Canadian Oil Sand Trust (COS.WF) report of Q1 results demonstrates the power of higher oil prices to leverage its cash flow.  Based on an average WTI price of $97.82, up from $58.23 in 1Q07 (+68%), operating cash flow rocketed ahead 119%, to C$0.98 vs. C$0.42 per share despite plant outages that caused unit sales to fall by 9%.  

The company’s decision to boost its quarterly dividend by 33% to C$1.00 per share demonstrates its confidence in the continuation of strong cash flow.  Since the company cannot control the price of …

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An extensive research report published in the Globe and Mail discusses the importance of water to extracting oil from the oil sands.  A key assertion is this: ” The degree of water use directly reflects the quality of ore recovered, says Bruce Peachey, president of New Paradigm Engineering in Edmonton. “We are presently mining the best ores. But as clay content increases, the volume of water needed in production will increase. So this is the good time for water.”

Water may well be a limiting factor in the growth of oil …

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March 10, 2008 at 10:17 AM EDT CALGARY — — Canadian Oil Sands Trust [COS.UN-T] said recoverable resources at the Syncrude oil sands project amounted to 12.7 billion barrels, up from prior estimate of 9 billion. The increase in estimated recoverable resources “reflects the reporting of a new category, known as prospective resources, as well as mine pit design criteria that expand the pit sizes in some areas, consistent with the current business environment,” the company said Proved plus probable reserves were 4.9 billion barrels, largely unchanged …

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2008 Thus Far: A Preview of Coming Attractions

My concern has been that at some point shortages of oil will cause a falling-stocks, rising-oil phenomenon that will crush my oil related stocks along with the whole market. 2008 has started like that. Oil was up 6.34% as of 2/29 (per the ETF symbol OIL) but stocks were down 8.5% (in terms of the S&P 500 ETF symbol SPY). For oil-related stocks, the falling stock market trumped the rising oil market, as I have expected. IYE, a broad-based oil-stock ETF, was down …

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Canadian Oil Sands Trust (“Canadian Oil Sands”) today discusses the impact of Crown royalty changes for oil sands projects announced yesterday by the Alberta government. read full article

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Suncor Energy Inc. (SU) and Syncrude Canada Ltd. have individual royalty deals with the government of Alberta, which set the two oil sands giants apart from the rest of the industry read full article

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Canadian Oil Sands Trust (COS) owns 36.74% of Syncrude, Ltd, one of the largest and most developed oil sands operations in Canada. Sycrude has a record of profitability and has already achieved construction of the bulk of its long term capacity goals, including in July an upgrade that increased output capacity by 40% to approximately 350,000 barrels per day, or about 129,000 for COS. A de-bottlenecking upgrade will add another 50,000 b/d to capacity in five years and a final planned expansion will bring production to 500,000 b/d in about …

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Oil Price Expectations Rise…

But Inventory Levels Rise Too.

Two Ways to Cure Oil Dependency…

And Two Ways to Gain from $100 Per Barrel Oil

The steady march of oil from $50 per barrel to over $70 since January seems to have broadened and strengthened the confidence of oil bulls. As the price advances, there is also more frequent and widespread discussion of Peak Oil, a principle underpinning of price bullishness. The kind of dramatic talk one can hear these days is illustrated by the following from Kurt Wulff, the respected chief of McDep Associates:
“As for one of the fundamental factors behind oil’s price rise, Mr. Jim Buckee, retiring Chief Executive of Talisman Energy (TLM), showed a hand-drawn graphic to a small group at the end of the day illustrating a recent accelerated decline in production of the world’s largest oil field, Ghawar, despite a parabolic increase in oil field equipment and service spending by Saudi Arabia.”

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