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San Juan Basin Royalty Trust Message Board

  • zorro_32408 zorro_32408 Oct 12, 2000 8:11 PM Flag

    wall street journal article

     

    thanks for the post on the WSJ article, I
    couldn't find the 10/11 issue here to read it, curious
    since BR just recently issued a PR that indicated they
    were going to crush the Street's EPS estimate for
    3QTR, and there was no mention in the PR of gas
    production problems

    looked back through SJT's Press
    releases for this year at monthly Nat gas production
    levels, and yes, I believe the issues cited in the report
    are natural occuring circumstances for any natural
    gas field, depletion occurs as gas is released from
    the well ... BR is in the business of continually
    drilling to develop more of the reserves in the San Juan
    basin, IMO the reserves there are at least 8 to 10 years
    at current production levels

    the data below
    indicate average gas production for Q1 was 3.52 Mcf, and
    Q2 was 3.70 Mcf, an increase of 5.1% ... with gas
    prices now hitting $5.50 and heading north to $8 this
    winter, IMO Burlington is going to push production to the
    max

    Production month, Gas produced

    Jul
    '00, 3.71 Mcf
    Jun '00, 3.65 Mcf
    May '00, 3.83
    Mcf
    Apr '00, 3.63 Mcf
    Mar '00, 3.48 Mcf
    Feb '00,
    3.56 Mcf
    Jan '00, 3.51 Mcf
    Dec '99, 3.38
    Mcf
    Nov '99, 3.19 Mcf
    Oct '99, 3.38 Mcf
    Sep '99,
    3.23 Mcf
    Aug '99, 3.20 Mcf
    Jul '99, 3.21
    Mcf
    Jun '99, 2.54 Mcf
    May '99, 3.49 Mcf

    I'd be
    interested in any other opinions on the issues posted by the
    WSJ article ... with volume up, it appears we have
    large institutional buying going on, with the rest of
    the market going in the tank this is the safest place
    to be

    good luck

    This topic is deleted.
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    • I like BPT and LRT.

      1. The distribution
      for BPT is very predictable, having fixed costs,
      escalating on an annual basis. Yield seems pretty high, and
      there are some opportunities to trade if you like doing
      that. Occassionally can sell ex-dividend before the
      price goes down, then buy back in after 1-3 weeks when
      the share price tanks. Long life reserves
      (relatively). I'm not talking about holding for 5+ years, just
      hanging on for the dividend, with the expectation that
      the share price will go up, or oil price down til the
      yield gets to about 10%.

      2. LRT also because of
      the high yield. Long life reserves, potential for
      higher production. Like BPT, I plan to hang on til the
      yield goes down...or just happy to stay there like it
      is.

      mjmce

    • Could it be the percentage of "coal seam" gas?
      Coal seam gas has less BTU content is my
      understanding.

      Also, current prices have gone back up is my
      understanding.

      Anyone have knowledgeable info?

    • Here in the NE it was recently announced that a
      company (I forget the name) that was brought in to
      provide competion to National Fuel, our main supplier is
      stopping consumer shipments. Why? No supply. Also, our
      winter has already started cold.

      A friend of
      mine (exploration geologist for
      coastal) assures me
      that there is way more demand than they can service.
      (for gas) My only question is, is SJT locked into
      contract prices? As far as drilling is concerned, more
      companies are picking up their onshore simply
      because
      it's cheaper and envolves less risk.

      As far
      as oil is concerned, I wouldn't bet the farm on a
      high oil price. I worked as a pet.
      engineer in
      Saudi for years. We shut in probably 10 million bpd.
      They could take the price to $10 in a heartbeat. Both
      high and low
      prices are a problem though so look
      forward, I believe, for a trading range of $20-30.


      Paul

      • 1 Reply to pschwart1
      • According to the trustee, the current contract
        between BR and Duke Energy Trading has all of the trust
        gas priced as a function of a monthly price index for
        San Juan gas. They further indicated that the same
        index was used in the recent El Paso Energy Marketing
        contract. Accordingly, the price index used for the vast
        majority of the gas is published by McGraw-Hill in their
        monthly publication "Inside F.E.R.C.'s Gas Marketing
        Report, in the table "Prices of spot Gas Delivered to
        Pipelines, (month) 1 under the listing "El Paso Natural Gas
        Co., San Juan Basin." It looked like this index was
        about $4.45/MCF last week.

        I am somewhat miffed
        at the low gas prices reflected in the most recent
        distribution report. I am seeking a resolution to those
        issues.

        Hope this helps.

    • Excellant post zorro. I am glad you had the
      monthly production numbers handy. I have them someplace
      but my file cabinet (the floor) is overflowing with
      other junk right now. I did look quickly at the numbers
      and came up with a 7.5% peak to peak deviation after
      throwing out the highest and lowest months. So as I said
      in my last post, I don't think a 6% drop for a month
      is anything to worry about unless it continues for
      several months. I posted a while back that I thought the
      reserve life was closer to 20 years and went back and
      started looking at it. I think based on the numbers I see
      you are closer at 8-10 years. Of coarse, that is
      based on lower prices last year. As you may be aware,
      reserve life goes out further with price increases, as
      marginal producers can stay on line longer. Also, new
      drilling can increase field life. So all in all, I think
      the article was just a space filler for them. I will
      continue to watch.

      Good luck to you.

 
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