For the previous 30 years, 1950-1979, price was steady at about $0.30 - 0.40/gallon before spiking near the end of the 1970s.
In the last five years, the price of gasoline in North America has roughly doubled. This has created some problems for the poor, but for most people it has not caused hardship, and has not significantly affected buying or consumption behaviour. In fact, the inflation-adjusted price in 1998 and 2002 were the lowest since the 1940s. OK, you say, but aren't gasoline prices a component of inflation? That's true, but it's not a major component, and besides, the real inflation rate for the average citizen is way higher than the distorted data the government spins each month. On that basis, gasoline has never been cheaper, inflation-adjusted.

Our problem, as environmentalists have said for years, is not that gasoline prices are too high; it's that they are too low.

Crude oil prices have consistently averaged $20/bbl since 1950, ignoring two major spikes to $60/bbl, the first in 1979-80 and the second since 2003. In real (after-inflation) terms, crude oil prices have consistently fallen since 1950, and have never been lower. No wonder Big Oil is reaping record profits, gouging the consumer a little more each year to keep its shareholders happy with double-digit annual profit growth.

So it's not surprising that, except for the Wal-Martization of the North American economy (offshoring North American jobs and importing cheap Chinese crap to replace the goods once made domestically) to offset the higher costs of energy, $3.50/gallon gasoline has not affected any corporate or individual behaviour.

But suppose it were to double again, to $7/gallon, over the next few years. $20/bbl oil translates to $0.40/gallon gasoline. $40/bbl oil in the 1970s translated to $1.25/gallon gasoline. Now $60/bbl oil is translating to $3.50/gallon gasoline. Do a regression line through these relative rates and we can project the following:

$80/bbl oil will translate to $5.50/gallon gasoline
$100/bbl oil will translate to $8.50/gallon gasoline
$120/bbl oil will translate to $12.50/gallon gasoline
Would we be able to absorb these increases as easily as the increase from 2002's $1.75/gallon to today's $3.50/gallon?

This article (thanks to Craig De Ruisseau for the link) argues that $6/gallon gasoline is just what we need. At first blush, it would seem to be a good idea. But what would its effect be, not just on consumer spending at the pump, but on the entire economy?

Well, for a start, industry won't be able to finance further energy cost increases on the backs of North American (and Chinese) labour. China is running into a wall of skill shortages, massive suffering of its huge underclass, an insatiable demand and skyrocketing cost of all kinds of scarce resources, and environmental devastation on a scale unprecedented in human history. Except for some services, savings from offshoring to cheap nations will be more than offset by the staggering cost of moving raw materials and finished goods back and forth around the globe.

So an increase in oil and gasoline costs will mean an increase in producer costs and hence in consumer costs. No more Wal-Martization room remains. And a jump in consumer costs means a jump in inflation and hence in interest rates.

Now, let's look at what we buy that's made from oil. In this post, I listed the top 10 uses of oil (many are surprised to learn that the cost and energy content of oil used in agriculture exceeds the wholesale price and energy content of the food it produces, thanks to $150B in annual subsidies to Big Agriculture in North America alone). In this post, I listed the average expense budget of a North American household. Putting them together, here's how the average costs of living in North America break down, per $100 in household income:

Expenses heavily dependent on oil: $52

Food $10
Transportation $22
Heating / Air Conditioning $5
Health Costs $4
Clothing $5
Furniture & Home Maintenance $3
Cosmetics & Household Products $3
Expenses dependent on interest rates: Housing $24

Other expenses: $28

Taxes $15
Insurance, Child Care and other service $13
Total expenses per $100 of household income: $104.

Altogether, North Americans now spend $104 for every $100 they earn. Now what will happen if, say, oil prices rise to $90/bbl and gasoline prices consequently double to $7/gallon?

Let's assume, conservatively, that a doubling of gasoline prices means just a 50% increase in the $52 of expenses heavily dependent on oil. That would increase average household expenses by 26%. With no room for further cost cutting, producers would pass on their cost increases fully to consumers -- after all, their shareholders expect them to continue their double digit annual profit increases -- the stability of the stock market depends on it.

Obviously, individuals cannot afford to spend $130 ($104 + $26) for every $100 they earn. The overspending in recent years has been made possible only by a sea of irresponsibly-granted consumer credit secured by overheated house prices. It can't continue when house prices are falling, and when essential living expenses jump 26%, demand for houses, and house prices, will plummet, meaning credit will be reined in, further reducing consumers' ability to pay these increased costs. If you've been following the news, this has already begun, and a bunch of the more reckless lenders are teetering on the edge of collapse as bad debts soar.

Wage demands will soar as workers insist on earning enough to provide for their families. We saw this in the 1970s, as costs of living jumped sharply. What happened next? Inflation, fueled by rising costs and wages. And then, a spike in interest rates, which more than doubled in two years in the late 1970s, to the 15% range.

If inflation jumps to double digits (to reflect the 26% increase in costs), interest rates will go higher than that, since investors need to earn more than inflation just to break even. Anyone remember what 15% interest rates did to the housing market in the early 1980s? Inflation and interest rate jumps will further erode house prices and will double the cost of mortgages as they come up for renewal (and immediately for variable-rate mortgages). So now the $24 housing cost per $100 of household income becomes $48.

I think you get the idea. Consumers will have no choice but to buy much less. Corporate profits will plummet. The stock market will do likewise. Foreclosures, already jumping by leaps and bounds, will soar. Fortunes made in real estate and the stock market will vanish, along with the entire net worth of most North Americans.

And the interest rate on the US government's staggering debt, and more staggering trade deficit, will become crushing.

The bottom line is that, while $3.50/gallon gasoline was a cakewalk (just a catch-up after decades of after-inflation price decreases), $7/gallon gasoline will be nightmarish. Not because we can't afford to pay $140 to fill our gas tank, but because we can't afford to pay twice as much for the oil we eat, the oil we wear, the oil that drives our entire economy. And our economy is stretched so tight, and is so over-extended and over-leveraged, we have no room to manoeuver.

This is the incredible bind we've gotten ourselves into: Coping with global warming and the End of Oil (before the nightmare outlined in The Long Emergency befalls us) demands a large increase is the price of energy to dampen our appetite for it. But that large increase could easily plunge the world into another Great Depression.

There is no way out of this mess. This is what happens when you crank economic systems to their fragile limit and find yourself with no resilience, no room to maneuver. A responsible response would be to own up to our recklessness, launch a major austerity and conservation program (including limiting corporate mark-ups and ROIs to levels commensurate with risk), and invest mightily in public transportation and renewable energy. The Bush & Harper doctrine is instead to publicly deny global warming and Peak Oil, privately acknowledge we're ****ed, and shove the whole massive problem into the laps of future generations.

So the real problem is not that gasoline prices are too high, or that they are too low, it's that we think the price of gasoline is the real problem, and that changing that price will solve it.

http://blogs.salon.com/0002007/2007/05/23.html#a1873

IMO the only hope is if someone gets interested in the platinum property.And not much chance of that this year.

PFM
It is now clear in retrospect that PFM already had the conversion to an oil sand producer in mind before mid-2006. It had developed a portion of its conventional oil and gas holdings to the point that they could be very profitably sold ( approx 1/2 were sold for $8 million in early 2007 ) .It had also hired a top-notch engineering firm to identify, from geological mapping and offsetting well logs, the choicest oil sands, and using this information , it made its bids which turned out to be very successful.

That same engineering also provided a commissioned report in which estimates of the oil in place was provided, along with a test well design to add the necessary statistical confidence to the estimates and to bring them to 51-101 compliancy.
By August 2006, PFM had began the process of changing its BOD.... a clear signal that many of us failed to read.

At the same Land Sale, STP also acquired some choice oil sand leases, which subsequent test wells have shown to be quite thick.

It is noteworthy how fast such oil sands can be converted to 2P oil resources. STP began its test well drilling in mid-Dec/06 and just 6 weeks later, it provided updated resource levels for its initial 7000 acres.
The updated estimates varied little from the earlier estimates, a fact that has already been reported on this BB ( primary data sources , aided by seismics , provide sufficient stratigraphic profiles of oil sands ,such that test well drilling can be conducted with great certainty as to the results ).

And so, in 2007, we are seeing a few more juniors converting to oil sands.
There still arnt many to choose from, which is why the better ones ( BCF, STP and PFM ) have been making smart strides of late.

PFM still has the greatest leverage of any, and with an asset development play, that should be a critical variable in your investment decision.

Why is PFM so well leveraged ?

....PFM has existing oil and gas production sufficient to pay its annual G & A expenses for years to come

....., it has considerably lessened the need to dilute its equity by selling some of its conventional production,

.... its oil sands are located near existing infrastructure amongst existing oil sand development projects located in the Athabaska oil sands, which are the thickest in North America ( followed by Cold Lake and Peace River )

...it has accumulated a significant oil sand land base ( 100 % of 26,000 acres versus 80 % of 16,000 acres for STP ) and will add to that land base in the very near future

....first estimates of its oil in place of 1.15 billion barrels, for just the first 14,800 acres , places it amongst near the top re bitumen density

....its oil sands are contiguous, which makes their takeover/development more attractive

...its oil sands are adjacent to those in which very high oil recoveries of bitumen in place ( 50-60 % ) have been achieved

.....it can sell its remaining conventional oil and gas assets, thereby further reducing the need for equity dilution

....it has not yet been pro-active in providing the stock with promotional/investor exposure activites. Those should further boost its share price, with consequent reduced need for equity dilution.

....it has bid on several attractive oil concessions in East Africa and if successful, PFM could develop an international asset profile that will heighten its attractiveness amongst investors

PFM is still below the radar of most investors. Its oil sand asset base is already very substantial at 1.15 billion barrels, and that estimate is likley to double or more, when its full oil sand holdings ( existing and soon to be added ) are fully mensurated.

PBG just paid $1.45 per recoverable barrel in the ground for the remaining 16 % of whitesands that it did not already own.

As we have already seen, PFM's bitumen is much thicker than that of PBG and might therefore be assigned an even higher price for its oil in the ground.
With up to 600 million barrels of recoverable oil in just a portion of its existing oil sand leases, a look-ahead to 2008 suggests that PFM is a superb asset development play that offers multiples of upside from current levels.

South Korea takes oilsands step
Pays $310-million for Newmont Mining leases
Jon Harding, Financial Post
Published: Tuesday, July 25, 2006

CALGARY - South Korea, long-rumoured to be interested in acquiring a stake in Alberta's oilsands, took a tentative step into the sector yesterday by paying $310-million for leases owned by U.S. gold mining giant Newmont Mining Corp.

The investment by the world's fourth-largest oil importer, while relatively small, mirrors the arrival last year of several state-controlled Chinese companies, which made a handful of deals viewed to be as much about learning as about securing large volumes of oil.

At a signing ceremony in Seoul, state-controlled Korea National Oil Corp. said it's buying 100% of Newmont's BlackGold project -- roughly 9,600 acres of property about 200 kilometres south of Fort McMurray in northeastern Alberta, where a cluster of companies produce oilsands crude using thermal recovery methods.

"It's difficult to assess truly what these state-controlled companies from China and Asia are interested in," said Andrew Boland, research director at Peters & Co. in Calgary.

"Japan, through Japan National Oil Company, has been involved in the oilsands for more than 20 years and never done anything with it," he said.

"China, for all of its large investments going on around the world, what they've done so far in Canada is pretty Mickey Mouse.

"Our understanding for the Chinese is they just like to be on top of any technology being developed -- so maybe that's what South Korea wants, and maybe it's all Japan will ever want."

A comparable transaction was the deal in April, 2005, between Chinese National Offshore Oil Company Ltd. (CNOOC Ltd.) and oilsands startup MEG Energy Inc., in which the state-controlled Chinese company acquired a 17% interest in MEG's thermal oilsands project for $150-million.

While CNOOC Ltd. paid about 45 cents per resource barrel, Korea National Oil Corp. is paying a little more than double that, or $1.10 per resource barrel, according to Peters & Co.

A statement from South Korea's Ministry of Commerce, Industry and Energy said the BlackGold property will produce about 35,000 barrels of oil a day after startup in 2010. Project construction would begin in 2008.

On its Web site, Scotia Waterous, which advised on the sale, said the property holds an estimated 305 million barrels of recoverable bitumen.

Oilsands in that part of Athabasca are buried hundreds of metres beneath the surface. Companies produce it using steam-assisted gravity drainage technology, where steam is pumped underground to soften the oilsands, which are then drawn through wells to the surface.

Natural gas is burned to make the steam, which makes the SAGD recovery method more expensive than mining oilsands with trucks and shovels.

"We don't think global oil prices are likely to fall below US$40 per barrel so the oilsands projects will be successful," a South Korean energy ministry official told Reuters.

Denver-based Newmont inherited the BlackGold leases through its 2002 merger with Franco-Nevada Mining Corp. The contiguous property is located just south of the Long Lake project now being built by partners Nexen Inc. and OPTI Canada Inc.

Newmont is a major shareholder in Canadian Oil Sands Trust, investing about US$650 million in Canada's largest energy trust as of April.

Way too cheap.
Newmont owned 100% of Alberta oil sands lease otherwise known as "Black Gold" project in Alberta, Canada until August 16, 2006. The 9,600 acre lease is located within the Leismer Athabasca Oil Sands Field adjacent to EnCana Resources' Christina Lake Thermal Project and Devon Canada's Jackfish project. All three projects are expected to utilize steam assisted gravity drainage ("SAGD"). After completing a three season resource delineation program, a pre-feasibility study and baseline environmental work, Newmont received a cash offer of approximately $280 million from Korean National Oil Corporation for the Black Gold project. The transaction closed on August 16, 2006 for an approximate $270 million pre-tax gain and was Newmont Capital's first internally generated value realization project

I suspect it will be several years before even a few more of the oilsand companies are producing.There is too much capital and labour required.And I suspect they also need to build refineries to handle heavy oil.
The BQI game may be to prove up a couple of billion barrels and,with a bit more time,sell out to foreigners for 3 or 4 billion.And there will be more share dillution even with that strategy.

I think they are currently buying oilsands for $1 a barrel in the ground.That is way too cheap.Of course they will pay royalties to the Canadian government but oil companies pay royalties everywhere.

GGC.V

Company president Gregory K. Liller states: "I am extremely pleased with the results of the reserve and resource estimates. In four months of effective drill time our reserve base increased 57 per cent, to 6.5 million eAg ounces, measured and indicated ounces grew from nothing to 4.2 million ounces and the inferred resource increased 2.8 times to 143 million ounces.

"Drilling has continued since the beginning of the year and we currently have eight drills on the project. Metallurgical and engineering studies are being carried out by Kappes, Cassiday and Associates which will provide data for mine and plant designs for future production expansion.

"Most importantly, last year's drilling tested less than 5 per cent of the known mineralized structures in the Temascaltepec district. During 2007 we plan on testing the Magdalena Sayas, Purisma, Las Animas and Nazareno areas as well as continuing district-scale exploration activities to define new areas of mineralization."

We seek Safe Harbor.

ncerning your follow-up, you inadvertently left off THE one aspect about PRO that stands out above all the other juniors in the same statistical categories, upcoming revenue. This is so unique I can't overemphasize the advantage this gives PRO. There are many "juniors" out there with a billion dollar cap that will not see revenue of ANY kind for at least 3-4 years and, yet, here we have 35 mill cap PRO with the Cusi deal with Dia Bras that will, without a doubt, be delivering checks to the PRO coffers in less than a year, to be conservative. 3-5 million per year goes a LONG way to keeping dilution down in the critical years of share price and cap appreciation.

And let's not forget many knowledgeable experts in the field of metals see silver with potential massive upside. Based on the 15/1 gold/silver ratio set back in the day, silver today would be looking like $51.00. Of course you can't apply this anymore, but, the point is revenue from Cusi will only increase as silver looks assured in a secular uptrend

My one little addition would be PRO's share ownership going from 0 institutional support less than a year ago to over 60% now and climbing (from reliable source).

Factors for considering PRO:

1) CEO buying at open market recently
2) Production at Cusi receiving revenue, and Cusi production will increase to 500 tpd, and then to 1000 tpd in 2008
3) Excellent potential at Courville with potentail to become a superpit with multiple millions oz of gold (low cost, large tonnage, long life)and with recent drilling results are good
4) Possibly JV with a major on Courville later this year or next year with engineers from majors on site;
5) Excellent potential at Camila/Melina area with multiple metals and super high values.
6) New acquisition near Camila/Milina with great potential
7) New Frankfurt listing to attract European investors
8) Recommended by Jordan Fund and RI, both with high target prices for PRO
9) Recent financing with high warrant price to indicate confidence of the management
10) Exciting new drilling results from Cusi -- discoverying a large silver system
11) JV with DIB on Cusi with DIB paying the bill
12) Excellent management

PRO has four important groups project

Courville Project

the original flagship project. But its importance is decreasing. Not because it is not a good project, or whatever. It is so only because PRO keeps on getting very exciting projects, some of these projects may have more potential than Courville.

The best description of the Courville project is from the Resource Investor article.

“At the company’s Courville project in Quebec, a development program including a first phase of 5,000 meters of drilling, a 43-101, bulk-sampling and additional drilling will look to expand the present known anomaly stretching 1 km long, 200 m deep, and 200 m wide. It is believed that mineralization averaging 1-1.5 g/t potentially exists along 3-4 kms. If this is confirmed, drilling to test mineralization at depth will be the next step.

At a specific gravity of 2.7 and based on a 30% recoverability factor typical in the Abitibi area, 1 million to 1.5 million ounces of gold are suggested in the present area of mineralization alone.
We think that if drilling confirms what the company’s geological team believe, (and several technical staff on loan to the company from Agnico-Eagle [TSX:AEM] (who is sniffing around) rumblings of comparisons to an Osisko [TSXv:OSK] type super-pit could start to echo in the junior market.”

The only problem is that the recovery rate, according to various sources including last year’s sampling project. The recovery rate should be over 90%. In other words, Courville should have much more gold than reported in the Resource Investor report!

While Resource Investor is ultra conservative on the recovery rate, they are optimistic on the target area as the numbers reported have not been proven yet. It seems that the target area is an educated guess, while not proven, should prove to be reasonably close to reality. PRO will need about least 18 months to prove whether these numbers.

However, so far so good, and even the management seems to agree with assessment as hinted in their recent new release.

If the numbers of Resource Investor is true, Courville should host minimal of 3 M oz of gold to 9 M oz of gold, open pit, low cost, and long life. This is commonly referred to as “superpit”. And a superpit has significant value. Due to its low cost of production, large tonnage, and long life nature, each oz of gold in ground should be valued at least $100 per oz.

This year’s drilling should easily prove Courville have 1 to 3 M oz of gold, and that will translated into $100 M to $300 M US market cap for PRO. As PRO has only about 35 m shares outstanding, this should translate into $3 to $8 per share.

It is likely that PRO will JV with a major, and thus the gold value will be diluted. But at the same time, PRO will not need much money to develop if JV.

Those who doubt the value of Courville, should read the news release at
http://www.stockhouse.ca/news/news.asp?newsid=5039350&tick=PRO

The following paragraph from the news release shows that the management is confident that Osiko’s type project can be found at Courville, and OSK has a market cap of $600+ M

“Assay results to date continue to confirm the geological model outlined in December 2006 - that extensive lower grade gold corridors contain higher grade but narrower gold zones (refer to news press release dated January 18, 2007). Utilising this type of geological model it is not essential to find higher grade narrow gold veins, particularly if the mineralization is near surface. It is more important to deliver constant grades over substantial thicknesses for potential open pit-type mineral resource scenarios. This is consistent with other active gold projects in the Abitibi Greenstone belt. As an example Osisko's (TSX VENTURE: OSK) Canadian Malartic project that grades between 1.14 and 1.20 g/t gold over hundreds of meters.”
If Courville has the same value as OSK, PRO should be around $15 to $20 if it can keep the current share structure. It is an excellent wait for 2007-2008 drilling project to be completed. Even if PRO dilute 15 M shares to 50 M shares, PRO should be $12 for Courville alone if it has the same market cap as OSK.

Cusi project

This is a JV with DIIB with PRO having 30% of value eventually. Recently, a large silver system has been identified with excellent drilling results. The 5/2/2007 news release brought a lot of attention on the Cusi project:

http://www.stockhouse.ca/news/news.asp?newsid=5486228&tick=PRO

The following paragraph shows how exciting the Cusi project is, and significant implication of the Cusi project to PRO:

Mr. Jean Lafleur, Director and Technical Advisor, states "(...) Having now observed the mineralized system underground at San Miguel and La Bamba, there is a clear indication of a significant silver system that could contain a large tonnage potential using combined narrow higher grade veins and wider lower grade haloes. Dia Bras and Pershimco are actively moving forward with the exploration program at La Bamba and San Miguel with over 10,000 m of drilling planned to delineate higher quality mineral resources in 2007, to a depth of nearly 500 m below the topographic surface".

One highlight of drilling results is

"3,780 g/t silver intersected in surface drilling at La Bamba Pit".

That is fantastic result! Near surface, exceptionally high grade, suitable for open pit.

Las Minitas Project

Currently, Las Minitas has about 1.5 M oz of gold equivalent with 43-101 immediately. As Las Minitas has 100+ m oz of silver, or about 2 M oz of Au in equivalent. PRO owns 75%, and it means, PRO now owns 1.5 M oz of gold.

Las Minitas has the potential for hosting 11 M oz of gold in equivalent in historical resource. That will add another significant resources and potential to PRO. This is like another Courville, except now we have 1.5 M oz of Au in 43-101.

If we just assign $20 for each oz of Au to 43-101 1.5 M oz of gold, this will add $30M value to PRO, or about $.88 to the stock price (currently at $.86). And that is low. So, we should expect PRO trading at $1.80 very soon. However, the potential for Las Minitas is so grear that, this deal should add $3 on top of the existing PRO share price soon.

This is a very big, and growing target – and the higher-grade portions are easily targeted for bulk-sampling to pay for development.
From Raven Gold website at

http://www.ravengold.com/projects/lsmintas.php

"Historical information regarding Las Minitas indicates three mineralized zones of interest that contain a total potential of 22 million tons of ore grading 20 oz/t silver and 0.08 oz/t gold. Metallurgical testing indicates that recoveries of 90% for both silver and gold may be achievable by cyanidation alone."

22M tons x 20 oz/ton silver = 440 M oz of silver = 8.8 M oz of Au equivalent potential, and out of 8.8 M, 2 M oz of Au proven already.
Also, note that 20 oz per ton, each ton is about US $280, that is high grade.

Raven lost the project due to its inactivity, and now PRO takes over the Las Minitas project. Furthermore, PRO not only takes over the original Las Minitas project, it also takes over the surrounding area, a very large area, too. Thus, the potential for the new enlarged Las Minitas is even better.

Las Minitas project should add $2 to $3 value to PRO immediately. PRO will pay $10M dollars over the next few years (including payment to TRGD and drilling), and 750K shares to TRGD as payment. The total payment is 10 M + PRO shares. As PRO is expected to grow significantly, TRGD get the best deal from PRO shares. (If PRO is $10 next year, TRGD gain $7.5M. With the kind of growth PRO is receiving, there is a good possibility PRO will be $5 to $10 next year)

Camila/Melina and 7 other Concessions

Not many people follow Camila and Melina, but they actually are significant projects with lots of potential. In fact, they might have more value than some other PRO projects in the future as observed by geologists (note that this is comparing with Courville and Cusi, two very outstanding projects). In other words, these projects have exceptional value, just few people know much about them. As they have not been developed, no data can be reported to support the speculation.

Recently, PRO has also acquired several news projects near Camila and Melina, see the new release on 3/28/2007.

http://www.stockhouse.ca/news/news.asp?newsid=5017869&tick=PRO

For example, the Vicky concession:
- Vicky Concession - historic sampling in the shaft outlined 1% to 7% Copper; whereas 50 to 100 tonne bulk samples gave up to 19.6 g/t Gold, 424 g/t Silver, 26% Copper and 1.2% Zinc;

These results are simply fantastic! 26% copper is about 572 lb of copper per ton, and that is more than US $1,000 per ton for copper alone (assume only $2 per lb).

Other important factors:

A) PRO has a extremely aggressive drilling program for 2007. Probably the most aggressive drilling program among juniors. The PRO people are competent, and they are able to maintain those drilling program even though other juniors having great difficulties in finding drilling teams for their projects.

B) PRO knows how to operate in Mexico, and few companies can do so. Recently Raven gave up Las Minitas as a result, and PRO was able to pick up this wonderful property.

In summary, PRO should go to $2 to $3 very soon due to the above excellent news concerning excellent properties, aggressive drilling programs, excellent drilling results from Cusi and Courville, and immediate revenue from Cusi. So, PRO should be 2-3 bagger very soon.

The long term target (3 to 4 years?) is $30 or more, or about 30 bagger from the current price.

Risks:

There are always risks with mining companies. Some include

1) metal price;
2) Too many excellent properties. Other companies suffer from lack of good properties, but PRO may have too many good properties that they may not be able to develop these at the same time. (Thus, it is possible that PRO will JV with a major on Courville and focus on Las Minitas and Camila/Melina instead, but this is completely wild guess at this time).
3) Dilution. As PRO acquire new properties, they will need money, thus dilutation is coming. But the current share structure is so tight, even it dilute to 50 M, the share structure is still excellent and tight

Jagman I 2nd express40......even though they will probably bash me for it.

An anonymous investor submits: A few months back, there was an article published on Oilsands Quest (BQI) called “9 Good Reasons to Like This Oil Sands Name.” Now, after some extremely positive news from the company, I am adding a 10th reason.

Just some background: last winter BQI drilled 30 holes, 24 of which encountered bitumen. When Norwest (NWE), the third party consultant, evaluated BQI’s core samples, it estimated reserves to total 525 million barrels. Thus, about 22 million barrels per hole.

Currently, BQI is undergoing its 2006/07 winter drilling program which could consist of up to 250 holes, 150 exploration and 100 delineation (these are the ones that could add to estimated reserves later this year). For the time being, let’s only pay attention to the 100 potential holes since they are the only ones that could add to estimated reserves.

Assuming that all 80% (a very conservative assumption based on last year’s drilling success rate – you’ll see what I mean below) or 80 of those holes encounter bitumen at the same volume per hole as last year, the company would add 1.76 billion barrels (80 holes x 22 million barrels per hole) to its current reserve estimate of 525 million barrels. Assuming each incremental barrel of reserves is worth $1, obviously, that 1.76 billion in additional reserves would be worth $1.76 billion (even I can do that math!).

Again, assuming that the value of each of its barrels in the ground is $1, the company’s market cap should intuitively be $525 million. That assumes that the company has NO other assets worth anything. However, the company’s market cap is currently $729 million. That implies that the market is valuing all of the company’s “other assets” at $205 million.

Now, for the interesting part! If you take the implied market valuation of $204 million for the company’s other assets (i.e. the land it’s currently drilling) and divide it by the potential value of those assets of $1.76 billion, you get 12%. If I remember the expected value session of my Statistics 101 class correctly, that means that the market is only ascribing the company an 11% chance of increasing reserves by 1.76 billion barrels this drilling season. That seems VERY LOW to me given that the company just came out on Tuesday saying that they’ve already completed drilling 31% of its potential 100 delineation holes for this drilling season with excellent results. Of note, out of the first 31 holes of the 2006/2007 drilling season, 27 have intersected bitumen. That implies an 87% success rate (=27/31). To put that in perspective, 40%+ success rates are considered good in the industry.

If you assume that the company has a 41.5% chance of adding 1.76 barrels (or $1.76 billion in value), you would get an expected incremental reserve value of $729 million, and the stock should be a two-bagger when the results are reported later this year. If you assume that the company has an 80% chance (in line with its 2005/2006 drilling success rate, you would get an expected incremental reserve value of $1.41 billion and the stock should be almost a three-bagger later this year.

With this kind of major upside potential, I would think that this stock will appear on many more radars over the next couple of months and that we’ll see a lot more investor interest in this stock.

Already, since the company reported its preliminary drilling results on Tuesday, the stock is trading about 1.76 million shares per day, or about 79% more than its recent average of about 986,000 shares per day. Barring a major collapse in oil prices, I would think the stock continues to appreciate until the company releases its estimated reserve numbers around October of this year.

Disclosure: Author is long BQI.

What Makes Oilsands Quest So Compelling?

Posted on Apr 30th, 2007 with stocks: BQI

An anonymous investor submits: A number of months ago, an article entitled “9 Good Reasons to Like This Oil Sands Name” highlighted the merits of Oilsands Quest (BQI) (formerly known as CanWest Petroleum). Given the recent updates on the company and the recent weakness in the stock price, I thought it would make sense to take another look at BQI.

Sector: Oil Sands / Oil & Gas Exploration and Production

Key Asset: Over 500,000 acres of land in Saskatchewan potentially holding approximately 60 billion barrels of oil.

Why Own It?

# The company has top notch management with a track record of building an oil sands company (CEO, Chris Hopkins founded Synenco [SYN]).
# On a macro level, it’s a play on the increasing importance of the Canadian oil sands. Specifically, worldwide, demand is continuing to grow, driven by incremental demand from China and India. Meanwhile, non-OPEC supply growth is not keeping pace. As such, the world is on a trajectory to increase its reliance on Middle East oil. For the U.S., that is a major security issue. The solution? Increase access to “friendly” sources of oil such as the Canadian oil sands.
# It’s one of the best ways to play the increasing M&A in the oil sands space. On Friday, April 27th, Statoil (STO) acquired privately held North American Oil Sands Company for $0.91 per barrel, or $1.97b U.S. for 2 billion barrels of recoverable reserves. M&A activity in the Canadian oil sands space is expected to increase as oil companies struggle to replace reserves and increase production.
# The stock has significant valuation support. Statoil’s April 27th acquisition should provide of floor to the valuation of BQI. If you apply the $0.91 per barrel valuation to BQI’s 1.5 billion of estimated resource (assuming 50% is recoverable), you get a valuation of $683 million, or $3.46 per basic share, or about $2.90 per fully-diluted share. It’s important to note that the 1.5 billion estimate is probably conservative and will likely evolve into a 2.0+ billion number in July, when management comes out with its official OBIP estimate. That would turn the $3.46 and $2.90 per share valuations into $4.60 and $3.86 per share, respectively. If you also assume that BQI can employ newer oil sands technology to increase recovery, such as Petrobank’s THAI technology, which is said to be able to produce recovery rates of 80%, the $4.60 and $3.86 figures turn into $7.36 and $6.18.
# The above valuation discussion only applies to 2.0 billion of estimated resource. Management believes that the company’s property could potentially hold up to 60 billion barrels. So essentially, investors who buy at the current price get a free option on 58 billion+ of the company’s resource potential. If the company’s property actually holds 60 billion barrels of resource, the stock’s valuation would, theoretically be 30x the figures noted above if you assume the company’s land is homogenous and its characteristics/oil content is consistent throughout. Clearly, this would be the upper bound of the valuation.
# Recent options activity indicates that investors are discovering the BQI story (heavy call option volume for July 5 strikes and October 5 strikes). The volume on calls outweighs comparable put volume by a significant margin. Clearly, some investors are betting big on BQI’s prospects.
# There are numerous near-term catalysts could boost the stock Updates on summer drilling program over the next couple months

1. Update of Axe Lake project potential based on core data in July (could be upgraded from the 1.25 to 1.5 billion barrels estimate released in early April)

2. Toronto Stock Exchange listing should provide more demand for the shares later this year

3. Finalization of Saskatchewan government’s oil sands royalty framework

4. 3rd party data estimating its potential resource on its first project, Axe Lake, is due out in October (this will significantly lower risk associated with company’s resource estimate and open the door to negotiations for a joint venture). That number will likely be in excess of 2.0 billion barrels.

5. The company could enter into a joint venture as between fall 2007 and 1Q08.

# Institutional investors have been buying over the last couple quarters. Major shareholders include Fidelity and Wellington.
# The stock has limited analyst coverage, which would likely change one more data is released on its potential resource and the company’s risk profile improves.
# Despite the company’s favorable operational/drilling updates over the past 4 months, which have significantly lowered the company’s risk profile, the stock is currently trading at $3.00 per share (near its recent low). The weakness in the stock price in recent months is attributed to a combination of its recent $30 million private placement as well as a recent lock-up expiration that has resulted in selling by early-stage investors, who purchased shares at much lower prices.

BQI 1-yr chart

The stock has significant valuation support. Statoil’s April 27th acquisition should provide of floor to the valuation of BQI. If you apply the $0.91 per barrel valuation to BQI’s 1.5 billion of estimated resource (assuming 50% is recoverable), you get a valuation of $683 million, or $3.46 per basic share, or about $2.90 per fully-diluted share

Sure,BQI is huge but it also has three or four times the shares issued as juniors like STP,PFM,NPE,Excelsior enery.They are all undervalued.But they are all a long long way from producing oil and turning a profit.
I will be disgusted if the Canadian government allows foreign nations to buy them up at these prices but it looks like this is already happening.

M3
ay.

Here are some numbers that show how money in circulation is going up all over the world, which will result in a loss of purchasing power:

Percentage of annual increase in circulation*:



Eurozone: +10%

Great Britain (M4): +13%

India (M3): +20.3%

China (M2): +17.2%

Australia (M3): +13%

South Korea (M3): +11.3%

New Zealand (M3): +18%

Japan (M3): + 6%

Russia (M3): +49%

USA (M3) +12% (Est.)

*Data from John Embry, Sprott Asset Management, Toronto, Canadá.

The M3 data for the USA is no longer published by the Federal Reserve, as of March, 2006. It is suspected that the "Fed" wants to hide what is going on. Some individuals have made careful studies which lead us to believe that the annual increase of M3 is at 12%.

stp is considered the standard by which pfm is compared.
think about this.
stp has 80 % of 150 million barrels on its 16,000 acres for just 2.5 million barrels per share.
pfm has 100 % of 625 million barrels on its 14,500 acres for over 15 million barrels per share.
pfm has 100 % of over 25,000 acres surrounded by 3 major oil sand projects and will add another 10,000 to 15,000 acres next week.
they have not identified their land position because it is so valuable.
no insiders have been selling.
pfm have acquired their land by quiet research, selecting only the best high density land available over the past year.
everything will be disclosed by the agm on tuesday may 28.

that means next week will see more big news developments that will push the oil assets to over 3 billion barrels

Oil sands are deposits of bitumen, a heavy black viscous oil that must be rigorously treated to convert it into an upgraded crude oil before it can be used by refineries to produce gasoline and diesel fuels. Until recently, Alberta's bitumen deposits were known as tar sands but are now referred to as oil sands.

Bitumen is best described as a thick, sticky form of crude oil, so heavy and viscous that it will not flow unless heated or diluted with lighter hydrocarbons. At room temperature, it is much like cold molasses.

Oil sands are substantially heavier than other crude oils. Technically speaking, bitumen is a tar-like mixture of petroleum hydrocarbons with a density greater than 960 kilograms per cubic metre; light crude oil, by comparison, has a density as low as 793 kilograms per cubic metre.

Compared to conventional crude oil, bitumen requires some additional upgrading before it can be refined. It also requires dilution with lighter hydrocarbons to make it transportable by pipelines.

Bitumen makes up about 10-12 per cent of the actual oil sands found in Alberta. The remainder is 80-85 per cent mineral matter - including sand and clays - and 4-6 per cent water.

While conventional crude oil flows naturally or is pumped from the ground, oil sands must be mined or recovered in situ - meaning 'in place.' Oil sands recovery processes include extraction and separation systems to remove the bitumen from sand and water.

Alberta's oil sands comprise one of the world's two largest sources of bitumen; the other is in Venezuela.

Oil sands are found in three places in Alberta - the Athabasca, Peace River and Cold Lake regions - and cover a total of nearly 140,200* square kilometres.

Mineable bitumen deposits are located near the surface and can be recovered by open-pit mining techniques. For example, the Syncrude and Suncor oil sands operations near Fort McMurray, Alberta, use the world's largest trucks and shovels to recover bitumen.

About two tonnes of oil sands must be dug up, moved and processed to produce one barrel of oil. Roughly 75 per cent of the bitumen can be recovered from sand; processed sand has to be returned to the pit and the site reclaimed.

In situ recovery is used for bitumen deposits buried too deeply - more than 75 metres - for mining to be practical. Most in situ bitumen and heavy oil production comes from deposits buried more than 400 metres below the surface of the earth.

Cyclicsteam stimulation (CSS) and steam-assisted gravity drainage (SAGD) are in situ recovery methods, which include thermal injection through vertical or horizontal wells, solvent injection and CO2 methods. Canada's largest in situ bitumen recovery project is at Cold Lake, where deposits are heated by steam injection to bring bitumen to the surface, then diluted with condensate for shipping by pipelines.

Other technologies are emerging such as pulse technology and vapour recovery extraction (VAPEX).

North American Oil Sands Markets Assessment finds that the market increased to 966,000 barrels per day (bbl/d) in 2005. With anticipated growth, this level of production is estimated to reach three million bbl/d by 2020, and possibly five million bbl/d by 2030.

Oil sands are predominantly found in Canada and in small quantities throughout few regions of the United States. The Alberta province of Canada has more than 95 percent of the world's oil sands reserves. The total amount of bitumen is more than 1.6 trillion barrels, with over 178 billion barrels being accessible by using existing technology.

North American and Canadian oil sands reserves are providing opportunities for the oil companies and governments to find innovative and economic ways to extract and process oil sands.

The majority of Canadian oil sands production needs to be exported to the United States for refining, creating two major issues for producers. One issue is identifying markets that have the process capacity to handle the very high volume of production. The other issue is that many of the accessible markets like petroleum administration for defense districts (PADD) II, III and IV may not be able to process anything but fully upgraded synthetic crude oil (SCO). This would significantly reduce netbacks for oil sands producers.

“In order to overcome these issues, oil sands producers are either purchasing refineries or are tailoring output to suit refineries, while some are entering into long-term agreements with refineries,” observes Rajan. “Producers can also benefit by upgrading bitumen into high-quality SCO and introducing new blends such as diluted bitumen (Dilbit) and synthetic bitumen (Synbit) to meet refinery standards.”

Imminent growth of the North American oil sands market is dependant on the number of participants and their active involvement toward the development of this promising energy reserve.

Why isnt BQI $30?I think you can ask the same of most of the junior oilsand stocks.Why did they refinance BQI at only $2.75{plus warrants)?
I am interested in BQI because it is one of the few oilsand juniors I can buy in my IRA account.But I am not in yet as I am fearfull it will dip to $2.75.

FT.com
Canadian oil sands
Thursday May 17, 6:25 am ET

Canada, sitting on a potential 315bn barrels of recoverable oil, offers a tantalising prospect: a Middle East-sized prize in a reassuringly dull environment. There is just one problem. Canada's peculiar geology means much of its oil is mixed in with sand. These oil sands have to be either mined or heated deep underground to force the oil up to the surface ("in-situ" drilling). The viscous tar that results then has to be processed so that it can be refined.

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That makes oil sands expensive. Citigroup (NYSE:C) reckons they only make sense in a world with long-term crude oil prices of more than $40 a barrel. Fortunately for fans of sands, few expect oil to drop to that level anytime soon. The size of the resources potentially on offer means that, although upfront capital expenditure is huge, output - and hence cashflows - should be steady and long-lasting.

The initial investment phase is, therefore, critical. There are two concerns right now. First, cost inflation, a scourge of oil industry profits the world over. Second, uncertainty over the fiscal regime. Canada charges a royalty of just 1 per cent on oil sands revenues until capex has been recouped, but that is under review. Were it brought into line with the standard rate of 25 per cent, smaller, early-stage projects would be hit hard.

Valuations in the oil sands sub-sector have risen on the back of recent acquisitions by Statoil (NYSE:STO) and Royal Dutch Shell. The latter offers diversified exposure: oil sands will account for less than 5 per cent of Shell's oil production by 2010. With pure plays, investors should favour in-situ drillers - typically less capital-intensive than miners in early development, mitigating sensitivity to any change in royalties. Suncor, in particular, is weighted towards in-situ projects and already pays royalties at the full rate on virtually all its existing output. Uncertainty ought, in theory, to delay projects on the drawing board, easing bottlenecks for those already being developed or producing.

Unlike Arabia's deserts, Canada's sands are at least accessible, but investors still need to tread carefully.

SUBJECT: A 10 + Bagger with Strong Certainty Posted By: TheRock17
Post Time: 5/17/2007 18:14
« Previous Message Next Message »

It is evident from many of the posts on this board, that most posters dont have much of a clue as to what their investment here means in terms of future value. And so, tommorow or next week they will sell out, not even realizing that this asset play has yet to make its bigger move.

Credit Suisse has provided estimates of EV ( EV= Market cap + Debt ) for oil sand stocks over the past 2-3 years ( along with an excellent summary of oil sands themselves ), and these can be viewed here......

http://www.altanet.or.jp/CreditSuisse.pdf

As can be seen from this table on p12, the valuations of oil sand stocks has been increasing recently, and values in excess of $2 per boe for oil in the ground have been recorded up to 2006.

This week, PBG ( $25.50 /85 million shares ) paid $120 million to acquire the remaining 6000 acres ( 16 % ) of its undeveloped Whitesands bitumen that it did not already own.

That amounted to $26,000 per acre.

Whitesands has 39,500 acres and is being tested from the McMurray Formation by SAGD, much the same as PFM.

Note, from the PBG website, that the updated resources for Whitesands is 2.6 billion barrels of bitumen in place.

That computes to about 65 million barrels of bitumen per 1000 acres.

Today, for its initial 14,700 acres of oil sands ( my guess is very close to PBG's ) PFM has 1.15 billion barrels of bitumen.

That computes to 80 million barrels of bitumen per 1000 acres.....significantly higher than that of PBG.

PBG just paid $26,000 per acre for that bitumen.

PFM has 25,800 acres of higher density bitumen which, even at $26,000 per acre, amounts to an asset value of $675 million.

That asset will be fully delineated within a year and it will cost only $10-$15 million to do so.

3 years later when it will be producimg, it will be worth $250,000 per acre..or well over $5 billion.

Even better, PFM is closing in on more oil sands land very close to its current premium land. That acquisition should put PFM on equal footing with PBG in terms of acreage and likley more in recoverable oil, putting it in the same league as UTS.

As we all should know, conventional oil and gas production is on a decadal and permanent decline in N America, including Canada. Its costing more and more to replace such conventional supplies, which is why so many junior oils are facing a bleak future, as finding costs per boe are rapidly increasing, with consequent negations on their debt to equity ratios.

The only source of abundant new supplies is the oil sands, and , as conventional production continues to decline, the oil sands will continue to increase in value...ie the 3-fold increase over the last 3 years is a real trend and not an anomaly.

This is why getting in on the ground floor of an emergent oil sands play makes good investment sense.

PFM is rapidly developing into a premium asset enhancement play that is bound to attract cash rich suitors over the next 1-2 years.

When it does, we will be getting at least $1 per recoverable barrel and perhaps double that.
Thats the first 10 bagger .

Who knows, perhaps PFM already has its sugar daddy already lined up...

EXEL.CNQ
EXEL on the cnq has double the oil in place than STP..just a heads up see their news release

Excelsior Energy Ltd (C-EXEL) - News Release
Excelsior receives Hangingstone bitumen estimate

2007-03-27 06:23 MT - News Release
Shares issued 27,556,028
EXEL Close 2007-03-26 C$ 0.44


Mr. David Winter reports

EXCELSIOR RELEASES DEGOLYER AND MACNAUGHTON'S PRELIMINARY BITUMEN IN PLACE ESTIMATE FOR THE HANGINGSTONE HEAVY OIL PROJECT IN THE ATHABASCA OILS SANDS AREA

Excelsior Energy Ltd. has received from DeGolyer and MacNaughton an audit of geological mapping and a preliminary determination of bitumen in place on Excelsior's Hangingstone property, near Fort McMurray, Alta.

For the report, DeGolyer audited the geological mapping of the property, which covers 39 sections (24,960 acres), and determined the net sand thickness with bitumen saturation greater than 70 per cent and average porosity greater than 30 per cent. DeGolyer estimated that 1.61 billion barrels of bitumen in place may be contained in gross oil sands thicker than 30 metres. Furthermore, DeGolyer estimated that 2.49 billion barrels of bitumen in place may be contained in gross oil sands greater than 15 metres. Upon earning, Excelsior's 52.5-per-cent working interest share of estimated bitumen in place will be 849 million barrels and 1.3 billion barrels bitumen in place, respectively.

The bitumen in place is contained in four mapped pods, which will be the focus of the 24-well evaluation program to delineate a core area for an SAGD pilot project. A 137-kilometre seismic acquisition program is under way on the Hangingstone property.

We seek Safe Harbor.

From another board
Folks - new to the board

This baby has been driving me crazy since last week - was in and out between .93 and 1.00 - - what a lesson - am a new trader - finally got in today at 1.50.

IMHO - Petrobank paid $120m for 16% of an estimated 2.6m barrel bitumen. That makes the estimate value $750m (120/.16)

So my DD is as follows:

PFM's 1.15m estimate is 44% of Petrobank's making the property worth $330m (44% of $750m). PFM has, with current 29m o/s and add another 10m recent PP and say add another 10-15m in warrants to be exercised(guestimate) - say 55m when all is counted.

My fair value for PFM is 330m/55m = $6.00

I'm not selling....

PFM.V About 41 million shares on issue.
Independent Resource Report Estimates 1.15 Billion Barrels of Initial Bitumen in Place
12:09 EDT Thursday, May 17, 2007

/NOT FOR DISSEMINATION IN THE UNITED STATES OF AMERICA./


CALGARY, May 17 /CNW/ - Platform Resources Ltd. ("Platform") (TSXV: PFM) is pleased to announce that Ryder Scott Petroleum Consultants ("Ryder Scott"), an independent petroleum consulting firm, has completed its assessment of the bitumen resources attributable to Platform's initial oil sands land parcel encompassing 23 sections. The land is situated within the Athabasca East oil sands area of North East Alberta Canada.

The Ryder Scott report (the "Report") estimates 1.15 billion barrels of initial bitumen in place (IBOP) on this 23 section parcel.

Net bitumen resource pay was determined using a 27 percent porosity cutoff and a 25 ohm-m resistivity cutoff (corresponding roughly to an 8 to 10% weight bitumen). For mapping purposes, only basal McMurray sands with a minimum continuous thickness of 10 meters were included in the bitumen resource calculations. An average porosity of 30 percent and an average water saturation of 20 percent were used in the bitumen resource calculations.

The 1.15 billion bbl of IBOP was calculated from the main bitumen pay zone (referred to as the "Basal McMurray"). The Report notes that bitumen saturation is also present in the Upper McMurray sands in some of the wells on and adjacent to the lands; this has not been included in the resource calculation but may have economic potential in the future.

The report concludes that the subject lands are surrounded to the south, east and north by several in-situ oil sands projects in various stages of development and confirms that in-situ steam assisted gravity drainage (SAGD) techniques will be utilized to recover the bitumen. SAGD projects adjacent to the assessed lands are estimated to achieve ultimate recovery factors of 50-60% of the initial bitumen in place.

These estimates are subject to change in light of additional data or as a result of future operations or other activities relating to a future delineation program.


The TSX Venture Exchange has not reviewed and does not accept

responsibility for the adequacy and accuracy of this release.

Cumberland Advisers.
Here’s why we believe that the lean years are over and that a big bull move is now directly in front of us.

Various value oriented measures suggest that the S&P500 has another 30% to 40% of upward potential in the next few years. We can reach this conclusion a number of ways. We will examine just one of them.

We initially expected the S&P500 to earn $93 in 2007. The first quarter numbers are now mostly known. 2 out of 3 of the S&P500 companies are exceeding consensus earnings estimates. With about 80% having reported we can now draw some powerful inferences for the entire year of 2007. One of them is that our $93 number is likely to end up on the low side.

The upward market movement has been driven by the large cap stocks. These big guys comprise the heavy weighting of the US stock markets. They are benefiting from the weaker dollar. They have substantial cash. They are able to borrow cheaply. Their cost of funds is under 6% before taxation or under 4% after taxes. Using derivatives (swaps) they can lock in these costs of funds for several years and they are doing so.

That is why they are using cash or borrowing to buy back their own stock. It is a bargain for them. The same applies to the private equity folks. So we have a diminishing supply of publicly-traded equity which is being financed with cheap debt. About $600 billion in stock value has been retired or retrenched to private hands from the public markets. Shrinking stock supply and growing demand from rising earnings is a recipe for higher prices.

The macro stage supports our view.

In our slowly growing low inflation US economy, we can expect the nominal GDP to increase about 5% per year. That takes the US economy to about $17 trillion in output by the end of 2010. The largest part of the non-government sector is in services and is relatively stable. Healthcare, for example, will be nearly 18% of GDP by then.

In such an economy, we will see about 2%-to-2 ½% inflation. We expect 2 ½% to 3 ½% real growth. In that climate, the S&P500 earnings can easily increase about 7%-to-8% per year. Remember: earnings grow faster than the economic growth because of the leverage in corporate balance sheets. For US big cap stocks, this earnings growth is assisted by the international addition to the US reported earnings. They come from the foreign subsidiaries of these US companies. And the earnings per share are enhanced by the continuing stock buybacks.

Simple math gets the S&P500 earnings to a $115-to-$120 range by 2010. A 17 price/earnings ratio easily gets you to 1950-to-2000 on the S&P500 index. That would still be within an environment of moderate economic growth and moderate inflation. And we would still be seeing reasonably low interest rates centered on a 10-year Treasury note yield of around 5%.

No dream here. We are not attempting to make the case for stocks by excessively valuing the stock market. Sure, a frothy and exuberant time will come just as it has in the past. And by then it will suck in the uninitiated as it did 8 and 9 years ago. We believe that is out in the future and possibly many years away. That is why Cumberland’s stock portfolios are fully invested, worldwide.

There are some assumptions and readers may, of course, disagree. Here are ours. We are basing our strategy on them.

We believe that the world’s financial systemic risk is well contained by the global consortium of central banks and institutions. Inflation is a risk but it is also high on the policy maker’s radar screens. It seems manageable through skilled application of monetary policy. The housing price adjustment is certainly under way. But it has not turned into a recession and it is not causing contagion. The US labor force is more than 95% employed. Worker’s incomes are rising. The unemployment rate is decidedly skewed by education. It is under 2% for college graduates and around 4% for high school grads with some college. Only those who do not complete high school face a 7% unemployment rate. Is this a problem? Yes. Does it derail our picture? No.

In sum, the situation is neither bleak nor excessively frothy. We believe that an investment policy should be centrist. Simply put, diversify broadly and worldwide. Own some bonds now that real yields are positive. Keep the bond duration close to neutral. Maintain what cash reserves are needed for comfort but otherwise a fully invested strategy will serve best.

Lastly, be aware that it is the shocks, the extraordinary events, which can sink the positive outlook. Those shocks can be natural events like bird flu or hurricanes. Or they can be politically driven like war, terrorism or protectionism. Those risks always exist. One doesn’t reposition a portfolio in anticipation. Acting BEFORE they occur is a mistake like waiting for Godot. Life and investing should not be done in a cave.

One can and should react swiftly if any of the shock scenarios unfold.

Sheet!I read all that to find out where the economy is at only to be told it is at the crossroads?
lol.

TORONTO, May 15 /CNW/ - Eurasia Gold Inc. ("Eurasia" or, the "Company") (TSX: EGX - News) announces that its Board of Directors is reviewing a proposed unsolicited all-cash takeover bid of $0.85 per Ordinary Share from Kazakhmys PLC ("Kazakhmys") for all outstanding Eurasia Ordinary Shares.

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Eurasia's Board of Directors is reviewing the proposed Offer in the context of the company's alternatives to maximize shareholder value. To assist in this analysis, Eurasia's Board of Directors has established an independent director's Special Committee comprised of Graham Bevan. It is anticipated that Mr. Bevan will retain independent financial and legal advisors.

"The Board will give due consideration to the Kazakhmys bid. Pending the Board's recommendation, shareholders are urged not to tender to the Offer," said Mr. Baltabek Mukashev, Eurasia's President and Chief Executive Officer.

PRO.V
With this news, PRO now have

1) About 1.5 M oz of gold equivalent with 43-101 immediately. As Las Minitas has 100+ m oz of silver, or about 2 M oz of Au in equivalent. PRO owns 75%, and it means, PRO now owns 1.5 M oz of gold.

2) Las Minitas has the potential for hosting 11 M oz of gold in equivalent in historical resource. That will add another significant resources and potential to PRO. This is like another Courville, except now we have 1.5 M oz of Au in 43-101.

3) If we just assign $20 for each oz of Au to 43-101 1.5 M oz of gold, this will add $30M value to PRO, or about $.88 to the stock price (currently at $.86). And that is low. So, we should expect PRO trading at $1.80 very soon. However, the potential for Las Minitas is so grear that, this deal should add $3 on top of the existing PRO share price soon.

4) PRO now has 5 company maker projects -- Courville, Camila, Melina, Las Minitas, and Cusi, each has the potential to become multi-million oz of Au in equivalent. Furthermore, Cusi is production now with several projects that will be in producton soon, and looks like Courville will be JV with majors as they are on site for sometime.

With low floats, so many excellent projects, and with 43-101 1.5 M oz gold in equivalent, I am looking for even bigger return in 4 to 5 years, probably in $30 to $40 range, a 30 bagger.

I guess PRO will make announcement soon to explain the good deal of Las Minitas tod

Gold Bears Have Two Weeks to Live - Mike Swanson (5/07/07)
By Mike Swanson
Created 05/07/2007 - 10:52
Early last week gold stocks fell hard only to end the week with a rebound. The drop caused many gold longs to liquidate their positions and left others wondering if we are going to even see another bull run this year.

On April 9, 2007, in my article "A Triple Buy Signal in Gold Stocks," I suggested that there were three technical indicators on the verge of giving powerful long-term buys for gold stocks. Since then we have seen gold stocks rise a bit, dip hard, and then rebound, but we have yet to see a new bull run for gold or gold stocks. Gold still remains below $700 an ounce and more and more gold longs are throwing in the towel.

I'll let you know why you shouldn't be one of these people in a moment.

It's been over a year since we saw the last major top in gold and gold stocks. Gold bugs have suffered, holding on to positions that trended sideways or sank in value as every potential breakout failed. More important than the monetary toll they have suffered is the psychological burden of living through the ups and downs of the consolidation trading range gold stocks have been stuck in all year.

People have been selling due to impatience as gold has continued sideways and a fear of losses every time gold stocks dip. Remember last summer when several leading gold commentators suggested that a big head and shoulders top was about to bring a new bear market in gold stocks?
Well, what about now?

In my article, I cited three things that told me a new bull run in gold stocks was beginning. I wrote the following:

--------------------------------------------------------------------------------

"Gold stocks have been in a long consolidation phase for over a year now. In the past, every time gold stocks have gone through similar long consolidation patterns they have emerged to launch powerful bull runs. There are three technical signs that suggest that this pattern is about to repeat in the near future:

1) Simple support and resistance trendlines are a staple of technical analysis. As you can see, the XAU gold stock index has been locked down by its upper resistance trendline since May of last year. The XAU is now only points away from breaking above this trendline resistance level, an act that would generate a second long-term buy signal for gold stocks.

In the past twelve months, every time it has rallied up to this trendline and failed to break out, a sharp correction occurred. If gold stocks don't immediately drop hard, they will be poised to break out and close above this trendline resistance level to generate a powerful buy signal. This trendline is currently at 146 on the XAU.

2) The 200-day bollinger bands are coming together. Bollinger bands measure the volatility of an index. When they come together it means that volatility is shrinking. This is important because shrinking volatility leads to expansive moves. 200-day bollinger bands are long-term indicators.

The two bands have acted as support and resistance for the XAU and HUI for the last year. It takes months and months of consolidation for them to come together like they have now. In fact, they are now closer together than they have been in five years. The XAU and HUI are likely to break above these 200-day bollinger bands and begin their next move up sometime within the next two weeks. Notice what happened when they did this in 2003 and 2005. A move above this 200-day bollinger band on the XAU will trigger a second long-term buy signal.

3) The action in gold stocks tends to lead the action in the metal. It is bullish when gold stocks outperform the metal and bearish when they lag the action in gold. During this past consolidation phase, gold stocks lagged the metal, just as they did during the last two long consolidation phases. This caused the XAU/gld and HUI/gld ratios to decline as you can see from the above chart. The last two consolidation phases ended once the XAU/gld ratio broke this downtrend line. The ratio has been steadily moving up during the past three weeks and is close to breaking out. Such a breakout would give us a third long-term buy signal.

If all three signals occur within the next few weeks, we will then have a confirmed triple super buy for gold stocks. The next leg up in the gold bull market will begin. But those waiting for full confirmation of the signal will easily end up missing out and will buy for higher prices. The time to think about buying is now, not later."

--------------------------------------------------------------------------------


The first signal happened several weeks ago. The 200-day bollinger bands for the XAU are still coming together, suggesting that any break to the upside will have the potential to create an even more powerful rally than I imagined a month ago. The XAU/gld ratio remains stuck below its downtrend resistance line, but is going sideways and appears to be poised to breakout of it in a few weeks. Take a look at this chart:


You can see on this chart how the 200-day bollinger bands are narrowing. Take a look at how the bollinger band width indicator in the chart above continues to drop. What this means is that the volatility in gold stocks is still shrinking.

I know the XAU just dipped below 140 last week, but this was the quickest and most shallow correction in gold stocks we've seen in a year. The recovery happened in the blink of an eye.

This suggests that the volatility is reaching an apex. We may see gold stocks trend sideways in a narrow range for another week or even two, but after that we should see a rally that breaks through the upper 200-day bollinger band to establish the next powerful intermediate-term upleg in gold stocks.

How high could it go?

Well, history suggests when the XAU/gld ratio hits .20, which it did in March and once again in May, the XAU rallies 40% over the course of the next twelve months. And, of course, the right gold stocks do even better. In fact, some of my gold stocks broke out last week and others that I am watching right now are poised to make similar moves this week.

In the final analysis, the next two weeks should complete the end of the consolidation phase for gold stocks and bring the next bull run for gold stocks.

In two weeks the fun should begin. Gold bears have two weeks of life support left

PFM.V
SUBJECT: $2 this week is possible Posted By: elcaudillo
Post Time: 5/13/2007 18:59
« Previous Message Next Message »

platform has only 1/4 the market cap of stp, but has twice the oil sand holding and has existing oil production besides.

so, should be lots of upside yet.
this week we could see the independent reserve report, more oil sand acquisitions, tv exposure on bnn, coverage by newsletter, and perhaps some unexpected news out of the blue.
investor relations in the works too.
summer driving season should help as it will push up oil prices.

that is wrong.

PFM has no debt, as the $3-$4 million extant at Q1 was paid off as part of the $13 million, raised by the sale of some of its assets for $8 million, and the recent $5 million equity raise.

We are now debt free, with a strong residual cash position, and with remaining existing production of about 170 boe/day and an attractive Bakken oil asset in Manitoba.

did some comps last night that point to four to six dollars per share in the not too distant future.

My comparisons are based on mkt value per section, and mkt value per recoverable bbl., whichever is most comparable.

IMVHO, PFM will be better than STP in share price appreciation. I have placed my bets accordingly. STP holders, don't be offended. STP is a great story too, and you will make good there, I just think PFM is the cream of the crop right now.

Some point out that the exact location of our land not being disclosed increases risk to PFM holders - you are absolutely correct - it does. But, what you must do is to quantify that risk vs the benefit. The risk is so darned small IMHO. If that risk were removed, ie. the exact coordinates of our land being disclosed, you would pay another dollar per share instantly. I am willing to make that wager. I will repeat what I said earlier, "I have not yet found a bumb deal" that did not set out as a Pump and Dump. And 40 sections at 100% WI is as far away from a P&D as you can get. The very fact that so much has already been done without any pumping, speaks to the legitamacy of this OS asset play.

I used to think that the easiest to pick lowest hanging fruit was gone in the mkt. Boy was I wrong, this is as easy as it gets.

AIMHOBWTFDIK,DYODD,GL,VE
nb

PS: My eariest comps were pointing to $1.50 based on 23 sections in the ST. Now with 40 sections of land and only an extra 4 million shares - you do the math. My gut feeling is we likely paid 3-4 mil for the newest 17 sections. The best of it is that it is CONTIGUOUS LAND. This is very important; it cannot be emphasized enough. The synergy and economy of scale will attract more and higher bids down the road when we get taken out.

y own call on PFM, after revieiwing all of the evidence, suggests that this near-term upward trend should continue over the next few weeks and months for a variety of reasons.

.....One reason is the fact the Oil patch is heating up (
http://www.stockhouse.com/bullboards/viewmessage.asp?no=14617949&t=0&all=0&StartDir=N&am... ).
The oil and gas sector fell flat on its face after the spring of 2006, as valuations had increased substantially and as investors turned their capital to base and PM plays. THis trend has reversed itself in early 2007, and we are now seeing investors looking for the next big wave.

The other reason for increased interest in this sector is that Oil Prices are expected to increase (
http://www.stockhouse.com/bullboards/viewmessage.asp?no=14591044&t=0&all=0&StartDir=N&am... ).

....another reason is the fact that conventional oil and gas reserves in Canada have been declining for nearly a decade, which is why Oil investmest is shifting to the oil sands (
http://www.stockhouse.com/bullboards/viewmessage.asp?no=14561842&t=0&all=0&StartDir=O&am... ).

However, there arent many junior oil sand plays that are publicly listed ( less than a dozen ) and many of those that are availbale have already seen their market caps increase by an order of magnitude or more ( eg UTS at $2.5 billion ).

So, the choice is limited, and in such cases leverage is the key variable and PFM has the greatest leverage of those that are still attractive.

We also know that evaluation time is very rapid for Oil sand evaluation and that oil sands can be rapidly developed (
http://www.stockhouse.com/bullboards/viewmessage.asp?no=14643364&t=0&all=0&StartDir=N&am... ).

Evaluation of oil sand asset value is fairly straight-forward ,with recent evaluations at $1 per recoverable barrel and increasing with time (
http://www.stockhouse.com/bullboards/viewmessage.asp?no=14809555&t=0&all=0&StartDir=N&am... )

......also junior oil sands are strong asset plays( http://www.stockhouse.com/bullboards/viewmessage.asp?no=14763339&t=0&all=0&StartDir=N&am... )

....Further, as the Q1 report states, PFM is about to make more oil sand acquisitions which , even at 26,000 acres, places us in the elite leagues

....As well, we will soon see the commissioned report on the initial 15,000 acres of oil sands

....Its also possible that management have a JV partner already lined up to take the project to production. Such news could cause the market cap to quarduple or more overnite...

...and, of course, PFM has yet to provide the company with any investor exposure activities and those too are on the way.


For these reasons, and because PFM has existing production to pay for most of the G & A operating costs, I see PFM moving to the $4 level during the summer...perhaps higher should our bitumen-in-place be quantified at better than average recoverable oil densities.

It looks like Cannacord's position was taken out last week, so we could see a more rapid appreciation in the coming week..

PFM.V dreams
SUBJECT: Key point in the Pres. msg. Posted By: natureboy16
Post Time: 5/10/2007 15:00
« Previous Message Next Message »

Shabir still has not told us exactly where the land is. This is not by accident. I have absolutely no doubt in my puunny brain that we are still trying to add to that base. This is "Very" significant in my mind. All at 100% WI too.

And someone was asking about valuations recently?

You have not seen anything yet, folks.

We may enter the ranks of UTS, DCE, PBG, etc.

Puts us in even better stead in comparison to BCF, too.

I am still buying.

JMHO, VE, DYODD, GL
nb

Tumi Intersects 24.4m Grading 6.4 g/t Gold and 1,629 g/t Silver at La Trini, Mexico
Vancouver, Canada. Tumi Resources Limited ("Tumi" and/or "the Company") (TSXv-TM; OTCBB - TUMIF;
Frankfurt - TUY). David Henstridge, President of Tumi, reports that reverse-circulation drill-hole TRCC 32 drilled to a
depth of 186m, intercepted 24.4m grading 6.4 g/t gold and 1,629 g/t silver from a depth of 130m below surface. See
Table 1 on page 3 for all drill results.
Since 2005, the Company has been advancing the development of its 100%-owned La Trini silver-gold project in Jalisco,
Mexico. To date, the Company has drilled 35 reverse-circulation drill holes totalling 4,112m in two drill campaigns. The
Company's phase-two drill program has been focused on better defining the mineralized core zone and
establishing where future detailed drilling should occur.
Said Mr. Henstridge: "The results from TRCC 32 are significant and have identified an area where we will be focusing our
future work program. As part of the phase-two drill program a number of step-out holes were drilled up to 900m west and
600m east from the mineralized core zone to test the extensions of the rhyolite host rock, but these drill holes did not
intersect any significant mineralization. Drill-hole 32 is located 150m north of the limits of the old underground workings
within the core area, and mineralization intersected may represent a newly discovered bonanza zone."
Drilling, coupled with the surface and underground sampling programs in and adjacent to the main target area, has
defined a 400m-long northerly trending mineralized zone. The zone is 200m wide and remains open down-dip to the
north. Within this zone there appears to be a higher grade corridor along the eastern edge, possibly adjacent to a major
fault zone. Selected intervals from both drill programs within the higher grade zone include TRRC 6 (18.3m at 3.1 g/t Au
and 150 g/t Ag), TRRC 9 (6.1m at 1.1 g/t Au and 201 g/t Ag), TRRC 10 (10.1m at 1.6 g/t Au and 130 g/t Ag), TRRC 11
(5.1m at 5 g/t Au and 184 g/t Ag) and TRRC 32. The table of all drill intercepts from both drill programs in the mineralized
core zone along with a drawing showing the drill-hole locations and extent of the zone also appear on the Company's
website, www.tumiresources.com under Projects/La Trini.
Mr. Henstridge added: "The results from TRRC 32 have identified an exploration target which requires immediate further
drill testing. We are planning a phase-three program of closely spaced drilling to define the size and orientation of this
high-grade zone further and to define the extent of the main zone. We will schedule this program after a short break at
the end of the Company's Phoenix drill program currently underway in Sonora."
Grab sample checks of the high-grade intervals from the stored drill samples have returned comparable results, and
polished sections made from two of the samples has identified argentite (silver sulphide) grains, locally rimmed with native
silver, jalpaita (a silver-copper sulphide) and native gold. It should be noted that due to the nature of RC drilling and the
lack of nearby data, geological interpretation of the extent and true thickness of mineralized drill intercepts remains
uncertain.
The qualified person for Tumi's projects, David Henstridge, a Fellow of the Australian Institute of Mining and Metallurgy
and a Member of the Australian Institute of Geoscientists, has visited the Company's projects in Mexico and has verified
the contents of this news release.
Quality Control: RC drill samples were collected on 2.03m intervals. Each sample was split on site using a Jones splitter and stored for later use. The site geologist subsequently selected the intervals to be sampled, and the entire interval was run through the Jones splitter twice more to aidhomogenization. One-half of this interval was split further to a nominal 5 kg size and sent to Sonora Sample Preparation, S.A. de C.V. in Hermosillo

When will Wall Street wake up to uranium?
By Jon Nones
08 May 2007 at 12:19 PM

With uranium futures commencing on NYMEX yesterday, David Urban, an unknown blogger, says the uranium bull market has far more room to run.

He notes that Canadian uranium companies are now shifting their listings to the American Stock Exchange. Two recent companies are Denison Mines [AMEX:DNN] and Crosshair Exploration [AMEX:CXZ] with more expected to follow suit.

“If you are looking to invest in Uranium mining companies, you might favor companies who have applications filed with any of the major U.S. exchanges. Watch your technical charts for buying and arbitrage opportunities ahead of the listing date as brokers accumulate stock to push to clients,” concludes Urban.

Later this year, Wall Street is expected to start covering the Uranium sector when enough companies have listed to make it worth the time. Soon, U.S.-listed uranium funds will begin to appear....

They are probably not paying anyone to maintain it.Probably trying to eke out any remaining cash as long as possible.

cameco
shares added 2.2% at $55.75 on Friday after the uranium mining giant released a report on the ground fall and flooding that shut down the company's major uranium mine last year. The report says the firm "failed to fully appreciate the degree of risk" of working in less than ideal conditions at Cigar Lake, Sask. The mine is expected to be out of commission until about 2010