Friday, February 3, 2012

Megaloads -- XOM Subsidiary -- Montana - Idaho -- Update

Link here.

The Missoulian brings us up to date.

As of December 26, 2011:
As the latest Year of the Big Rigs draws to a close in Montana, it's kind of quiet out there, is it not?

Oh, they're still making noise in Idaho, where Moscow bristles with each new convoy of Imperial Oil/Exxon Mobil megaloads that rolls through town.

And big rigs still rumble through Missoula in the night. Nickel Brothers recently finished moving the last of 23 Alberta-bound loads of Weyerhauser pulp mill equipment down U.S. Highway 12 and up the Blackfoot on Montana Highway 200.

Mammoet and Imperial Oil/Exxon Mobil continue to empty docks at Lewiston, Idaho, and Pasco, Wash., of those large and controversial loads of processing equipment for the Kearl Oil Sands in northeastern Alberta. The 205 modules the companies originally proposed to haul over the same two-lane route that Nickel Brothers followed have been sliced and diced to something close to 300 loads.
And so it goes. The chronology here.


  1. embraceyourinnerhillbillyFebruary 4, 2012 at 2:05 AM

    G’Day Bruce,

    I’d like you to consider the following as a topic to encourage discourse.
    As always, this isn’t for investment advice (I’m certain I’ve read somewhere MDW isn’t an investment site), just for a reading of the collective pulse regarding P/E ratios and their meaning.

    EOG - 27.97
    KOG – 47.85
    NOG – 37.74
    CLR – 28.07
    OAS – 31.07
    WLL – 11.86????

  2. I'll take that under advisement. In established and mature sectors, p/e's seem to be a good datapoint when comparing "like" companies that are also mature.

    The Bakken is neither established nor mature; it is still a growth story, but one with an EPA sickle hanging over it. Of the six companies listed, one might consider EOG and WLL mature, they've been around a long time. EOG is switching from gas-focused to oil-focused. I don't know much about the history of WLL. CLR has been around a long time, but it's certainly a different company since 2007. Looking back, one almost gets the feeling that Harold Hamm woke up one morning, realized this would be his last hurrah, and threw everything he had into the Bakken (including reputation, chutzpah, bragging rights), and, luck was with him. NOG, too, has been around a long time, but this is a completely different company in the last two years. OAS? Is it even 24 months old yet? It became what it is when it bought MDU/Fidelity assets in the Cottonwood. KOG, like NOG, has been around a long time, but it, too, is a completely different company. For me, their p/e's are snapshots from which I can get no useful information.

    In addition, these all have different business models and/or strategies. NOG is most unique. OAS and KOG are similar, but OAS seems to be stepping out. I think 2012 will be a watershed year for KOG: huge breakout, or it stumbles. WLL is my favorite of those listed because of its very interesting business model: Northern OPS and Southern OPS in the Bakken.

    For me, the number one metric is cash flow. Unless a company like KOG or OAS makes a huge acquisition, it would be concerning to me if either had to raise case by issuing more shares to execute their current plan.

    The second metric is, of course, the price of oil, of which nothing needs to be said. Any pullback in the price of oil only offers opportunities; the long term trend is up.

    The third metric is year-over-year increase in daily production, perhaps vs what the company forecast

    This is just "Economart Saturday morning rambling" -- not much thought put into it, but just what came to mind immediately.

  3. embraceyourinnerhillbillyFebruary 5, 2012 at 12:11 AM

    I'm curious if the P/E has any bearing on a true valuation at this point. Either WLL is selling at a steep discount, or the others are way over-priced. I'm curious as to how others see it.