AUT - Aurora Oil and Gas

[Sharejon]

I wouldn't go as far as saying they'd be kicking themselves hard. I mean if they've invested into AUT recently (without a day-trading mentality), then I don't see how you could have made a loss with the stock. Regardless of how much it's gone up since they've sold, they still will have made healthy profits i'm sure.

Personally I lightened my holding last week, as I was looking to free up some funds and I had some doubts over the US economy, but I definitely still retain the majority of my original holdings and am not even considering selling these beasts anytime soon.

AUT and EKA have been part of the backbone to my portfolio since I opened it at the start of the year, and long may it continue.

 

[condog]

Twas a nice new high and i know its sounding a bit like a broke record, but those buy sell ratios and spacing still look very encouraging. Since the traders have been thinned out immensley , sellers are consistently in short supply . Got to say i much prefer it this way with investors in control.

That 1.59 target is getting closer and closer. Euroz and H's will have to put out revised targets soon on the basis of 3 months of thier 6 month target now lying in the window of three rigs and a FT frac crew.

Im seriously tipping SEA as the next one to rerate. Its got all the same writing on the wall imo that AUT had 6 motnhs ago. Its sured up its acerage, its funding and its operator. Both its operators are currently looking at accellerating its program. Sound similar. DYOR definitely.

 

[5haretrader]

this is why you let your winners run, so many have sold out along the way and must be kicking themselves so hard.

Well mate, I don't know about others, but kicking myself is the furthest thing on my mind at the moment. AUT has been a real success story for me this year and I'm also happy for holders that this one is making new highs everyday. Amidst the uncertainty in the world's markets this one keeps on busting out these unstoppable rallies.

Having sold my AUT holdings, I'm now keeping a close eye on SEA which I believe is underappreciated by the market at this point. Other companies on the radar for me are SSN and my roughie is GGE.

 

[condog]

Well i just read tonights installment of the eureka report and ive got to say if those guys are right, which they seem to be more often then they are not, theres several article painting a very rosy picture indeed.

Indicators that make me bullish
By Andrew Switajewski
September 27, 2010



Instead of focusing on popular indicators that “lag”, he concentrates on measures that might be considered by some market commentators to be off the beaten track.

His favoured indicator is the US Federal Reserve survey of credit officers.

To date, he says the media has focused on tightening of balance sheets for banks, however the facts show tightening credit standards moved negative this quarter which in the past creates employment and economic activity.

Another indicator that routinely gets a lot of air time is the Baltic Dry Index. which traditionally is an indicator of the Aussie market, and its up..

Another is the S&P 500 Index & S&P 500 dividend yield – US 10 year Treasury yield This is usually a good contrarian signal to buy the US market. And right now it says buy.


Then we have alan Kohler saying
Australia in a sweet spot


We’re in for a few years of strong GDP growth, shares are looking cheap and there’s barely a cloud to spoil the outlook.


The overnight interest rate swap (OIS) market has now put a 52% chance on a rate hike next month.

Paul Bloxham, had 12 years in the bowels of the Reserve Bank reckons rates will go up 1.25% by the end of next year.

The transition from public to private spending in Australia has been incredibly smooth,

I’m feeling as positive about the Australian economy and sharemarket as I ever have.

The one negative is that the currency

mining companies expect to increase their capital investment by 48% in the year ahead. In a speech last week, Glenn Stevens called this the greatest minerals and energy boom in Australia since the late 19th century.

Paul Bloxham also believes construction, has also bottomed as a share of the economy and will pass previous peak levels in mid-2012, which will make it about 17% of GDP.



He predicts Australian GDP to exceed 6% for at least three years and that as a result Australian shares are very cheap.


Citigroup’s analysts have “bottom up” sales and profit forecasts for the ASX 200 of 8% and 24% respectively for 2010-11 (these are an addition of the individual forecasts for each company from the specialist analysts).

But that’s dominated by mining; for industrials the forecasts are a more subdued 5.5% and 7.5% growth. And that’s where the operating leverage from stronger economic growth can come in.

Stronger-than-expected GDP growth will result in higher sales growth, which will go straight to the bottom line. Yes, costs will also grow but nowhere near as much as sales and, more importantly, the benefits the big cost-cutting programs of the past two years are still flowing through.

In other words Australian companies are entering a sweet spot of rising sales and margin expansion.

It means that Australian shares currently look genuinely cheap

That’s not to say there are no risks;


End quotes

Whats this got to do with AUt, well it may have some bearing on the rerating we are seeing right now.

On the flip side Tom Lovel had an article saying this feels like Jan when we had a 3% rise followed by a 10% fall.

 

[condog]

Interesting article pointing out the reason reliance which is a state owned Indian enterprise is so active accumulating energy worldwide.

Looming crisis
September 27, 2010 5:52:37 PM

The Pioneer Edit Desk

India must secure energy needs

The Oil & Natural Gas Corporation has taken a welcome step in foraying into shale gas exploration. The public-sector energy major has spudded its first well, the RNSG-1, at Ichapur village near Kolkata to assess the potential of a 700-metre thick shale of Permian age. The ONGC plans to drill three more shale gas wells in the Damodar basin in West Bengal and Bihar. However, the programme does not discount the fact that the Government has failed to pursue a sound energy security policy. When neighbouring China was matching steps with developed countries like the US, France, the Netherlands and Canada to explore tomorrow’s most important source of fossil fuel energy, it was yet to catch the imagination of our authorities. By the time we woke up to the reality, finished our deliberations on the potential of such a programme and exchanging notes on formulating a comprehensive shale gas pilot programme, China had moved far ahead. Today, it is producing more shale gas than the US. Even Reliance Industry’s recent interest to buy a stake in Eagle Ford shale gas project, owned by the US-based Chesapeake Energy, should not be viewed just as an effort to expand its businesses beyond petrochemicals, refining, oil and natural gas exploration. The decision highlights the company’s conscious decision to stay competitive in the energy sector because its last natural gas find, the Krishna-Godavari Basin D6, happened some seven years ago.

Even as India is poised for a healthy 8.5 per cent growth, the stark reality of rapidly increasing demand for energy is staring us in the face. And the problem is compounded by the fact that we lack in hydrocarbon resources. What is surprising is that India has failed to exploit its proximity with countries which are treasure troves of hydrocarbons. Qatar, for instance, has the largest availability of natural gas in the world. Uzbekistan and Turkmenistan in Central Asia are also repositories of hydrocarbons. Burma, with whom we share borders and good diplomatic relations, is supplying gas to Thailand. But we have made no arrangements to pipe this gas to our country. In April 2006, China signed a framework agreement with Turkmenistan on constructining a pipeline for long-term gas supply. The inflow of Turkmen gas will significantly help China in meeting its energy demands and stabilising its overall consumption structure. India woke up to such a possibility only last Monday when it signed an initial agreement for laying a pipeline to bring gas from Turkmenistan through Afghanistan and Pakistan. The World Energy Outlook, published by the International Energy Agency, projects that India’s dependence on oil imports will grow to 91.6 per cent by 2020. If we fail to put our act together, we will be left stranded in a seller’s market.

 

[condog]

Well there we have it our almost first real bid at 1.51 and its not even me. Obviously someone wants in onthe open or they are just a tree shaker. No big deal, just a milestone for AUT die hards.

Still plenty of gaps on the sell side and a good 2:1 ratio. No obvious signs of any slowdoan yet.



For the tech heads



Those bolly bands do look mighty wide and they have been there for a while, so perhaps a lot more of this to come ???

You got to remmebr these oilers have been out of favour since 2008, so we have sought of become used to thier relatively low prices, which im guessing have now become noticed by the market, seeking a bit more risk and return. If thats the case we can possibly expect a very significant rerating, based not only on the rerating we thought AUT had to have based on its derisking, but then on top of that possibly a market rerating of oilers in general.

 

[condog]

What a brilliant article highlighting the investment case for companies liek AUT imo

History and Mathematics Make Higher Oil Prices Inevitable

Every week the financial media make a big deal out of reporting the weekly crude oil inventories in the US. Traders will then bid the price of oil up or down based on these reports. The reporting is done with much fanfare from a correspondent who is strategically positioned on floor of the NYMEX to give the whole affair a sense of authority and importance. In fact the whole spectacle is Kabuki Theater unless you are a trader. There is never any discussion or analysis of long term secular demand trends in the emerging markets or what will have to be done on the supply side to accommodate this increased demand. My view is that commodities, and energy in particular, are going to become significantly more expensive and that this represents a huge long term investment theme.

Everybody already knows the story about growth in the emerging markets. We are constantly bombarded with stories about the spending habits of the new Chinese consumer or how many cars were sold in India last quarter. However, what does this really mean with respect to something like oil demand and pricing? Below I show a chart of per capita oil demand use in the United States.




This chart is very illustrative of how oil use progresses as an economy industrializes and transitions from a rural agrarian economy to an urban industrial economy. Oil use leveled out below twenty five barrels per person per year. As a comparison I have next included a graph of Chinese per capita oil use.



It can be plainly seen that per capita Chinese oil demand growth is following the historical example of the US. I am not suggesting that Chinese per capita oil demand will rise to the twenty barrel level of the US. However, the argument can be made that per capita oil demand in China could grow to the level of Japan or South Korea. Japan's per capita consumption of oil is approximately fourteen barrels per person per year and South Korean per capita consumption is sixteen barrels. For the purpose of illustration let us assume that Chinese demand will increase to fifteen barrels per day which would put it in between Japan and South Korea. China's population is a little over 1.3 billion people, so doing the math 1.3 billion times 15 barrels per person per year divided by 365 days, means Chinese oil consumption would grow from the current 7.8 million barrels per day to 53 million barrels per day over the next couple of decades. Let’s now take a look at India and its 1.1. billion people. Current oil consumption per capita in India is .9 barrels per person per day or almost three million barrels per day. Doing the math using the same assumptions that were used in China’s case we arrive at 45 million barrels of oil consumption.




full article at
http://seekingalpha.com/article/227181-history-and-mathematics-make-higher-oil-prices-inevitable

Imagine if chinese demand rises to just 5 barrells let alone 10 or 15 per capita.



Even at 3.5 boppyr thats an extra 1.75 billion barrells of oil required per annum. and if india then grow to 2 bopppyr then thats an additional 1.25 billion barrels p.a. Using crude calcs. those are pretty conservative numbers and they would still have a massive impact on the oil supply demand imbalance imo.

 

[Assasin]

Really injoying the info coming through at the moment, let alone the sp.
Has anyone got a handle on what was going on yesterday with hundreds of trades at such small amounts. Seemed to be just nuisance value.

 

[AngusSmart]

Thats a damn heck of a lot in the oil department. one can see why india is so hungry for resources.. i am not sure of the math above in that example but it seems a bit confusing, maybe its just too early but they dont seem to compare properly with the barrels per day per person, and per year?

Condog, i have been looking into Sea & Ssn for some time, but most research going into Ssn (something for 7c got my attention and also their bank balance after the recent sale.).. i am a bit scared to jump into Ssn dew to them not quiet meeting the mark when drilling holes and having problems with the frac. if they could get Chesapeake on board for their jv partner things would be probably alot better.

I've not quiet looked so much into Sea, but how would they compare to Aut and Eka??

 

[basilio]

What a brilliant article highlighting the investment case for companies liek AUT imo

History and Mathematics Make Higher Oil Prices Inevitable

Yes very cogent story Coondog. Just totally terrifying in terms of the implications for the rest of our civilization.

The story highlights our current dependence on fossil fuels and the explosion of demand that India and China will add to the mix. On the supply side there is the certainty that current oil supplies will deplete and probably very rapidly.

And what will replace these supplies and attempt to meet the projected Chindia demand ? Lille ol AUT ? Give it a break..

Certainly the price of oil could go up with the demand/supply conflict. But another likely result is simply a large breakdown of our whole industrial society as this unresolvable problem becomes clearer.

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My "hope" is that LNC and similar companies get UCG/GTL processes in place very quickly and that we also find non fossil fuel based energy sources to replace our dependence on what can only be a short term solution.

But of course the spectacular success of AUT is still worth celebrating - particularly if one can enjoy the rewards.

 

[Assasin]

Yes very cogent story Coondog. Just totally terrifying in terms of the implications for the rest of our civilization.

The story highlights our current dependence on fossil fuels and the explosion of demand that India and China will add to the mix. On the supply side there is the certainty that current oil supplies will deplete and probably very rapidly.

And what will replace these supplies and attempt to meet the projected Chindia demand ? Lille ol AUT ? Give it a break..

Certainly the price of oil could go up with the demand/supply conflict. But another likely result is simply a large breakdown of our whole industrial society as this unresolvable problem becomes clearer.

-----------------------------------------------------------------------------

My "hope" is that LNC and similar companies get UCG/GTL processes in place very quickly and that we also find non fossil fuel based energy sources to replace our dependence on what can only be a short term solution.

But of course the spectacular success of AUT is still worth celebrating - particularly if one can enjoy the rewards.

Basilio, lets hope not too many fossil fuels are used in the search to get your UCG/GTL processes in place. I wonder how much oil is consumed to create 1 windfarm.

 

[ParleVouFrancois]

I do think that this thread is getting a bit off topic with the last few comments, lets try to keep this thread on discussing the events of AUT. If you want to discuss global warming/resource depletion with people of this forum, start a thread under General, thanks.

 

[UBIQUITOUS]

On the supply side there is the certainty that current oil supplies will deplete and probably very rapidly.


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Which theory is that? Because Peak Oil theory suggest that we have 200 years worth after we the supply/demand curve changes any day now.

http://en.wikipedia.org/wiki/Peak_oil

 

[ParleVouFrancois]

I'm of the view that alternate sources of oil will be enough to tide humanity over until we find renewable energy sufficient. There still is those massive deposits of oil in Canada the oil shales? Also as we develop more technology it won't really matter about oil in the long run. As soon as it's financially feasible to have solar/wind/geothermal/wave power, either through an increase in efficiency of the technologies themselves, or an increase in the oil price which makes them viable, we'll switch over to these sources of power. The world tends to have a bad habit of never really ending.

 

[Assasin]

I do think that this thread is getting a bit off topic with the last few comments, lets try to keep this thread on discussing the events of AUT. If you want to discuss global warming/resource depletion with people of this forum, start a thread under General, thanks.

I'm of the view that alternate sources of oil will be enough to tide humanity over until we find renewable energy sufficient. There still is those massive deposits of oil in Canada the oil shales? Also as we develop more technology it won't really matter about oil in the long run. As soon as it's financially feasible to have solar/wind/geothermal/wave power, either through an increase in efficiency of the technologies themselves, or an increase in the oil price which makes them viable, we'll switch over to these sources of power. The world tends to have a bad habit of never really ending.

Hey frenchy didn't you want to keep this thread on track? No harm done.

 

[ParleVouFrancois]

Haha well I initially said that, but as they continued I thought I may as well weigh in with an economics based point of view, instead of the "oh my god we are going to run out of oil in 10 years!!!" that usually occurs.

Anyways, no more responses to anything off topic in this thread from me, s'all about AUT AUT AUT.

 

[condog]

Which theory is that? Because Peak Oil theory suggest that we have 200 years worth after we the supply/demand curve changes any day now.

http://en.wikipedia.org/wiki/Peak_oil

I suggest some more reading, thats a niave viewpoint given the content of this thread and th econtent of the media on peak, oil, With germany, Australi and the Us military all reporting imminent peak oil concerns.

 

[condog]

I've not quiet looked so much into Sea, but how would they compare to Aut and Eka??

I rode SEA the last few days for $5300 gross profit, and unfortuantely had to sell, to protect a tax bill liability. Its got legs imo, hasnt even broken out of its trend channel yet imo.

Time will tell. But DYOR. Pitty you didnt buy it yesterday, i tried to hint without being slapped for cross promotion.

this is where in my opinion it pays to watch a few stocks closely rather then many poorly. I saw the imbalance occuring yesterday it was standing out like you know whatsies.

 

[condog]

U.S. Onshore Bodes Well
By Zacks Investment Research|Sep 27, 2010, 1:32 PM|Author's Website

Though the U.S. land rig counts fell slightly last week, we continue to believe that onshore market will outperform offshore in the near term. The weekly (09.24.2010) release on rig counts from Baker Hughes Inc. (BHI) showed that the U.S. land rig counts were down by 5 to 1635 from the previous week (09.17.2010).

The onshore-weighted companies will likely continue to enjoy the same favorable situation as they experienced in the second quarter driven by the deepwater moratorium through the end of November.

We believe that the companies with maximum exposure in shale plays such as Bakken and Eagle Ford will benefit more due to oil-centric drilling activity. Liquid drilling activity has been gaining momentum as is indicated by the increasing trend in rig counts. Last week, oil rig count increased by 3 to 673 in the U.S.


http://wallstreetpit.com/45950-u-s-onshore-bodes-well


Also worth a read, but extrapolate the meaning onto AUT imo.
http://www.streetauthority.com/a/how-profit-north-americas-new-oil-boom-456595

 

[ParleVouFrancois]

Haha condog so it was you who made me research SEA, I remember reading about it somewhere so I did my research and swapped out AUT for SEA this morning, with great results. Thanks for your "hint" . I might swap back into AUT at some point as both are undervalued, but AUT is definitely not worth 4.5 times SEA (the ratio of their market caps). So either AUT is too high (I doubt it, still undervalued) or SEA is an even better buy!! Anyway soz for OT (seems to be alot of that by me on this thread). Just wanted to say thanks condog.