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San Juan Basin Royalty Trust Message Board

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  • birdluck1 birdluck1 Apr 13, 2006 11:06 AM Flag

    What am i missing?????

    SJT is a pure play on the price of NG. The reserves are likely to be far in excess (25+ years) of the estimated 9.5 years ( we know this because the production has not gone down during the last 20 years, and they are drilling lots of new wells on property they already have leased). Since SJT does not use hedges to limit the selling price of NG, the big risk is that we are wrong about the future of NG prices. Those of us who love this stock and intend to hold it till we die believe that NG will never return to the $3-5 range again, with one exception: a flu pandemic, which could cause great demand destruction. Even this would be a temporary effect, with rapid recovery following. Of course in the case of a pandemic, the only safe place for your money is in fixed rate instruments like cds. Check out Mcdep.com for lots more information about NG royalty trusts and the future price of NG.

 
SJT
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