When to buy BP?

[endthefed]

i too have been buying into bp. i'm about 60% of my full position. i'm hoping to catch some in the low forties this coming week.

plug that leak!

 

[Meadbh]

BP's future drilling plans in the Arctic are coming under increasing scrutiny:

BP can't explain how it would clean oil spill in Arctic

 

[endthefed]

the arctic...part of an oil production suppression scheme? lindsay williams claims there is a VAST oil field up there that is being hidden from the public.

check out lindsay williams - the only guy to call for $50 oil when it was $147. people thought he was crazy (me too). until it happened!

he has several videos on youtube, etc.

 

[Meadbh]

the arctic...part of an oil production suppression scheme? lindsay williams claims there is a VAST oil field up there that is being hidden from the public.

check out lindsay williams - the only guy to call for $50 oil when it was $147. people thought he was crazy (me too). until it happened!

he has several videos on youtube, etc.

The Arctic oilfield is not being "hidden from the public". It's common knowledge here in Canada that there are huge reserves of oil and gas beneath the Arctic (see this 10 year old story from CBC):

CBC News - Gov't muses on High Arctic oil, gas development

It's just that it's been very difficult to get at through the ice. But with global warming, the Beaufort sea is opening up. This makes it economically viable to explore there. And risky for the environment, too. We need to proceed with caution.

 

[Ed_The_Gypsy]

I more or less reject the zero price idea. Shale gass is not cheap to produce. If a glut does materialize, drilling will go way down and since gas wells in shale have rapid depletion it won't take long for prices to be back to at least somewhat profitable levels for the explorers. Why borrow money to drill a well that you don't expect to create cash flow?

Actually, I have been told that shale gas is cheaper to produce. From what I understand, first, it is easier to find. No more dry holes. Second, drilling takes more capital but fewer people. You are right about the rapid depletion. It seems that this was underestimated in the beginning, but better known now. They are drilling like crazy in northern BC right now. Drilling for conventional natural gas has pretty much stopped in Alberta.

Zero may be an exaggeration, but it gives you an idea of the direction.

 

[ronocnikral]

Actually, I have been told that shale gas is cheaper to produce. From what I understand, first, it is easier to find. No more dry holes. Second, drilling takes more capital but fewer people. You are right about the rapid depletion. It seems that this was underestimated in the beginning, but better known now. They are drilling like crazy in northern BC right now. Drilling for conventional natural gas has pretty much stopped in Alberta.

Zero may be an exaggeration, but it gives you an idea of the direction.

This is interesting, as I have not heard any of this. How can you not have anymore dry holes? How are they drilling with fewer people? My interests have been piqued...

 

[haha]

Actually, I have been told that shale gas is cheaper to produce. From what I understand, first, it is easier to find. No more dry holes. Second, drilling takes more capital but fewer people. You are right about the rapid depletion. It seems that this was underestimated in the beginning, but better known now. They are drilling like crazy in northern BC right now. Drilling for conventional natural gas has pretty much stopped in Alberta.

Zero may be an exaggeration, but it gives you an idea of the direction.

Thanks for the information. On principle I reject arguments that some basic commodity which has had a steep fall based on supply excess will fall forevermore.

It never seems to happen that way. Another thing is the water needs of this type of drilling, and its environmental hazards.

 

[Ed_The_Gypsy]

Another thing is the water needs of this type of drilling, and its environmental hazards.

Yes. That is beginning to surface (pun intended).

This is interesting, as I have not heard any of this. How can you not have anymore dry holes? How are they drilling with fewer people? My interests have been piqued...

I don't know for sure. I guess it is easier to find shale and where there is shale there is gas.

They drill many wells, 20 or so, from one drillsite. They go off laterally in all directions.

If I find an article I will post the link here.

 

[Ed_The_Gypsy]

Here is an intro:
Shale gas - Wikipedia, the free encyclopedia

Google brings up a lot of information. There was a very good article in the Calgary Herald a whi9le back but I couldn't find it again.

 

[ronocnikral]

Yes. That is beginning to surface (pun intended).

I don't know for sure. I guess it is easier to find shale and where there is shale there is gas.

They drill many wells, 20 or so, from one drillsite. They go off laterally in all directions.

If I find an article I will post the link here.

ok...i think i know what your information is intending to say.

i'll throw in my 2 cents, and you can take it or leave it.

no more dry holes. to me, a dry hole can show a resource, but if it is not economic, it is of no use, and therefore a dry hole. an example of this can be a well drilled expecting 100' of reservoir, but only finding 10'. There is still a resource, but it is not worth the money to continue with the completion of the well. I imagine the same is true with shale gas (the little i know about it). not all shales have gas. the primary target are shales known as source rock, which typically provide the hydrocarbons to the conventional reservoirs. further complicating things, water is almost always produced with oil and nat gas. as the wikipedia article points out, shales have very little permeability. but, with the mobilization of some in-situ water, some shales (such as illite and smectite) swell with water, decreasing permeability even further.

lower drilling costs - the idea (and i spoke with a horizontal drilling expert in my group who just attended a shale gas conference, also is mentioned in wikipedia) is to maximize the contact of the "Reservoir" to the wellbore. petroleum engineers typically speak in terms of flow capacity (permeability*height). since shales have virtually no permeability, the only other option is to increase the effective height by drilling horizontal. drilling from pads has been going on for at least a decade and is more or less the norm now, especially in the states. pad drilling can be much more efficient in terms of total operations, but also increases costs in other areas (such as direction drilling systems). especially when you start to talk about long horizontals which can require pilot holes to be drilled. the idea of pad drilling is to keep from having to move the rig miles for each well, instead you can move it 10'. and it keeps the environmental impact down.

my take...dry holes (or not economic holes) will occur with shale gas, they are not risk free. additional work in understanding petroleum systems will need to take place before development. drilling is likely to be more expensive than conventional plays, laying a long horizontal is not common practice nor is it easy. technological advances that can help shale gas plays - geo steering, control of hydraulic fracturing (limited entry, real time monitoring).

random comments - the horizontal drilling guy in my group that i spoke with said the shale gas conference was the first conference he ever attended that was a constant sales pitch to sign up for and pay for newsletters (the guys putting on the conference were trying to sell something other than shale gas). i don't feel the current nat gas price will support shale gas developments, as anything under $6/mcf had marginal economics in the piceance (current prices today definitely are not economic to most in the piceance, as most rigs have been pulled out of the area).

 

[Free To Canoe]

I-80 Gasoline report.
Local BP station has no customers. Other gas stations have yellow bags on their pumps because they ran out of gas from former BP customers. Lots of negativity toward BP up here in land locked, pro business, conservative america.

Thought for the year: BP has alot more down to go before up occurs.

Free to canoe

 

[Ed_The_Gypsy]

I bought some more BP today. Just for fun. The low earnings was some kind of glitch in Yahoo.

 

[Trek]

One might also consider Transocean (RIG) as an alternative. They've lost even more value but don't have the public face of BP.

 

[Zathras]

I-80 Gasoline report.
Local BP station has no customers. Other gas stations have yellow bags on their pumps because they ran out of gas from former BP customers. Lots of negativity toward BP up here in land locked, pro business, conservative america.

Thought for the year: BP has alot more down to go before up occurs.

Free to canoe

The funny/sad/disturbing thing is, BP doesn't own most of the BP stations.
They are loosing nothing, the independent franchisers are.
And regardless of where you buy your gas, BP is likely delivering a portion of it.
If you want to hurt BP in the pocketbook, buy an EV

 

[HFWR]

Just rent a supertanker, and a giant shopvac. All the oil you'll ever need is floating around in the GOM, ready for the taking...

 

[Dawg52]

I bought some more BP today. Just for fun. The low earnings was some kind of glitch in Yahoo.

Good move. Looks like they have plugged the oil leak. Stock up $2.36 this morning.

 

[Zathras]

Just rent a supertanker, and a giant shopvac. All the oil you'll ever need is floating around in the GOM, ready for the taking...

That is the very very sad thing. All of the oil spilled so far doesn't come close to the amount of oil the US uses in one DAY.

 

[ronocnikral]

maybe now is a good time to buy?

i'll pass though. maybe invest a hypothetical $10k when the time is right...

 

[Free To Canoe]

Below $30 per share today. Is now the time to buy?

I would really like to make some money on a stock that has been unfairly beaten down. I need someone to tell me some good things about BP so that I can get on the band wagon.
They bought ARCO years ago. This was a good thing for many reasons. This is why I owned it once upon a time. Now I look at this stock and I see the General Motors of the oil industry.

Free to canoe

 

[Telly]

BP has problems with getting new product to market, on time.

Their "Pre-Fueled Pelicans" product arrived too late, missing the all-important Memorial Day cookout market.

 

[haha]

I think a better question than when to buy BP is "Is buying BP a good idea at any price more than throwaway money a good idea?"

I don't think this questiona can be answered by an outsider, with the needed level of confidence.

So I would pass, and maybe look at other vehicles that have been affected one way or another by BP's problems.

Ha

 

[DeborahB]

Below $30 per share today. Is now the time to buy?

I would really like to make some money on a stock that has been unfairly beaten down. I need someone to tell me some good things about BP so that I can get on the band wagon.
They bought ARCO years ago. This was a good thing for many reasons. This is why I owned it once upon a time. Now I look at this stock and I see the General Motors of the oil industry.

Free to canoe

As of its close today, yielding around 11.5% in dividends. Will it continue?

 

[DblDoc]

below $30 per share today. Is now the time to buy?

I would really like to make some money on a stock that has been unfairly beaten down.

?

What would BP have to do to be "fairly" beaten down

DD

 

[brewer12345]

I think a better question than when to buy BP is "Is buying BP a good idea at any price more than throwaway money a good idea?"

I don't think this questiona can be answered by an outsider, with the needed level of confidence.

So I would pass, and maybe look at other vehicles that have been affected one way or another by BP's problems.

Ha

Look at other E&P companies, would be my suggestion.

I am watching BP bonds. At a distressed price, they would be attractive, IMO. If the company goes into BK, all the civil claims get in line behind the bondholders, AFAIK.

 

[Free To Canoe]

?

What would BP have to do to be "fairly" beaten down

DD

The scenerio could be that an accident happened, much like sometimes a crash happens and the affected airline stock, the company does the right things and a year later, the stock recovers. BP's view of this as a "public relations problem" reveals systemic problems with how their management views the world and solves problems in a favorable manner.

I think a better question than when to buy BP is "Is buying BP a good idea at any price more than throwaway money a good idea?"

I don't think this questiona can be answered by an outsider, with the needed level of confidence.

So I would pass, and maybe look at other vehicles that have been affected one way or another by BP's problems.

Ha

Interesting...

BP has problems with getting new product to market, on time.

Their "Pre-Fueled Pelicans" product arrived too late, missing the all-important Memorial Day cookout market.

Free to canoe