Monday, September 6, 2010


With the recent BP spill in the Gulf and the subsequent Mariner Energy owned platform that erupted into flames (without any oil spill though), this may leads one to think about the possibility of the US enacting a temporary ban of all offshore oil exploration in the US. If this is so, it will surely affect Keppel Corp, who is the world leading builder of oil rigs. I ponder on the likelihood recently.

But, I read the following statistic. There are about 3400 platforms operating in the Gulf according to the American Petroleum Institute. Together, they pump about one-thirds of American domestic oil. Given the American addiction on oil to lubricate and run the economy, I do not think a ban is possible, albeit a temporary one. Just witness how fast the BP spill is fading away from the daily news radar.

It is extremely difficult for a Singaporean company to be the leading player in the world in their core business. Keppel Corp is one of the rare few.

With the recent government recent cool down actions on property demand which causes a knee-jerk downward pressure on Keppel Land, and ultimately Keppel Corp share price, I thought it was an opportune to vest in Keppel Corp.
I vested at 8.74 and intend to hold it for quite a while. I miss out investing in Keppel Corp in 2009 when the price was much lower due to my indecisiveness.

I did not do a detailed analysis on the B/S, Income Statement nor CashFlow Statement as I do have some implicit faith in how Keppel Corp run their business. I need to revisit it sometimes.

I do not always do analysis before I vest. Sometimes quality blue chip, I just monitor the price for a long period of time and take action based on gut feel.

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