29-07-01 Bankers, brokers and investors are heading West to meet the oil and gas companies that search the valleys, mountains and plains for untapped opportunity. The American Stock Exchange is co-sponsoring the annual Oil and Gas Conference in the US for the first time. Fifty of the world's leading deep-gas drillers, exploration and production companies are hoping to attract investors, many who are sceptical about the ability of companies to consistently produce oil and gas.
"There is nothing easy about the oil and gas business," said Frederick Sewell, president of Netherland, Sewell, & Associates of Dallas. "The fundamental is the oil and gas business is a very capital intense business." The independent companies' roles have become increasingly more important with the Bush administration trying to find ways to tap the Rocky Mountains and Western states for more of its abundant oil, natural gas and coal.

Many of these smaller companies know where to look. Barrett Resources, a natural gas provider with holdings in the Rockies, was recently the target of a $ 2 bn hostile bid by the US unit of Shell Group. Williams Cos., a Tulsa, Oklahoma-based energy trader and pipeline operator bought Barrett in June. "These companies are companies that will take the risk and manage resources that are basically not attractive to the majors," Sewell said.

Natural gas prices that peaked at $ 11 per 1,000 cf in January are now hovering at about $ 3. Gas prices peaked around Memorial Day at about $ 1.76. But those higher prices at the gas pump didn't mean more investors were putting money into the oil and gas sector. Most energy stocks didn't outperform the stock market as wary investors kept an eye on the sluggish worldwide economy and increased drilling, which inevitably would mean lower prices.
"Investors look at management teams and take a look at whether these companies are capable of growing or expanding," said Greg Barnett, president of EnerCom, one of the sponsors of the conference.