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$78.89 0.68 (0.87%)
7/3/2008 1:00 PM

Royal Dutch Shell CL A (RDS-A)

CAPS Rating:
***

The Company consists of the upstream businesses of Exploration & Production and Gas & Power and the downstream businesses of Oil Products and Chemicals. It also has interests in other industry segments such as Renewables and Hydrogen.

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Avatar bmw201030 (82.34) Submitted: 11/23/06 1:35 PM : Outperform Start Price: $65.91 RDS-A Score: 29.63

Despite the surge in spending on alternative energy, our dependence on oil will not go away for at least the next few decades. Oil demand worldwide is increasing. Royal Dutch Shell has a new process for extracting oil from oil shale of which the US has roughly 2 trillion barrels of which between 800 billion and 1.2 trillion are recoverable. Royal Dutch Shell is currently testing the process in the oil shale fields in the midwest. If the process is approved by the government the US could become the next Middle East.

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Avatar Raichusays (97.02) Submitted: 2/20/07 9:57 PM

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Although we cannot track Canadian markets in CAPS, take a look at Canadian Oil Sands Trust. The "next Middle East" is already happening in Canada, but with "oil sands" instead of "oil shale."

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Avatar BillCoffman (66.47) Submitted: 6/08/07 2:26 PM

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1) The in-situ extraction method pioneered which may be reviewed in the RAND study available online in pdf appears to be far more environmentally friendly than the strip mining method used in the seventies abandoned by the oil companies when oil prices crashed, and combined with serious efforts to ameliorate the effects on the environment (recapture of CO2, finding some use for all that CO2, reclaiming and recyclng the enormous amount of water needed to process the keragen into usable fuel) could make the U.S. a net liquid fuel exporter rather than a net liquid fuel importer over the next century. 2) If that weren't enough, the Air Force has just announced its intention to move to coal-based liquid fuels for all its jets, with the implied premise that commercial jets will quickly follow suit once the process and refineries are in place. 3) The amount of oil shale deposits that could produce would meet 25% of our projected liquid fuel needs for 400 years, reducing global demand accordingly (all demand for petroleum and subsitutes is essentally global, as are prices) so shorter time frames are even more optimistic, 4) The result is buying serious time for clearner and more advanced permanent alternative technologies -- perhaps hydrogen in the long run, or who knows, in a hundred years, fusion. 5) Meanwhile, the distortion our foreign policy interests and national security interests produced by our national vulernability and our allies' vulernability to interuption of middle east petroleum could be substantially eased, and America could begin accumulating soft power again, and once again be viewed as a benign influence in the world. For these and other reasons, I am rooting for RDS to make a serious go of its new process, and for our government to encourage an environmentally sensitive approach to expediting oil shale exploitation. Ken Fisher does a nice job explaining the economics in his book on investing.

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