Cuervo Resources Inc CRVNF

david_pescod July 14, 2006

[rolfoto]

e-mail: [e-mail] July 14, 2006 SHININGBANK ENERGY INC. TR. (T-SHN.UN) $21.16 -0.84 CYRIES ENERGY (T-CYS) $10.72 +0.20 Who would have thought six months ago, we’d be seeing what we see today in the natural gas sector...or what’s left of it. Six month ago, gas was $15 an mcf and the sky was the limit. Coal bed methane was the rage and you couldn’t find a drilling rig no matter what you offered. Today gas is almost a third that price and inventory levels are near record highs and while we may have written about this gas problem several times over the last two months, if you want to get a really bearish viewpoint, go to ROB-TV on July 13th (watch past videos, 10:15 am) to hear Bill Gwozd of Ziff Energy give you the bearish view on gas that could go on for the next three months. Have you ever thought the possibility of gas going to $2.00 an mcf? Oh yes, and that top chart, which shows you where gas prices have gone, it doesn’t show you where costs of production have gone, which are way up! Costs of everything from land, to drilling, to personnel to you-name-it, costs have soared while revenue has gone down. There are many producers that are not having any joy at these prices at all, so no wonder drilling in the natural gas sector is being cut back dramatically. And that’s why all of a sudden folks, if you want a drilling rig, you can find one. In the interim, all sorts of companies have been hurt and hurt big time. Whether it’s a gassy stock like Cyries Energy, Delphi Energy (DEE) or Accrete Energy (GZ), or one of the most gold-plated of income trusts such as Shiningbank Energy, which if you go to their website probably tells you that they are 77% natural gas. Which is great when gas is $15 an mcf. But at this level…. So the question is, how low does gas go and how low does it take the gassy stocks with them before... hopefully...we hit a bottom and then hopefully, head to more reasonable price expectations. Meanwhile, the debate continues about the price disconnect between oil and gas and we note some people suggesting that just maybe it’s permanent.

[Houndtrader]

If you listen to last nights Marketcall with David Cockfield, he had a different view. He was talking about the service rigs, and how they are still booked til next year. He also said gas will probably stay around the six dollar range, and doesn't see it going any lower,in short term.I would guess that most of the gassy stocks would probable be hurting.I read somewhere tonite, oil could hit