Madharry, I'm still looking to find the shale plays for 2012-2013. Right now I'm guessing Alberta Bakken and Canadian Cardium and thus the e&p stocks related.
Reiterating my opinion, for 2010 it's Bakken (USA Bakken), going into 2011 it's Niobrara with Bakken doing well too. Bakken's getting pretty recognized, Niobrara following. (If somebody studies Bakken, they eventually come across Niobrara reports now too.) Niobrara's not much proven -- as companies report results, Niobrara small e&p oil stocks will rise further. Jmo. Meanwhile Bakken drilling continues to indicate there's lots of oil (it seems to me), and e&p oil stocks should - I hope - continue to do well. Decline rates for some of the wells are quite hyperbolic though, so that's a caution.
I find making the value case for some of these e&p stocks somewhat iffy using either npv or on acreage controlled per share. Nevertheless, I am adding to stocks held, and I am actively seeking new candidates.
As I've stated before, I am guessing that e&p companies that are involved in two or more shale plays might be a better bet for me than single play players. If drilling in one shale area isn't successful, maybe drilling in another different shale might be successful for the company, so maybe the failure, even if it tanks the stock, won't keep the stock from recovering.
Popular stocks on the internet which have two or more areas are SDCJF, SSN, MHR. And these stocks are doing well, and I hope will continue to do so. I've no courage to add to positions now.
Stocks that I am adding to now (today) are:
EOG. (Adding just a few shares to a few I hold) EOG first mover with large positions. A relatively big company with large holdings. Bakken and Niobrara.
Arsenal Energy (AEI.to/AEYIF). In an earlier post I stated I could see somebody actually getting rich if they bought one or more of these e&p shale companies. AEI.to could be one, imo.
I intend to accumulate a full position. (Not that I expect to get rich on the stock -- that might be for somebody else. I don't know enough, or have courage enough to bet enough.) Arsenal has several things going for it that I like:
1. It's 75% oil/gas
2. It's in N. Dakota Three Forks Bakken
3. It's in a couple of other shales (Central Alberta for light oil)
4. My notes say, "3300 boe/d exit rate '11; 85% oil". This means by my reckoning, the stock -- if the company meets '11 goals -- is or will be cheap (undervalued) based on a flowing barrels evaluation.
5. This is a stock to get into before the crowd, if somebody were interested in that. (I find I am.) Search SI--- there's no discussion of this stock. On the internet threads that are chockablock full of SDJCF, SSN, DEJ, BEXP, MHR -- I did not find any discussion/recommendation of Arsenal.
TriOil Resources (TOL.v/TRIAF). Starting a small buy.
1. For its size it has a lot of Alberta Cardium land under its control. "TriOil has the largest leverage to the Cardium in
terms of net acres versus market capitalization", compared to its competitors, the company says.
2. My notes show TOL.v production is 45% oil. Like most e&p companies, they'll be emphasizing oil production now.
3. Additionally, the company has holdings in Sanish/Three Forks Bakken of SE Saskatchewan. (There's also a gas play and a conventional oil play with TriOil. These two I ignore.)
trioilresources.com
4. Again, not a well-publicized stock, as far as I can tell.
Adding shares of other small e&p companies today as well; I've run out of energy to write these up now though. |
