Natural gas relief by 2010: report

Friday » January 30 » 2009

Natural gas relief by 2010: report

Dina O'Meara
Calgary Herald


North American natural gas markets are expected to improve by 2010 as storage surpluses get drawn down and demand makes a slow recovery along with the economy, according to a new energy overview.

Peters&Co. predicts natural gas prices will remain muted until the end of the year as the United States economy struggles to pull itself out of a recession and fuel inventories fall.

"The price of natural gas will likely remain under pressure until we see a material change in U. S. domestic supply or demand," the energy brokerage said in Tuesday's report.

After hitting a high of $13.58 US last July, natural gas futures have averaged $5.37 US per million British thermal units year-to-date, with only the December contract prices at or above $6 per mmBTU.

Spot deals at the benchmark AECO-Chubarearound$5.69 per thousand cubic feet, with summer pricing at $5.73 per mcf, and 2009-10 winter pricing at $7.44 per mcf.

The energy investment broker-age house forecast a 1.125 trillion cubic foot drop in natural gas demand between January and November this year, with a 625 billion cubic foot supply decrease, driven by poor economics as industry and producers cut back.

However, as the economy revives and industrial demand revs up again, prices should start shifting upward, the report stated.

"While spot natural gas prices are currently depressed and will likely remain so for the remainder of the winter, there is some hope that equilibrium between supply and demand will begin to develop over the summer with our forecast for supply declines to catch up with demand shortfalls by the beginning of the 2009-10 withdrawal season," according to the report.

Canadian production is expected to fall by 700 million cubic feet this year and another 400 mmcf in 2010. The decrease will be driven by natural decline rates, around 21 per cent a year, steep initial production rate drops in the 60 per cent range, and a drop in new wells drilled, Peters &Co. said.

The number of new wells in the U. S. are forecast to fall about 15 per cent from current levels --already down 23 per cent from last summer--on poor pricing and tight budgets. Based on those numbers, supply could fall by around 2.5 bcf per day by yearend 2009, or 370 bcf, January to October.

The wild card in the equation could be the number of new wells that have been drilled but not completed and tied into a pipeline system this year.

A backlog of wells were a strong offset to Canadian production de-clines over the past two years, mitigating the pace of supply contraction.

"If the same situation exists in the U. S. the pace at which sup-ply declines could obviously be tempered," the report said. "In addition, in periods of low prices, operators generally revert to more recompletion activity in existing well bores, which could also bolster supply."

Production in the U. S. rose about seven per cent last year, while industrial demand, the high-est consumer of natural gas, fell. On this side of the border, production fell on natural declines and a drop in drilling.

Canadian storage levels currently are about two per cent lower than last year at the same time, affected by declining production, with U. S. storage down one per cent from last year. Withdrawals this winter are about 852 bcf compared with one trillion cubic feet last year.



© The Calgary Herald 2009

QEC Analysis Worth Reading

Pumped up: Why gasoline engines are here to stay

From Thursday's Globe and Mail

January 29, 2009 at 12:00 AM EST

Plans to develop electric cars, plug-in hybrid cars, fuel-cell cars, super-clean diesels, perhaps diesel hybrids and other exotic technologies — impressive and far-sighted as they are — are overshadowing the very real but less exotic steps the industry is taking to improve fuel economy and reduce emissions right now.

By "now," we are talking about the next 10-20 years. During that time, the internal combustion engine will keep dominating the automobile world. Exotic technologies are interesting, but the reality is that nothing is ready to unseat the gasoline-powered internal combustion engine.
On the contrary, the auto industry keeps finding ways to squeeze more efficiency out of gasoline engines.

Take the upcoming 2010 Chevrolet Cruze compact car. The Cruze, about the size of a Ford Focus or a Toyota Corolla, but roomier inside than both, will have one of the smallest engines on the market. Yet the 1.4-litre turbo will deliver the performance of a larger engine with fuel economy of 40 miles a gallon (U.S.) or about 5.9 litres/100 km.

More developments and refinements of this sort are coming, and soon, too. Auto makers are working on "twin charging," for instance. That uses two turbochargers or a turbocharger paired with a supercharger, to get more power and greater fuel efficiency out of smaller motors.
In fact, GM, Ford, and others, are launching big initiatives that involve tweaking internal-combustion engines with turbochargers and a technology called gasoline direct-injection. Their goal: make fuel-stingy small engines perform like big ones.

Ford's Derrick Kuzak, the head of all product development at the company, says his company's EcoBoost technology makes smaller engines perform like bigger ones, with no fuel economy penalty.

With EcoBoost, Ford uses turbochargers and direct injection to cut fuel consumption by up to 20 per cent and limit greenhouse gas emissions without any loss of performance.
"We are going to have 500,000 vehicles in the next five years that will have this technology," says Kuzak.

Direct injection makes fuel burn more efficiently by squirting it straight into the combustion chamber, instead of mixing it with air in an intake port.

Turbos are tiny windmills spun by otherwise-wasted exhaust. The turbo runs a compressor that pushes air into the combustion chamber where it mixes with fuel. The enhanced air/fuel mixture develops more power without a large fuel economy penalty.

EcoBoost will make its debut in the Lincoln MKS later this year. Its twin-turbo, 3.5-litre V-6 will have 340 horsepower. That's the horsepower equivalent of a V-8. By 2013, Ford says it will offer EcoBoost engines on 90 per cent of its models.

At GM, direct-injected, turbocharged engines are already sweeping through the automaker's lineup. The 2.0-litre, 260-horsepower, four-cylinder engine in the Pontiac Solstice and Saturn Sky sports cars has this technology. The same engine is in the SS version of the Chevrolet HHR small sport utility and the Chevy Cobalt SS.

At Mazda, the CX-7 crossover has the same 2.3-litre, turbocharged, four-cylinder engine with direct gasoline injection as the high-performance MazdaSpeed3. A 2.0-litre, turbocharged, four-cylinder with direct gasoline injection powers the Audi A3 five-door hatchback, A4 sedan and TT sports car.

Boosting engine performance with turbos and direct injection is a common-sense way to increase fuel economy. A gas engine modified in this way can grab a 20-per-cent fuel economy gain, while hybrids typically deliver a 30 per cent fuel savings, depending on the mode.

What really stands out, though, is the cost. Adding direct injection and turbocharging to an internal-combustion engine typically costs an auto maker about $1,000 (U.S.) per vehicle.
By comparison, the cost premium for a clean-diesel engine is at least $3,000, if not more, and gas-electric hybrid technology adds at least $4,000 to the cost of producing a vehicle (all figures in U.S. dollars).

The wild card in determining which technology makes the most sense: the price of fuel. In the last year, for instance, it's been all over the map, with oil closing in on $150 a barrel last year, only to fall to less than $40 a barrel recently.

Unpredictable fuel prices make it tough to make firm predictions, but Kuzak estimates that if oil goes back up to the levels seen last summer, the EcoBoost system will pay for itself in gas savings in less than three years for drivers who log about 24,000 km a year.

Some estimate a seven-year payback for diesel engines and 11-12 years for hybrids, though the cost of diesel engines and hybrids are coming down and, again, fuel prices are unpredictable.
Beyond engines, manufacturers are ratcheting up the number of gears in transmission to boost fuel economy. It is now common to see five- and six-speed automatic transmissions in even the most affordable vehicles.

Luxury makers have gone further by putting seven- and eight-speed automatics into their top-of-the-line cars. Mass-market vehicles are next to get those automatics.
Other new fuel-saving transmissions include the twin clutch and the continuously variable transmission (CVT). The CVT improves fuel economy by 5 per cent or so over a more traditional automatic.

At the same time, auto companies and suppliers are making real gains in improving fuel economy with better electronic controls and electrical (rather than mechanical) systems to help reduce fuel consumption and vehicle emissions.

For instance, Hyundai's new 2009 Elantra Touring has a base price of less than $15,000, yet it has electric power steering that eliminates the engine pumping losses that dog hydraulic power steering systems. The fuel economy gain is not great, perhaps 1-2 per cent, but it's very real. Most new models now come with electric power steering, regardless of vehicle price.
Auto makers and their suppliers are also rolling out other off-the-shelf technologies that help vehicles gain a little fuel efficiency here, a little there.

Take low-rolling-resistance tires. They use different tread patterns and additional silica in the tread to reduce the fuel-consuming forces that work on tires: air or wind resistance, inertia when accelerating, gravity when driving uphill, internal friction, for instance, in the transmission and the general rolling resistance that occurs when the rubber hits the road.

Then there is the stop-start system. It automatically turns the engine off when a vehicle stops, then restarts the engine when the driver takes his foot off the brake. A stop-start feature can produce a 5-per-cent fuel saving by essentially eliminating idling.

The Mini Cooper sold in Europe offers stop-start and it is expected to make its way to Canada in the future. Mazda is likely to offer stop-start next year on some models.

Meanwhile, cylinder deactivation systems have been around for years. They shut down some cylinders when they are not needed by stopping the flow of fuel to those cylinders. So, eight- and six-cylinder engines can operate in a four-cylinder mode, for instance.

GM, Chrysler and Honda have all pushed this technology into mainstream vehicles such as the Chevy Impala and Honda Pilot. The fuel saving is estimated at about 7 per cent.

Then there is continuously variable valve timing. This technology fine-tunes the operation of valves that control the flow of air and fuel into the cylinders. When and how long the valves open (timing), and how much the values move (lift), affect engine efficiency.

By optimizing timing and lift settings for high and low engine speeds, it is possible to get as much as a 5-per-cent fuel saving. Almost every new engine introduced these days has variable valve timing.

Auto makers also are refining vehicle designs to maximize aerodynamics, thus cutting down on wind resistance and improving fuel economy.

Finally, lighter materials such as plastic and aluminum are replacing heavier steel components to reduce vehicle weight.

All these enhancements and others do not require a massive retooling of auto manufacturing and supplier factories, and they do not need a massive overhaul of our refuelling infrastructure.
None requires rethinking the electric grid, or building battery recharging stations or battery swap centres. None presents the challenge of being supported by a hydrogen refuelling infrastructure. And all these technologies are do-able and affordable.

It's great to dream big, to imagine electric cars, plug-in hybrids, fuel cell cars and the like, but today's reality is less gaudy and eminently practical.

The silver bullet on fuel economy and emissions is not a bullet at all, but a lot of little shotgun pellets that together hit their target to make cars more efficient, less thirsty and less dirty.

So much for the recent winning streak

The streak dies

RTGAM



So much for the recent winning streak that had been promising to put a bullish spin on North American stocks. On Thursday, major indexes handed back most of the gains won during Wednesday's upbeat session and put an end to four consecutive days of higher closes.


The setback will also likely make January a writeoff for the stock market, with just one trading day left in the month to erase substantial losses so far this year.


The Dow Jones industrial average closed at 8149.01, down 226.44 points, or 2.7 per cent. The broader S&P 500 closed at 845.14, down 28.95 points, or 3.3 per cent. The index is down 6.4 per cent this year.


Clearly, investors are willing to do 180-degree turns on financials these days. On Wednesday, they entertained hopes that the U.S. government will soon create a so-called bad bank to absorb the toxic assets of struggling financial firms, leaving their balance sheets healthier and making the companies more likely to lend money.


On Thursday, a report showed that new-home sales plunged 14.7 per cent in December, dashing hopes for a recovery in the devastated U.S. housing market - which is key to stability in the financial sector. As well, tumbling durable goods orders suggested that the demand for big-ticket items continues to crumble


Needless to say, financials led the selloff, with Bank of America Corp. down 8.3 per cent and Citigroup Inc. down 7.4 per cent. Wells Fargo & Co., which had surged more than 30 per cent on Wednesday, sank 11.4 per cent on Thursday.


However, the selloff was widespread, with 27 of the 30 names in the Dow falling. General Motors Corp. fell 7 per cent after Ford Motor Co. reported a fourth-quarter loss of $5.9-billion (U.S.)., General Electric Co. fell 5.8 per cent and Pfizer Inc., which recently made moves on Wyeth in a $68-billion deal, fell 2.1 per cent.


In Canada, the S&P/TSX composite index closed at 8762.76, down 143.47 points, or 1.6 per cent. Financials were among the biggest drags on the index, with Manulife Financial Corp. down 6.1 per cent, Toronto-Dominion Bank down 5.7 per cent and Royal Bank of Canada down 4.3 per cent. Energy stock were also generally weak, despite the price of crude falling only slightly, to $41.44 a barrel. Suncor Energy Inc. fell 4.1 per cent and EnCana Corp. fell 3.6 per cent.


Among the winners: Gold producers surged, following a spike in the price of gold to $906.50 an ounce, up $16.50, as investors sought refuge from the rest of the stock market. Barrick Gold Corp. rose 7.2 per cent and Goldcorp Inc. rose 6.9 per cent.

Copyright 2001 The Globe and Mail

No bad news here

Click Here For The Full Report

www.stochz.net/pescod28.pdf

No bad news here



Investors weren't in any mood Wednesdy to hear about the negative forecasts of the "experts," but were more than happy to buy stocks in anticipation of big stimulus cheques and bailout plans, sending North American indexes sharply higher.


The International Monetary Fund released its latest forecast for global economic growth, shredding earlier projections of a modest downturn and incorporating a new vision of real trouble ahead. The U.S. economy is now projected to contract by 1.6 per cent in 2009, as against an earlier forecast of a decline of 0.7 per cent. For Canada, the new forecast is for a contraction of 1.2 per cent, down from 0.3 per cent growth. The global economy is expected to slip deeper into recession.


Meanwhile, the U.S. Federal Reserve ramped up the grim talk in its latest monetary policy statement, released in the afternoon.


"Information received since the committee met in December suggests that the economy has weakened further. Industrial production, housing starts, and employment have continued to decline steeply, as consumers and businesses have cut back spending," the Fed said. "Furthermore, global demand appears to be slowing significantly."


You wouldn't know it from stock market moves, though, which instead reflected hopes for a $900-billion (U.S.) stimulus package from the U.S. administration and the creation of a "bad bank" to absorb the toxic assets of struggling U.S. financial firms.


The Dow Jones industrial average closed at 8375.45, up 200.75 points, or 2.5 per cent. The broader S&P 500 index closed at 874.09, up 28.38 points, or 3.4 per cent. It was the index's fourth gain in four trading days.


Financials were the big winners for the day. Wells Fargo & Co., which reported a loss of $2.55-billion in the fourth quarter but said its dividend was safe, surged 30.9 per cent, JPMorgan Chase & Co. rose 10.4 per cent and Bank of America Corp. rose 13.7 per cent.


In Canada, the S&P/TSX composite index closed at 8906.23, up 146.60 points, or 1.7 per cent. There, financials also stormed higher on the premise that some degree of risk surrounding the sector was about to be lifted, thanks to moves in the United States. Toronto-Dominion Bank rose 6.7 per cent and Bank of Nova Scotia 5.3 per cent.


Energy stocks were mixed, after the price of crude oil rose 58 cents, to $42.16 a barrel. EnCana Corp. rose 4.9 per cent and Talisman Energy Inc. rose 1.3 per cent, but Canadian Oil Sands Trust slipped 3.3 per cent.


Gold producers did not fare well, with the price of gold falling to $888.20 an ounce, down $11.30. Barrick Gold Corp. fell 3.5 per cent and Goldcorp Inc. fell 4.6 per cent.

Copyright 2001 The Globe and Mail

Houses QEC,CRO,TLM + 200k Cross

A solid base is forming for QEC at 1.60

The longer the base the faster the race to the previous highs

Pent up demand will explode on positive results

from the ongoing drilling by TLM and Forest Energy

Research Cap 200k Cross

2009-01-27 09:32:32
1.62
0.02
200,000
83 Research Cap
83 Research Cap
K

Cro gathering an audience yet again for - a run to .25-.30 cents this year!

- This company has connections to very well funded mining operations through decades of experience. I believe Mr. Tyler when he says they are speaking with 5 strategic partners for completion of there project through joint ventures. Joint venture speculation could drive our sp into a frenzy.

- The drill program which comprised our 253 million dollar property is open at depth and further drilling could significantly increase the resource. Some of our strongest results were on outer edges of the drill zone. De-watering of the 2500 meter mine shaft will allow them to get at these areas. The intersection I speak of is the 7% nickel over 5 meters that intersection comes from the end of the drill core. Further exploration could offer up amazing results. 0 summer 2008 drill results out, any significant finds in mine ready atikocan or kenora/dryden properties will lift stock.

- The company has contractual agreements with Opiwica explorations (OPW) on the TSX.V to mill there major gold and copper find with in close proximity of Canadian Arrows Planned site. Mining could begin on both projects in early 2010. This represents earnings and is a good partnership for a company seeking to be the next significant Nickel Copper producer in Canada.

- Canadian Arrow has the ability to produce nickel in its mine at 3.47 per pound nickel. That kind of number is unheard of in comparison to other mines. With production scheduled for early 2010 (around the same time our economy should be significantly rebounding) what if nickel prices return back to 15 dollars per pound? This site will look like a gem to any investor! (plus the property would be worth about 400mil at 15 dollars per pound nickel.

This is just a few of the key points that I believe make this company look attractive. If my predictions are correct we will see a significant rebound to normal multiples over the course of the next couple of months and with any significant news pertaining to my points and our sp and volume will be sent soaring. JV with cash on the books and abilitiy to help put project into production will send our sp back to .50 if not higher! I am Bull on Canadian Arrow mines.

Source

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http://www.chfir.com/CRO_Valuation/CRO_ValuationReport.pdf

QEC Trend Reversal To The Upside