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San Juan Basin Royalty Trust Message Board

  • egblack447 egblack447 Sep 25, 2000 6:19 PM Flag

    It seems strange

    that this trust is up so much in light of the
    news regarding the release from the strategic
    petroleum reserve. I'm in 2 other trusts where the same
    thing has happened: SBR and LRT. I've heard a few
    explanations concerning why this may be: OPEC will take the
    same or more volume off the market as they may feel
    we've breched representations we made when we set it
    up, 2)it's too little to make any long term
    difference, 3) we have no additional transportation, storage
    and refining capacity anyhow, and 4) the oil
    companies will not want the oil because they'd rather deal
    with private parties than the government. Any
    thoughts?

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • I am sure you are right. I must admit that the
      information that I wrote about was from memory and quite old.
      It may be that when I read it some years ago (more
      than 10) it was a theory and not fact. Memory does
      strange things. I was born and raised in W.Va. A short
      distance from our house was a coal mine. This was in the
      late 30's and being a normal boy I decided to sneak
      down into tht mine along with a friend. That was my
      one and only venture into the coal business. I made
      up my mind then and there that I would find some
      other way to make my living. I have a great respect for
      those men, but it was not for me.
      Thanks again for
      the informative lesson's on the present state of the
      coal/energy generation business.

      Good furtune to you.

    • For the clear explanation. Really, I have traded
      these trusts my whole investment lifetime, or at least
      since this and Permian were spun off from Southland in
      the early eighties. At this time though,(barring a
      huge runup), I plan to stay. Just don't like to pay
      taxes.( Now that is an unusual sentiment, no?)

    • My background is coal. However, it is my
      understanding that oil fired utilities use number one or number
      two and sometimes inferior products that have seen
      little or no refinement. I have heard that in earlier
      times, some of the oil was so "crude" that it was more
      solid than liquid and had to be heated to be pumped
      from the ships into storage and into the plant.


      Yes, coal, oil and NG power plants (not gas turbines)
      are used to raise steam, which in turn is used to
      turn a steam turbine connected to a generator set.
      Obviously, the firebox design is critical to the operation
      of the steam boiler, but gaining access to these
      fuels and having an on-site storage and delivery system
      is also a major consideration. Pollution control
      systems would be another concern.

      I am fairly new
      to O & G royalty trusts, having just recently
      retired. And I have a debt of gratitude to pay to the
      knowledgeable investors on the various boards who have helped
      me understand this investment vehicle and to profit
      from it handsomely. Sounds like you are a "lifer" with
      SJT. Regards.

    • nomowk...I don't think your information about
      sites in W. Va. is correct. At the moment I cannot
      think of one mine-mouth-coal fired power plant in W.
      Va, except for possibly Allegheny Power's Harrison
      station, which takes most of its coal by conveyor belt
      from CNX's Robinson Run Mine. There may be others but
      I don't think so. Someone correct me. I can say
      that CNX at its Loveridge Mine (now idle after a fire)
      did prove out a hydraulic slurry system for moving
      the coal from the mine to the surface, where it
      entered the cleaning plant. However, the slurry in this
      application was made up of chunks of coal much larger than
      what is used in a slurry fired coal burner. That
      slurry transport system operated for a couple of years
      before it was taken out of service.

      Years
      earlier, CNX developed and put into service a coal slurry
      transport system over 100 miles long from its Georgetown
      Prep Plant to one of Cleveland Electric Utility (now
      combined with Toledo Edison) Power Plants to deliver the
      mines output to this customer as a reaction to
      reluctance by the railroads to make up a more efficient
      method of rail transportation. The net result of that
      effort was the initiation of "unit trains" for coal
      hauling. Soon as the railroad capitulated, the slurry
      system was taken out of service and only removed from
      the ground in recent years. As an aside: I believe
      Peabody still uses the CNX technology in Arizona for
      transport of coal from one its surface mines to a power
      plant.

      Back to the slurry fired systems, my memory is (which
      I confessed was somewhat dim) that the slurry fired
      systems were proven out in Florida where they have easy
      access to both oil and coal shipments. One or more of
      those units may still retain the capability or even use
      it. But I think you are mistaken about W. Va. Of
      course, I am always willing to learn something new and
      correct a mistaken impression.

      I spent my career
      in the coal industry, primarily in environmental
      affairs (air pollution mainly) but also strongly involved
      in the Clean Coal R & D efforts of the late 70's and
      80's.

    • Thank you for the very helpful posts. Could I
      summarize what I think you said, and add a question or two,
      in the hopes that you wil clarify my
      mis-understandings? ONE: do oil generation plants burn unrefined
      crude? TWO: Can they burn heavy oil? THREE:Is this heat
      used to create steam, which then runs the generator
      turbines?
      FOUR: Other than gas turbine generation, which I
      supposed would have to dedicated to NG, or even more
      expensive fuels like jet fuel, or gasified coal- do all the
      other systems use steam to turn a turbine? So the only
      question would be the details of how the firebox is
      designed to burn NG, or crude, or coal?

      As you can
      see, I am poorly informed on this topic. I did
      however, have the good fortune to buy San Juan some years
      ago, at $4.35, after one special dividend. I think it
      was in 1984, if I remember correctly.
      Thanks for
      any help you can give,
      UG

    • Thanks for your input mrdephene. I have no first
      hand information on the subject, and as I said, I am
      an amateur on the subject of power generation, but I
      must inject what I have been led to understand is the
      situration. There are a few (number unknown) generators that
      are persently in operation in W.Va. that use slurry
      to generate power. The generators are built over old
      coal fields and the mines supplying the coal are
      automated with all coal mined turned into slurry and piped
      to the surface and burned on the spot. Slurry also
      lends itself to pipeline thansport the same as oil. I
      personally can't vouch for the truth of these story's only
      that I have been led to believe them to be true by
      knowledgeable(?) people. Please feel free to critique this post
      and correct any and all errors in my assumptions. I
      originally came from that part of the country and used to
      know more of what went on then I do now.

      good
      fortune to you and all others investing in this field.

    • Thanks, I know a lot more than I did a couple of days ago.

    • or does it givin the fact SJT is in NG rather
      than oil and while i agree that there is some relation
      to oil on a BTU basis for natural gas,it seems that
      this historical relationship has parted somewhat due
      to the very tight supplies of NG!!!!

      The
      potential for switching types of fuels is very limited thus
      those who use NG for the most part are stuck in this
      tight supply chain and will have to pony up in order to
      keep running no matter where the price goes!!!!

 
SJT
13.98-0.28(-1.96%)Dec 24 1:00 PMEST

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