Energy Companies Bringing the Utica Shale to Market
As always, some companies utilize some areas more than others. In this case, these select few companies are really using the Utica shale to make a name for themselves. They are creating a strong focus in this shale formation and creating strong exposure in the market place. Matthew Smith explains why these few companies are the select few.
One company which is not receiving its due is EV Energy Partners, LP (EVEP) which we believe is the best play in the Utica for investors seeking both yield and massive capital gains. We think the company has one of best land positions in the play. In fact, when Chesapeake wanted to lock up land for its 1.25 million net acre position, it went to EVEP and locked up land that way. EV Energy Partners has over 600,000 net acres in the Utica and according to our data is the second largest position in the play. EVEP also enjoys the fact that much of its land is held by production (HBP), thus it can develop it at its own pace and not pile on debt to fund exploration.
Gulfport Energy (GPOR), which is not just a Utica play, but a company with mature assets (generating cash flow) and other shale and oil sands plays is another favorite which we suspect will rise further due to its Utica leverage. Gulfport has been on a run as of late, up over 50% since it fell below $20/share. GPOR is focusing on oil in the Utica, and the company is looking to expand its acreage above its current holdings and commitments. GPOR is focusing on the wet gas and oil windows for these additions, not the dry gas window. In early 2012 Gulfport will begin drilling its Utica holdings.
If you are liking the looks of the Utica Shale play, these are a couple stocks that could make you a player. They know what they are doing out there, and will probably be the most likely to use it to their advantage. We are bullish about shale plays, and the Utica Shale is really beginning to gain momentum.
Quotes taken from report by Matthew Smith, Read the entire article here.
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