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Oil. Inventories in the US went up shockingly in the wintertime. Normally you have massive drawdowns on a weekly basis. We had 5.9 million barrels growth in total inventory and we are now at 97.5 days. Normally at this time of year you would be low 90s and, after winter is over (February & March), you would be in the low 80s. Also, we may be facing the fiscal cliff in the US. Near-term price range he expects, would be maybe $75 on the downside and maybe $95 if there is any Middle East ruptures or concerns.

Natural gas. Inventories are at record levels and the supply continues to grow. Demand, however, is growing very rapidly in the US, especially from the electricity side of it. With coal at under $4, natural gas wins the market share. There is quite a bit of demand growth here.

About two thirds of production is oil/liquids and a 3^rd is natural gas. In the 3^rd quarter they produced 329 million a day and they lost on a netback $.03 per unit so 1/3 of the business is not making money. Need to get to $5-$6 ACO (?) prices for them to start making money. BV is $18.92. If you remove goodwill, that is still $14.68 so the stock is very cheap but it does need higher natural gas prices.

All of the names such as Husky (HSE-T), Suncor (SU-T) and this one are very cheap and some are trading very close to BV. Issue is going to be, when do we see natural gas prices turn? Also, in the oilsands projects, costs, ability to expand, shortage of manpower, etc. are bothering the market right now. If we can get some progress on the fiscal situation in the US and more progress on the banking situation in Europe, heading into 2014-2015 he feels we are going to see a decent new economic cycle. But there is more pain ahead of us right now.

Going to be drilling wells in Q1 and Q2. At this time he has $1.50 target, so there is still some upside until we get into that next phase of high impact drilling in Q2 and Q3. Kurds have now increased production, which will be sold by Baghdad but those payments are still not in the hands of the Kurds. Until the market sees there is a very transparent payment processor for receiving revenues, he feels the stock has a Hold on it.

Will be drilling in Q1, hopefully February. This is a very big prize, could be 50-60 million barrels. Going to do another seismic program to define opportunities. Market has been waiting for them to start drilling.

Likes the company. His target is $6 so there is some upside here. Key for the company will be the drilling in Peru that hopefully results in Q1. Continuing to add more results at Moqyeta. Costayaco is still doing very well, but at some point depletion will kick in. Very strong balance sheet but they need another win at the drill bit after Costayaco. Moqyeta has been a nice discovery but not on the size of Costayaco. Potentially, the play they are drilling in Peru in Q1 could be a sizable play of 30-50 million barrels.

Company has been hit by the high and variable costs of the oil sands. It traded at around $23 in 2011. BV is around $26.20 at the end of Q3. Any time you see the stock below BV, it is a fabulous Buy. He would use a low $30 target for the next 6 months.

(A Top Pick Sept 25/12. Down 3.39%.) Still likes the story. Involved in the Montney play and have a number of good wells that have come on. Have to sell some assets to get the balance sheet in better condition for the tough times that are coming. Very cheap. Feels it is in a holding pattern between $1 and $1.75. Buy on dips. Take a 2-year time horizon if you own.

(A Top Pick Sept 25/12. Down 29.21%.) Got massacred because of the India problems and financial issues. Resolved the financial issues with financing that have just been completed. Now drilling a high impact well in Indonesia. This is the 1^st well in their program. 12 month target is $20 but any drillbit success or any movement in India to resolve the pricing could raise his target significantly.

(A Top Pick Sept 25/12. Down 20%.) Involved in 2 high exploration wells. Will be reaching total depth in December. Announced the spudding of the 2^nd well. These are light oil targets and are very large. Have a very large light oil focused land spread in Albania. Also, have conventional natural gas land in France. $55 million in cash on the balance sheet. His target is $0.60. Buy on weakness.

50/50 of liquids and regular natural gas production. Will finish this year with around 23,000 BOE’s a day with a goal of 25,000 next year. Balance sheet is in very, very good shape with only 250 million of bank debt on $500 million line. Cash flow next year should be $1.75 a share. Trading at a discount to BV. Big upside as they begin to execute. $6 target.

Markets. Whatever happens, we are going to continue to be in a low growth economic environment into 2013 and we need to accept that. Whether the driver comes out of the US, out of Europe or out of China, there are some positive things that we can look to in each of those different scenarios. Global growth is going to remain slow and we are going to have to deal with that environment. People need to be very cautious in this environment about precisely what kind of companies they own and what the yield represents. However, they also need to be cognizant of the alternatives to the equity market of very low yielding fixed incomes.

There are headline risks with any of the pharma stocks and this is not an area that he gravitates to despite the fact the dividends are reasonably solid, have been paid for some time, and would likely be paid for some time. Issue for many of the big pharmas is the risk of the shift away to generic drugs and the lack of growth prospects that result from that dynamic.

Had a pretty decent run over the last little while. Pretty good defensive company. Likes the mix of revenues that come from emerging markets. Given the run-up it has had, he would recommend watching it and trying to get it a little cheaper or put only 50% in and add to it when the opportunity arises.