Long Run Explor Ltd Ord WFREF

RE:However

[JonCom]

Buying into the oil sector at this time is very risky, but will also yield a high return if you invest wisely. I made the mistake of getting into LRE because I believed the downturn in oil would last a year at most, however, with the way the current events are happening over the world, I do not think oil will recover anytime soon. If you are to risk investing in the energy sector, it is best to stay with blue chip companies or large companies well poised to weather the price environment. In my opinion, out of the canadian players, CPG, SU, BTE and WCP are the big boys, but I am personally picking CPG out of them.

At 25K invested, my return is almost 2700$/year in dividends. Id say 4-5 years to recoup my losses on LRE. If the div gets cut or eliminated obviously my plan is blown out of the water. However, plan to hold for 5 years, oil will go up.

Why will it go up?

Because small producers will go bankrupt in this environment. Bankrupt or bought out. Only the big boys will survive. LRE cannot afford to survive for 3-5 years. They have too much debt. The more small cap producers that go under, the less oil on the market. Less oil, less supply... price creeps up.

CPG is attractive right now. LRE is not.