Athabasca Minerals (ABM-X)

They operate some gravel pits in Fort McMurray and it is a hot commodity there. They also have frac sand. He is hesitant due to a lawsuit with one of their customers. Wait for that to clear up.

This had a monster frac sand deposit, which was very attractive. The demand for frac sand is not going to be great. He got out before the stock fell.

He has a very small position in this. The big business for them is the frac sand market. Most frac sand is being railed in from Wisconsin. Athabasca has a big sand quarry in Alberta where they are doing their preliminary assessment. Strategically located. Has no revenue from this right now. Stock had a big run up as there were expectations of them getting approval for this quarry. Pulled back because everyone is now concerned about the longevity of the energy business and what that will mean for this company. If you have a longer-term time horizon this would be a good entry point. Probably 18 months away, plus they are going to have to do an equity raise for a rail.

Did very well, but has done poorly in the last month. Fortunately, he exited before the selloff happened. They operate some gravel pits in Fort McMurray, and have a frac sand deposit, which is where the bulk of the value was when it was at $3. Frac sand still has a tremendous influence on the stock price. They don’t have enough cash flow to develop the mine themselves. However, he feels it is a tremendous asset if you believe in healthy oil prices.

A really interesting company. Their primary business right now is gravel crushing. They operate a mine for the Alberta government. Numbers came out today and were probably a little disappointing. The real upside with this one is that they have an opportunity to participate in a frac sand market. The majority of the frac sand that is used in Western Canada gets railed in from Wisconsin. They have an opportunity to set up a depot, which will require some capital, so wouldn’t be surprised to see them raising money in the short term. This is where the huge upside is as they will be able to compete on price. The sand won’t be the same quality, but will be satisfactory for most of the frac jobs. He is looking at this one.

Produces gravel and sand. Tar sands mines have gravel roads, and they consume a lot of gravel. The real value is their fracing sand. He is sure there is more upside to come. It will be volatile as it is an undeveloped resource play.

Fracing sand is turning out to be a great business to be in, so you want to go with the actual producer. This gives you a broader base, and is a much simpler way to get into that area. Not a bad area to get into.

(A Top Pick May 25/12. Up 71.67%.) Still buying. Gravel producer in Fort McMurray area. Make nice profits from that, but what really interested him was their frac sand deposit for shale. This deposit is worth a lot of money and they are just waiting to see if the Alberta government is going to require a full environmental impact assessment. He is betting that they won’t. If so, the stock should move appreciably.

Produces gravel in Fort McMurray for the big oil companies. Stock sold off because it got ahead of itself and, as well, people are losing patience with the permitting of the frac sand deposit. If this deposit gets developed, the stock will go a lot higher. Has it as a Hold right now as he wants to see the Q4 earnings.

Makes gravel in Fort McMurray. Thinks this is going to go higher. Have a lot of catalyst waiting for them that could move the stock price up. Have a huge frac sand deposit and are waiting to hear from the government as to whether they can proceed developing at, or if they have to do a full environmental assessment.

Not a fan of commodity players but likes the companies that provide them with equipment, etc. This company sells gravel and oil Sands producers use a lot of gravel. The company returns 45% on equity. Management owns a lot of stock. Trading at around 11X earnings. Literally across the road from Imperial Esso’s (IMO-T) Kearl and will be a big customer for them. Likes this one a lot.