3 Companies Winning in the Eagle Ford Shale
Feb 24th 2013 2:30PM
Updated Feb 25th 2013 12:10AM
In the following video, Tyler Crowe interviews Aimee Duffy and gets her to share three picks with exposure to the Eagle Ford shale formation.
Aimee's first pick is EOG Resources, the largest landholder in the Eagle Ford. With proven reserves of 2.2 billion barrels, this year EOG plans to drill 400 wells and forecasts a profit increase of 28%.
Her next recommendation is not an oil producer. Instead, it's Enterprise Products Partners, a midstream company. Enterprise has spent lots of money in the Eagle Ford, and it's already paying off, as seen in the company's Q4 results for its onshore natural gas pipeline and services segment, and its onshore crude pipelines and services segment.
Aimee's third pick is ConocoPhillips, the nation's largest independent oil producer. (It was a close call between ConocoPhillips and Marathon Oil, she says.) As it sets production records, ConocoPhillips benefits from drilling the cheapest wells in the Eagle Ford. It needs oil prices of only $37/barrel to break even, compared with $40-$80 or $50-$70 for its rivals. She recommends this company to the conservative investor seeking dividends.
The growing production of natural gas from hydraulic fracturing and horizontal drilling is flooding the North American market and resulting in record-low prices for natural gas. Enterprise Products Partners, with its superior integrated asset base, can profit from the massive bottlenecks in takeaway capacity by taking on large-scale projects. To help investors decide whether Enterprise Products Partners is a buy or a sell today, click here now to check out The Motley Fool's brand new premium research report on the company.
The article 3 Companies Winning in the Eagle Ford Shale originally appeared on Fool.com.Fool contributors Aimee Duffy and Tyler Crowe have no position in any stocks mentioned. The Motley Fool recommends Enterprise Products Partners. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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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