I’m taking 4 days off before Christmas, and it’s almost going to kill me – there is so much happening in the oilpatch!  The subscribers’ portfolio is heavily weighted towards the new Cardium oil play in Alberta, and I read this morning that one brokerage firm just dramatically raised targets on two of our picks.  The Cardium play has now become the hottest oil play in Canada.

My portfolio addition this week came to me as I was reading a research report on Tuesday morning, and it said Company X had a large Cardium land position.  This is one of the most followed junior producers in Canada, and one quick look at the stock showed that this was not priced into the stock – so I quickly alerted subscribers.  The stock is now up 15% and analyst updates are pouring out touting the latest Cardium play.  I expect this company – with one of the most respected junior teams in Canada – to provide subscribers with great growth in 2010.

I’m also looking at a US listed oil producer that is likely to double oil production – in the next 4 months!  The only issue is its rather large debt position.  There is also an international play – where subscribers have done incredibly well with companies like Petrominerales, and Pan Orient – that has me very intrigued.  It’s well cashed up and has two plays – one for 2010 and one for 2011 – that could see it be a 3-5 bagger or better over the next 24 months with drilling success. (And one of their first wells is twinning an old one that already hit the payzone!)

In the public blog, I am working on a story that will clarify for investors how technology really is increasing valuations (stock prices).  I have a senior Calgary oil executive walk us through how the NPVs (Net Present Value) of wells is increasing.  It’s because of the better production rates being generated with horizontal drilling and fracing.  He tells us how he decides what he’ll pay for an acquisition – how much per flowing barrel, how much for the land.  It gives a good insight into why we are seeing valuations moving much higher right now.

I also will look at IP rates – Initial Production rates.   They can be very misleading for investors, as the decline rates on these new tight oil and gas plays – shale gas, etc – are high (like 50-80% – which is a big variance).  And there are no standards anywhere that say companies should report on 12 hour tests, 3 day tests, 30 day tests etc.

How do you balance the public’s right to know how successful a well is versus having an accurate idea of what the production will really be, after the initial big declines are over.

God Bless, Have a Merry Christmas and I’ll be back in a few days.

PS – You can read my interview with The Energy Report.com at http://www.theenergyreport.com/pub/na_u/1266 – and follow the links to prosperity!