait more than 24 hours before taking them!

[bermuda]

I totally agree, but I saw a comment recently - "the market has an ability to act irrationally longer than you have the ability to stay solvent" - or words to the same effect.

Not that I wish/intend to imply anything to that effect with regards current NZO shareholders - more it highlights the point, as McD has quite correctly pointed out on numerous occasions - the market doesn't always act rationally.
Point proven when you look at the extremely low POO sharebrokers have used for their SP targets above $2! For example Jonathon has indicated above that PRC will yield $150 million - can you see PRC @ current levels in 12 months when producing 100mt/yr?

Also remember current SP is taking into account a 5 cent dividend with a record date of Friday... @$NZ1.40 on ASX post div.

"The decline has created "some great opportunities" for investors taking more than a 24-hour view".

I'm certainly going to wait more than 24 hours before taking them!

I have put this on the wrong thread Chalice, Re your post on PRC I take it you are talking about 1 million tonnes per annum and not 100 metric tons.
It will take a while to crank up but I think their target annual production is just over 1 million tonnes. Apart from a few delays we are nearly at the coal face. What a major feat it will be to export this beautiful world class coking coal at record 'locked' in prices.

I remember looking at the price when it was 85 cents and asking myself why not put the lot on PRC. At 164 cents I am starting to have those thoughts again.

[Chalice]

I have put this on the wrong thread Chalice, Re your post on PRC I take it you are talking about 1 million tonnes per annum and not 100 metric tons.
It will take a while to crank up but I think their target annual production is just over 1 million tonnes. Apart from a few delays we are nearly at the coal face. What a major feat it will be to export this beautiful world class coking coal at record 'locked' in prices.

I remember looking at the price when it was 85 cents and asking myself why not put the lot on PRC. At 164 cents I am starting to have those thoughts again.

Yes Bermuda, quite right - I did mean 1 million tonnes per annum - slack semantics on my behalf, but I'd hope you'd assume that..

There has been talk about a PRC reserves upgrade - what/why/when this may occur I'm not sure.
If you take the current events as an overdue correction, for whatever reason, and have faith that people are generaly pretty damned smart (as proven by the last few millenia) and there are more of them everyday with an ever growing propensity and ability to raise their standard of living, you'd have to look upon high quality resourse stocks positively in the short/medium term.

The term being determinant upon the fallout in the USA and the possibility of Insurance companies to be next in line creating further "non-fundamental" drops.

There is a thread of "when to re-enter the market" - you'd have to be brave as a trader to get in now!

[KentBrockman]

May have been posted before, and doesn't really mention anything not already known:
(and there seems to be a paragraph in there that doesn't belong there)

http://www.compareshares.com.au/wise71.php

[trackers]

In Australia, NZO is ex dividend.

Can anyone confirm/deny this or post a link? Can't see any info to this effect anywhere :confused:

[shasta]

Can anyone confirm/deny this or post a link? Can't see any info to this effect anywhere :confused:

Trackers

This confirms what you are after

http://www.asx.com.au/asx/research/CompanyInfoSearchResults.jsp?searchBy=asxCode&allinfo=&asxCode=nzo

[trackers]

Trackers

This confirms what you are after

http://www.asx.com.au/asx/research/CompanyInfoSearchResults.jsp?searchBy=asxCode&allinfo=&asxCode=nzo

Ahh, thanks Shasta :)

[Juggernaut]

Looks like its going to be a bumpy ride today, so many sellers, dont they realise ex dividend day is friday!!, and a week away from PRC starting production!

[duncan macgregor]

NZO down to 141c at the moment which hopefully will be a good lesson to take on board about how useless fundamental anaysis is in a down trending market. Its all market sentiment whats love got to do with it. All companies will crap out in a crashing market the wise investor stands aside waiting to pick up the road kill. Think about how much money over the years you might have made with a simple 10% or 15% running stop loss.
Five years ago the sp was in the 130c range with some great rises and falls in between yet the fall in love with a company brigade blind themselves to the harsh reality of how the market works.
The price of oil will nearly double in 2009 so all is not lost macdunk will be waiting to buy your roadkill about then so hang on in the road is about to get much rougher. Macdunk

[remy]

macdunk didnt you say the crash would be because of the poo skyrocketing?? i wish it was, but arent the games over now?

[Sehnsucht888]

Hey remy - last day yesterday or today. So China should start sucking more in any time now.

One thing I am curious about is the effect of Ike on Oil requirements. I think I read that a large percentage of the refineries in the US gulf are out for a while, which means that they aren't taking much oil in I assume. Does that then leave a glut of oil in the market place pushing prices down in the short term?

[Nitaa]

macdunk didnt you say the crash would be because of the poo skyrocketing?? i wish it was, but arent the games over now?yes he did. he said oil would be at $200 by the end of the year. lol

[duncan macgregor]

yes he did. he said oil would be at $200 by the end of the year. lol I said the price of oil will get to $200 after the games when China revs up, and assists America to commit financial suicide in a peacefull take over to number one spot. I also said that the markets would downtrend leading to a crash after the Olympics. So far NITA 100% correct so dont feel to smug the crash is coming.
Being of sound mind i prefer to watch you lot battle the market from the side lines jumping in for the kill to pick up your bits and peaces. Come to the Auckland meeting and buy me a beer for all the money i might have saved you if you were savvy enough to take heed. Macdunk

[Nitaa]

I said the price of oil will get to $200 after the games when China revs up, and assists America to commit financial suicide in a peacefull take over to number one spot. I also said that the markets would downtrend leading to a crash after the Olympics. So far NITA 100% correct Macdunk I wouldnt say i am 100% correct but thanks for your kind words.

Fundamentals have changed a lot over the past few days. specifically POO and credit crunch starting to bite very quickly with more to come. credit crunch is biting and a lot more to come. i agree its a good tiome to sit on the side line.

i have just looked at the balance sheet for ppp and i would say that cash equivilant is about market cap or soon will be oner the next few weeks. a good opportunity for for nzo to buy some of ppp right now

[boysy]

or for PPP to buy into NZO you never know lol

[Crypto Crude]

mackdunk,
you got alot right over the last year... but you also got things wrong too...It would have been a mighty feat on your part had you stood by us and supported our Mighty New Zealand Oil And Gas, and Pike rip it up, instead of ripping them apart...
NZO is a beautiful company...
when are you going to realise this?
:cool:
.^sc

[Crypto Crude]

And, seening yourve been out of the game for abit, if your having any problems redistributing those funds back onto the market, then give your mate Shrewd a PM and I'll help you out...
:cool:
.^sc

[duncan macgregor]

mackdunk,
you got alot right over the last year... but you also got things wrong too...It would have been a mighty feat on your part had you stood by us and supported our Mighty New Zealand Oil And Gas, and Pike rip it up, instead of ripping them apart...
NZO is a beautiful company...
when are you going to realise this?
:cool:
.^sc SHREWDY, Dont fall in love with a bloody company mate. Learn to be objective stand back look at reality in the face. I though you might have learned the reason for your sicknesses since you left home. A great dose of the scratchies is not the end of the world as long as you understand what is going on in the real world, and learn not to get caught out again. Companies are only a means to an end, just like last nights one night stand, learn to move on sometimes faster is best. Your old mate Macdunk

[Crypto Crude]

hahaha mackdunk,
Im not in love with any stock...
I will usually hold until either im proven right, (which sometimes takes times) OR company related information changes material enough to impact on that stock...(so I sell)...
You of all persons should know I dont fall in love with any stock, especailly after my little stint with little norwest (your favourite)...
anyway thanks for your adivce.... I will take it onboard...
later you big cat...
:cool:
.^sc

[Sehnsucht888]

Oil rebounded more than US$3 a barrel on Wednesday, after two days of free fall, as an $85 billion bailout of American International Group sparked a relief rally on Wall Street.

http://www.nzx.com/news/4696132

Sounds promising...

[trackers]

Oil rebounded more than US$3 a barrel on Wednesday, after two days of free fall, as an $85 billion bailout of American International Group sparked a relief rally on Wall Street.

http://www.nzx.com/news/4696132

Sounds promising...

Does indeed...Couple with the damage we already know about from Ike, the worst fighting in two years is disrupting nigeria production and this bit also very interesting:

"US gasoline stockpiles are already running at their lowest level since November 2000, and could drop to their lowest on record due to the effects of Ike, according to a Reuters poll of analysts. The EIA data are due later on Wednesday."

China will be starting to ramp up consumption as of tomorrow also.

[Casa del Energia]

NZO down to 141c at the moment which hopefully will be a good lesson to take on board about how useless fundamental anaysis is in a down trending market. Its all market sentiment whats love got to do with it. All companies will crap out in a crashing market the wise investor stands aside waiting to pick up the road kill. Think about how much money over the years you might have made with a simple 10% or 15% running stop loss.
Five years ago the sp was in the 130c range with some great rises and falls in between yet the fall in love with a company brigade blind themselves to the harsh reality of how the market works.
The price of oil will nearly double in 2009 so all is not lost macdunk will be waiting to buy your roadkill about then so hang on in the road is about to get much rougher. Macdunk


Alas, despite forcefulness of your argument I still remain a doubter. Road kill is hard to obtain because nobody can remember the future.

As you well know - usually, on average etc. etc. - a well-balanced portfolio will outperform one that is traded with a strategy to avoid market dips and slumps.
Interestingly, there was a study that demonstrates this in that portfolios operated by women outperform those be men - the reason is that men tend to trade too often in an attempt to do the very thing you are advocating - which I interpret as removing money before a dip/slump and re-joining before a bull.

I have an interesting chart pinned to my wall as a reminder of the REAL mechanics at work. It is a chart put out by Grosvenor in 2004 - it shows the comparitive returns of differing investment vehicles over time. One of the lines on the chart is NZ equities from 1970 to 2004. In short, $10,000 placed in 1970 has grown to $736,587 in 2004. (Yes - I had thought about inflation, so 10K in 1970 is equivalent to 120K in adjusted money - still, not bad huh?).

I'm sure you already know that length of time in market and risk mitigation are the greatest contributors to portfolio gain - the rest just fiddles at the edges and gains are for the lucky only - why ignore this?

Finally - NZO is an odd case, at least in my portfolio - it is a sideline interest and, yes, a punt. But at least I recognise that and have not predicated the age at which I retire based on how NZO does… but it's a fun stock to have. (I'm over 18 and I can break the 'rules' if I want)

Anyway - that's the Tao of Casa.

[rotweiller]

It is a great sight out of our window at the bright lights of Ensco 107 and her 2 tugs brilliantly lit up while moored close in in Tasman Bay. Apparently sheltering from weather whilst inbetween drills at Taranaki - presumably Maari.
Is the correct Oiler?
Nelson seeing quite a bit of drill activity of late and looking good for servicing matters.
Cheers

[Grand Uber]

http://www.stuff.co.nz/dominionpost/4693783a6034.html

Basin excites oil officials
By JAMES WEIR - The Dominion Post | Tuesday, 16 September 2008


The Raukumara basin off the North Island's East Coast is looking "very useful" and may encourage European oil giants to have a second look at New Zealand, according to Associate Energy Minster Harry Duynhoven.


New Zealand would depend on oil for some time and significant opportunities existed for the oil sector with the Raukumara basin the next to be opened for exploration, Mr Duynhoven told an Energy Summit conference in Wellington yesterday.

Raukumara was interesting and had the potential to be very productive, he said, though he would not give an estimate of its potential.

"The officials are very excited by it and these are not easy people to excite."

Crown Mineral papers suggested the basin could hold possible reserves of billions of barrels of oil.

GNS exploration geophysicist Chris Uruski said of Raukumara: "There could be about 50 billion barrels."

International oil prices are down to a six-month low of just under US$100 a barrel. The price is down about a third on the recent peak of US$147 a barrel in July.

Mr Duynhoven said the offer to get exploration work proposals for Raukumara was expected to be made to the exploration industry in the next few months, possibly slipping into January or February next year, if a new government had a stock take.

A couple of European major oil companies were interested in the Great South Basin off the South Island and may return for another look at Raukumara, which had shallower water.

"It is looking very good from the type of geology expected, given the seismic done so far and the indications it should be a very productive area."

Mr Duynhoven said the oil sector was particularly buoyant, with four big projects at or near fruition.

The Tui and Pohokura fields were in production and Kupe and Maari were due to start producing soon.

Peak production from the fields was expected in 2010 and the fields would add about 140 million barrels of new reserves.

Exploration continued in the Great South Basin and work proposed in the first five years was expected to be worth $1.2 billion, Mr Duynhoven said.

American oil giant Exxon Mobil and Austria's OMV were exploring the Great South Basin, and a decision on drilling was expected in 2010.

[Sehnsucht888]

West Texas up almost $6 this morning. Based on recent price reaction, if it stays like this NZO should close up 7 or 8 c

[Corporate]

West Texas up almost $6 this morning. Based on recent price reaction, if it stays like this NZO should close up 7 or 8 c

Yeah we may have seen the bottom for oil. China's about to turn the tap back on

[Rabbi]

PRICE*CHANGE% CHANGETIME Nymex Crude Future96.955.806.3615:08 Dated Brent Spot92.763.233.6115:37 WTI Cushing Spot96.104.955.4314:07
Oil back in favour, at least for today.

Also natural gas on the rebound.

`Commodities have come off so far that if you want exposure it's a good time to get back in,'' said Chris Jarvis (http://search.bloomberg.com/search?q=Chris+Jarvis&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1), president of Caprock Risk Management in Hampton Falls, New Hampshire. ``I expect natural gas to be a leader.'' Natural gas for October delivery gained 62.6 cents, or 8.6 percent, to $7.905 per million British thermal units at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. A settlement at that price would represent the biggest one-day gain since rising 8.9 percent on Jan. 19, 2007.
A decline in gas output from the Gulf of Mexico caused by the hurricanes has slowed the rebuilding of stockpiles for the cold-weather season, Jarvis said.

[dsurf]

Macd pick up some nzo roadkill this morning - & you get a 5c discount - with revenues set to double when poo = $200. Fantastic buy.

[Bilo]

Check out the NTA on the details section
If only the share price reflected the asset backing;)

[Anubis]

It seems to be a worldwide phenomenon:

Surgutneftegaz, one of the largest companies in Russia, was trading Wednesday at just over the value of the cash in its bank account, meaning investors valued its vast oil fields, thousands of employees and other assets as nearly worthless. - International Herald Tribune

The markets are reaching hysterical levels in the way they're swinging around now. Investors are jumping out of stocks and into gold today... who knows what they're going to be doing tomorrow! And meanwhile you can buy shares at the value of cash in the bank, getting all the oil and gas (and coal) for practically nothing...

[remy]

wow all comodities took a big jump this morning, look at gold :eek:

oil up $5.90 nzo down 2c hmmmm i was expecting to see at least a 5c increase this morning regardless of what happened to the dj

[Juggernaut]

Is someone able to post an updated chart for NZO

[trackers]

wow all comodities took a big jump this morning, look at gold :eek:

oil up $5.90 nzo down 2c hmmmm i was expecting to see at least a 5c increase this morning regardless of what happened to the dj

Yip, really disappointing after the strength seen in commodities..Will we see a flock to oil? Will it cruise back over $100? Will NZO reap the benefits of this?

Yes, Yes and Should do... but not sure....imho. What a week to forget.

[dsurf]

It seems to be a worldwide phenomenon:

Surgutneftegaz, one of the largest companies in Russia, was trading Wednesday at just over the value of the cash in its bank account, meaning investors valued its vast oil fields, thousands of employees and other assets as nearly worthless. - International Herald Tribune

The markets are reaching hysterical levels in the way they're swinging around now. Investors are jumping out of stocks and into gold today... who knows what they're going to be doing tomorrow! And meanwhile you can buy shares at the value of cash in the bank, getting all the oil and gas (and coal) for practically nothing...

It could be one of the new financial paradigms the CNBC talking heads are suggesting will fill the void of leveraged credit. I am going to call it -ve inflation, ie, cash loses value since demand becomes so low that prices fall since supply is so great so less money is needed to buy anything. (time for a snooze, might dream of a world where goods can only be acquired by bartering)

[Unicorn]

wow all comodities took a big jump this morning, look at gold :eek:

oil up $5.90 nzo down 2c hmmmm i was expecting to see at least a 5c increase this morning regardless of what happened to the dj

A 5c increase due to the price of oil is possible - but then there is a 3c decrease due to the PRC price fall and a 4c decrease due to the general market fall. So the net effect should be another few cents off today.

[Phaedrus]

Here you are Juggernaut. Medium-term trendlines are red and green. Short-term trendlines are magenta and light green. Neither would have you holding NZO just now.
You can see how the On Balance Volume trendlines provide excellent confirmation of shareprice trendline buy/sell signals.

http://h1.ripway.com/Phaedrus/NZO918i.gif

[KiwiBear]

Thanks Phaedrus, I was watching that previous support also as it had formed a classic head'n shoulders pattern!
Whats your next guess of support to drop too then?
My guess around the $1.25 ish previous resistance peak.

[neopole]

while the traders trade in and out, i'll sit back and collect my second divi and look forward to the third...........
once kupe is in full stream, the divi's should increase nicely.
im not even worried about a rising and falling share price anymore......

[Juggernaut]

Here you are Juggernaut. Medium-term trendlines are red and green. Short-term trendlines are magenta and light green. Neither would have you holding NZO just now.
You can see how the On Balance Volume trendlines provide excellent confirmation of shareprice trendline buy/sell signals.

http://h1.ripway.com/Phaedrus/NZO918i.gif

Cheers phaedrus, what programm do you use for charting?

[Phaedrus]

I use MetaStock, but most any charting package can produce simple charts like this one.

[Drone]

I think it is time for a share buyback, any shareholders disagree?

[croesus]

To early Drone... more downside yet.....would rather we were buying back at $1.20 then $1.35......PRC looking shaky.. is it due to general sentiment or are they doing a " Fonterra"

[Drone]

To early Drone... more downside yet.....would rather we were buying back at $1.20 then $1.35......PRC looking shaky.. is it due to general sentiment or are they doing a " Fonterra"

Smallish volume on both PRC and NZO, I think its the smaller punters running for the exits.

[The Plunger]

I can't be bothered to read through the hundreds of pages on this thread, but what are peoples picks for what NZO are going to spend their cash on ????

PPP - unlikely
TAP - perhaps
NXS - friendly merger
IPM/COE - ??
MOG/SER/BAS - very unlikely


My pick is for NZO to take some or all of the 37% of coogee resources that BNB wants to offload.

All IMO.