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Taylor: Is there any company in particular in the areas that they're operating in that provided a good blueprint for what SandRidge could possibly do to right the ship a little bit?

Joel: There's two bigger companies. One company that I like for 2013 going forward, and one company that's really been one of the best-run companies in the oil industry. The best one is EOG, and the company I like is Devon.

They were also natural gas heavy. They had to find a way to move into oil, and what they did is they stayed focused, they stayed within their balance sheet, and they slowly built out high quality assets, would explore those, and then use internal, organic growth.

EOG has done that. They've done very well drilling for the oil. They've also been really innovative in creating ways to make some of their best plays, like their Bakken assets, where they created the railroads.

Also, the Bakken is one of the most expensive to drill. They went out and bought a sand mine, which is a big expense for hydraulic fracturing. It basically cuts off a million dollars per well. They're drilling more cheaply, they're moving the oil to Louisiana where they're getting a $20-$25 additional price this year, which is huge for them.

Devon Energy is a company very much like EOG. They're growing at a very good level. Their balance sheet, they have $7.5 billion in cash. They still have a lot of natural gas, but they're moving into liquids. Their liquids growth is very nice.

They're getting liquids from Canada, which basically there's not a whole lot of costs for exploration, because you know it's there, you just have to go and mine it. They're getting the liquids and they're not having to spend too much money trying to search for it.

They're growing at that right pace, where they're keeping their balance sheet, they're creating a lot of oil; 63 percent of their production is natural gas, which is still pretty high, but with natural gas prices slowly creeping up, that could be a pretty good boom for them in the short term.

The article Which Companies' Blueprints Should SandRidge Follow? originally appeared on Fool.com.

Joel South owns shares of SandRidge Energy. Taylor Muckerman has no position in any stocks mentioned. The Motley Fool owns shares of Devon Energy. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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