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PetroKazakhstan Inc. (PKZ) Message Board

  • timothy_nathan timothy_nathan Jan 15, 2004 12:30 AM Flag

    PKZ pipeline question

    I have been looking at this stock as a possible investment. However, I have three concerns ranked in order of significance to me.

    1) PKZ seems well situated with reserves. However, they are exploiting only 50% of these. Their biggest bottleneck seems to be a lack of adequate pipelines. I saw they have plans for at least 5 new pipelines. When might these come on line?

    2)bent crude is at a high price. IT seems likely to fall.

    3)PKZ has run up a lot. Is it getting a little top heavy?

    Does anyone have thoughts?


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    • Tim,
      I will answer some of your questions for you to the best of my ability even though this post is addressed to Zonzulu. I will do this so you won't have to wait til am wondering, Zonzulu doesn't usually post in the pm.
      Here goes:
      First of all I will reiterate what Zonzulu said. Go back & read the last 100 - 1000 post & you'll have more DD than you need to get started as a PKZ shareholder + you'll know alot more about this stock than your broker ever will.
      Bonus tip: Who cares more about your money than you other than your wife? Dump or wean your broker from your investments and become a do it yourselfer if thats at all possible.
      PKZ has some positives, no we have alot of positives but I'll cut to the chase. You see Transportation costs as a negative? We have been lowering the cost of that & continue to do so,the pipelines are a step in that direction. They can take between 3-5 years depending on the distance.
      Instability in FSU countries says your broker?
      Ask him if he's heard of Enron! Kaz. is one of if not the most stable region of all the FSU countries. Their legal system works & not just in favor of the Government of Kaz, it works in favor of justice. Their not going to cut off their nose to spite their face, they need foriegn investors to help grow their economy, thats the hand thats going to feed them.
      I could go on & on but there is something for you to chew on tonight. I'm not the best versed poster here so I will end this now,others will pipe in tommorow to help you answer your ? in more detail.
      I have been in this stock since 1998 and damn glad. Good luck & welcome abord mate! I hope I've help you answer some of your questions.

    • To the next level requires any one or all of the following:

      1. buy out their German partners to get more value out of the KAM pipeline

      2. large new oil discovery ala Nurali or bigger

      3. dividend in view of Bush tax rules favouring dividends

      4. higher production resulting in higher EPS and Cash flow/share

      5. higher value refinery output

      6. Chinese buyout of PKZ or partnership with PKZ

    • Thanks for the post. I don't have a position yet; but I do have a market order in. I am not sure that I am hamlet though. Just cautious. I learned my lessons the last few years: I would like to think. I have my entire portfolio in equities (bonds just aren't an option): 75% conservative and 25 % aggressive. Over the long term equities always win; I will try not to get caught in the hype next time.

      AS for PKZ, I clearly see some positives. Great books, great overhead, great location between europe and china, great business. YOur executives retire rather than get arested. They seem to play as well as to be expected with the governement. Overall the financials look good. As for technicals I reply on my broker. His computer says that with the current volume the trading range is between 18-26.

      The reason for all my questions was that I wanted to get a feeling from people that have had this thing for a while to find out how they feel about managment. AG Edwards is a very cautious brokerage but their reports were that they believe that FSU's expected oil prouduction expectations were overly abitious considering governemental instability, riots, coups, weather, etc.

      You asked what wanted to know. I was just testing my knowledge of the company. On the story side, they are all over the caspean sea region, they have a refinery. THe biggest failing I see is transportation. When I reviewed their latest conference slides, It looked to me that they propose to build a pipeline to the west next and then one into western china. With the Chinease story looking so good. Why not support china now? How long will it take to gear up these pipelines. Is this a 6 month project or a 3 year project. Then again I could be wrong. What are you all looking for to see them get to the next level?

    • Well I hate to pile in on you Tim but, do you have a position in PKZ? What is it that you would like to know about this company?

      It seems you are asking good questions about our company and you are touching on how we relate to the big picture when you refer to OPEC's market share of supply. Pipeline's, decling dollar, etc. you mention ........

      Your psuedo intellectual conversation was entertaining to eavesdrop in on BTW. But, what is it that you want to know?

      This is the par excellance in message boards for good reason. There are many long time shareholders here that have rode the pain, there are many much shorter time shareholders that have also rode the pain. Yeah, this is a lively stock and the obstacle to making money with this company is getting that first position. After you do that and ride the pain with us you will see the opportunity.

      Your trying to ride a roller coaster by watching I suspect and until you get onboard you will not understand what I am saying

      Come aboard Tim and join us on the ride of pain. It is filled with plenty of everything you ever wanted in a company and a stock and investing in us will make you money.

      Read back in the posts on this MB and you will have all the DD material you ever wanted to make your decision to buy. Link's, pdf's, whatever you could imagine needing to invest in PKZ is in our history of post's! If that doesn't go back far enough then go to Raging Bull and you can go back to early 98 at least if you work at it and one thing you will find. A few of us were there then and will stay now!

      Do you have a position?

    • Geez, Timothy, you're like Hamlet, filled with indecision. PKZ is the best or certainly one of the best oil conpanies operating overseas. If you want to stick to the US and Europe, so be it, but you're not going to find a sound company selling at 4-5 times earnings.
      In the final analysis, if you don't understand the company, don't buy the stock but please spare us endless postings about your indecision.
      Don't be a Hamlet, bro.

    • Thanks for all of your input. It was refreshing to get an intellectual discussion on Yahoo. Typically I don't even bother because ther Yahoo boards tend to be filled with high school kids thinking that they can manipulate the market with unsupported hype. Thanks again.


    • I think a dollar crisis refers to a sudden, rapid drop in a currency's value. It's not a drop in value that hurts people but a fast, unexpected, "shock" that can disrupt things and cause excess uncertainty in markets.Almost all asset prices are the same way.

      Inflation, for example, is not a big deal. If we knew that there would be a certain constant level of inflation every year and that it would stay that way then things wouldnt be a big deal. Like I said before, it's these unexpected things that cause problems. The oil price shocks of the 1970s were a good example of an unexpected negative shock to the economy. Shocks can be positive as well.

      Also all this talk about the dollar drop is in nominal terms. Has anyone checked to see if the dollar is dropping in real terms? As an example in real terms oil was much cheaper in the 90s than in the 70s even though in nominal terms it wasnt.

      And when people say the dollar is dropping, what is it dropping against? A basket of foreign currencies, the Euro, the Yen, etc? Certainly the dollar has not dropped in nominal terms against the Yen or the Yuan (reminbi) at all but has fallen, in nominal and probably real, terms against the Euro. I could name half a dozen countries whose currencies have fallen against the dollar recently as well as countries that have risen against the dollar.

      The point of all this is that when the media talks of dollar drop this or currency crisis that or whatever they usually don't know what the heck they are talking about.

      Ohh whatever. I don't even know I started writing this email. Can one of the Germans or French (do we have any of those here) members of this board send me a nice absinthe in the mail if I paypall you the money? An emile or pernot porfavor?

    • What is this CAII that owns 19%? Is this a foreign partnership of some sort?


    • whats a "dollar crisis"?? Must be new buzzwords analysts invented. There is no such thing as a correct value of dollar or correct value of oil or anything else. The market determines what the right value is. Right now, the market is saying - dollar is too expensive. And market is always right. The government doesnt dictate what is correct price of anything, remember in Argentina there was strong currency policy, it was pegged to US dollar, we know what happened.

      Dollar will keep falling for a long time, thats a certainty. Good thing that PKZ is a canadian company earning canadian dollars not green ones.

    • It seems to me a weak dollar is the unspoken policy of the Bush administration.
      The recent rise of dollar is a result of (a) EU concern of strong EURO and threat of lowering their interest rates. (b) the seemingly strong recovery of US economy with narrowing trade deficit.
      However, as long as Mr. Bush is in power, I would expect the dollar to futher drop.

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