Wednesday, September 5, 2012

EOG's Papa Believes There Are Only Two Significant Tight Oil Plays

Beware of companies promoting "liquids" growth!

Something big has happened in the oil business in North America. After decades of declining oil production, the United States is now actually leading the world in oil production growth. The key to this turnaround is, of course, horizontal drilling with multistage fracturing, which has cracked the code when it comes to recovering oil trapped in tight rocks that had previously been unrecoverable.
As an investor, I've been trying to profit from this "unconventional revolution" by owning shares of companies with large land positions in these emerging oil plays. In my opinion, the stock market is greatly underestimating the value of those acreage positions and the ability of these companies to grow cash flow for decades to come.
Today I listened to a presentation from Mark Papa, who is the CEO of EOG Resources (EOG) -- the leader in unconventional oil production in the United States.

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