wti price

This is pretty interesting read

http://www.hardassetsinvestor.com/weekly-commodity-reports/petroleum-report/3707-crude-oil-report-more-downside-remains-for-over-sold-oil-wti-brent-spread-to-remain-wide.html?showall=&fullart=1&start=7

Seaway pipeline reversal kicking in 17 May for 150,000 bpd and ramping up to 500,000 over time.

WTI has potential to drop back into the 80-90 range (reducing MADs margin). Our premuim becomes a bigger percentage of our margin and a competitive advantage

Less US imports and current over supply by OPEC will pull brent back as well. US is going to be lot less tolerant of Iran.

Lower price all round can help global economic recovery. Given fear of european and US recession, and China slow down at same time next year coupled with Obama re-election, lower oil might be a really good thing.

Iran pushing back in any explosive way would really upset the whole apple cart. Russians getting twitchy about customers self producing or cheaper alternate imports would also change the dynamics but that is probably 3-5 years off unless they wanted to move early and swallow a country or two.

MAD business model of low debt, funding expansion from cash flow and survivabilty down to $40 a barrel oil price is comforting for the global slow down, recession scenario. OPEC pulling back production as US demand drops off will keep WTI about where it is now so that would be great for MAD as it would keep expansion accelerating.

Emerging economies growth and Japan electricity generation substition could help keep global price up, US benefits on relative terms as it can work off lower domestic price as a competitive advantage. That keeps WTI about where it is and MAD profits with strong domestic demand.

If MAD can stay relatively debt free, shift to higher producing wells and have some cash to take advantage of any drop in price in terms of hinderance to local competitors creating cheap infrastructure (rigs) or acerage then this is going to be fantastic earner in up and down cycles.

Biggest risk I see is the age of the owners. If their children are in the business and that's the sucession plan then i can't see them selling out. The longer the continuity of this business model the better for us