Touchstone Exploration Share Discussion Threads

[mount teide] 04/7/2018 22:43

Negative or alternative views supported by well reasoned argument should always be welcomed.

The collective wisdom of an investment community is usually far greater than the sum of its parts.

[captainfatcat] 04/7/2018 22:28

I have often thought the best way to make a profit from trading is first looking at how much I can lose and how quickly that can happen.


We all like to win and have a mulitibagger or two but the real trick seems to me to be effectively managing the downside risk.

TXP looks well positioned at its current market capitalization to benefit from a compelling upside potential while the downside one could almost considered as ring fenced with its producing assets spread across many fields. However I am mindful that the area is prone to earth quakes which could certainly impact production and a 5.3 earthquake was recorded near Trinidad and Tobago as recently as last Friday night.

[fardels bear] 04/7/2018 22:05

In my experience you manage to put a negative slant on every board I read that you post on.Just sayin' like.

[fardels bear] 04/7/2018 21:37

Well, Zen.. I think we all know what attracted Debbie to the millionaire Paul Daniels, but for the life of me I have no idea what attracted ross to oil stocks.

[captainfatcat] 04/7/2018 20:40

Rossannan I am fond of the saying "there are lies, damn lies, and then statistics"

[zengas] 04/7/2018 20:20

As Mrs Merton would say, what actually attracted you to oil and gas stocks ross ?

[2prsimo] 04/7/2018 18:32

Excellent post MT

[mount teide] 04/7/2018 17:56

Ross - the astonishing debt levels of some of the US's greatest stockmarket titans, who have all recently announced large share-back programmes rather than pay down debt. Makes you wonder what they know?


Cisco: Cash and cash equivalents - $7bn, Debt $28bn
Pepsi: Cash and cash equivalents - $13bn, Debt $43bn
Oracle: Cash and cash equivalents - $22bn, Debt $60bn
AmGen: Cash and cash equivalents - $10bn, Debt $35bn
eBay: Cash and cash equivalents - $3bn, Debt $9.2bn
Mondelez: Cash and cash equivalents - $1bn, Debt $19bn
Lowe’s: Cash and cash equivalents - $2bn, Debt $16bn
Visa: Cash and cash equivalents - $8bn, Debt $17bn

Source; JTC


They would surely be aghast that economist by training Paul Baay would use TXP's cash to fund an accelerated programme of production development and ultra high impact exploration drilling in a strong and rising oil price environment rather than use it 'wisely' for share buy-backs or perish the thought, to pay down debt!

[mount teide] 04/7/2018 17:32

ross - Similar to Science Direct, I've found little evidence to suggest that a slowdown in the oil consumption growth of Opec Nation's to that of the West is likely anytime soon - principally imo because many Opec Nations's still have a very small wealthy elite and large impoverished populations.

Take Opec giant Saudi Arabia for example.

Saudi Oil consumption growth over the last thirty years:
+44.3% - 1988-1997
+68.5% - 1998-2007
+62.7% - 2008-2017

By way of comparison the UK's oil consumption dropped 8% between 1990 and 2017 from 82.9 metric tonnes to 76.3.

[mount teide] 04/7/2018 16:52

ross - there has been a significant number of economic downturns since 1970 - yet Opec's consumption still averaged 5.1% growth over the 40 odd years since - more than double the global growth in oil consumption.

[mount teide] 04/7/2018 15:58

One of the supply challenges the global oil industry continues to face is that OPEC′s domestic oil consumption has increased seven-fold in 40 years,(since 1971: 5.1% annually) to over 9.0 million bpd. They consume almost 80% as much oil as China, whose demand also continues to grow close to 5% annually.

This means over the last 40 years OPEC′s energy and oil consumption has grown as rapidly as their income. Consensus projections (IEA, DOE/EIA) have consistently under projected OPEC and Chinese consumption.

Opec consumption now constitutes nearly 30% of their production. Such rapid growth in consumption, will challenge OPEC′s ability to increase their oil exports, which are relied upon in long-term world oil projections by the International Energy Agency (IEA), US Department of Energy (DOE/EIA) and British Petroleum (BP). However, these institutions assume unprecedented slowdowns in OPEC oil consumption – to less than 2% in the future – allowing them to project increases in OPEC oil exports with only modest increases in production.

ScienceDirect analysed 1971–2010 Opec data econometrically, with panel co-integration methods. They estimate that the income elasticity of consumption is about 1 for energy and oil.

This means that OPEC′s energy and oil consumption is likely to continue to grow as rapidly as their income. Hence, continued high growth rates for domestic oil consumption are more likely than the unprecedented slowdowns projected by IEA, DOE/EIA and BP – adding a likely extra 6m bpd of OPEC consumption by 2030.

This has potentially major implications for OPEC production and export levels, and for world oil prices in the decade ahead.

[futuredlighter] 04/7/2018 15:48

are we expected an update again soon?

[fardels bear] 04/7/2018 14:32

Does it though? Really? Do you have figures to back that up?

[spangle93] 04/7/2018 14:15

Indeed DH - it's the lack of investment that would have spent to offset the effects of the natural decline curve.
Plus all non-essential maintenance was put off, so there will be more downtime as this work happens
And who will be available to do the development/maintenance work when many many thousands of operator and contractor staff were, and are being, laid off (invited to pursue new career paths)

[zengas] 04/7/2018 14:12

The world population is growing at a significant rate. Heading for a further 2 billion in the next 20-30 years.

Oil demand is expected to keep rising for the next 20 years regardless of EVs.

Where's all the power going to come from to generate the power for EVs ? It won't and can't all come from the sun or nuclear. Will be a significant demand for gas not only with a rising population but for power generation.

[dunderheed] 04/7/2018 14:02

Not only lack of investment there is the double whammy of natural decline curve really kicking in for a lot of the mid - older range BIG fields - causing a production cliff end 2019 to 2020.

[spangle93] 04/7/2018 13:50

Mount Teide, ref 1914 The huge reduction in capital investment by many National Oil companies and multi nationals during the circa 5 year collapse in POO is now coming home to roost.

Exactly - it's why "lower for longer" could never morph into "lower for ever".