. . .
It stands to reason that companies involved in the repair of oil facilities on the Gulf coast will have plenty of new work. While some of that new business has already been built into the stock prices of those companies, the further effects of Rita are yet to be seen as the storm looms toward the Texas coast. Companies involved in repair include
Oceaneering International (NYSE: OII), which inspects and repairs underwater infrastructure of oil facilities and Global Industries (Nasdaq: GLBL), a rig repair company. Oceaneering recently authorized approximately $40 million in a variety of new capital projects, of which $20 million is anticipated to be spent in 2005. The company stated it was making these investments in "response to the escalation in market demand for the niche market products and services we provide."
. . .
Open the spigots. Hurricane Rita has caused a slowdown in natural gas facilities in the Gulf Coast, so look for natural gas producers like Chesapeake Energy, which were not affected by Rita, to further rev up production.
. . .
Refineries Rule. While all sectors of the oil business have been up, refineries have risen the furthest. Some cooling had been expected in the Fall, but Katrina's rampage has changed the game, and the refinery earnings boom looks like it will go into extra innings, extending for another year. While
Valero's (NYSE: VLO) price is over 100, refineries with room to grow into the century mark include
Frontier Oil (NYSE: FTO),
Holly Corp (NYSE: HOC), and
Tesoro (NYSE:TSO).
. . .
Dune in the Bayou -
Dune Energy (AMEX:DNE) has entered into a participation agreement with American Natural Energy Corporation (ANEC) (Vancouver:ANRU.V). Dune will acquire certain exclusive exploration and development rights in ANEC's Joint Development Agreement with ExxonMobil, covering approximately 11,000 contiguous acres in St. Charles Parish, Louisiana (the "Bayou Couba Field''). The Bayou Couba Field has 30 potentially productive sands. Preliminary analysis indicates numerous hydrocarbon traps at depths ranging between 4,000 and 20,000 feet.
ANEC reported that damage from Hurricane Katrina was minimal and that production has resumed. And
Parker Drilling (NYSE: PKD), a Houston-based, global energy company specializing in offshore drilling, had no structural damage to its rigs in the path of Katrina.
. . .
Underwater contract -
ENSCO (NYSE:ESV) has entered into a drilling contract with a consortium of three independent oil companies to provide a new ultra-deepwater semisubmersible drilling rig, to be named ENSCO 8500. The aggregate revenue expected to be paid under the contract during the four-year primary term is approximately $385 million, which includes approximately $20 million payable upon delivery of the rig.
From:
InvestingIN Oil and GasMore on
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To read about the potential of Canada's Oil Sands region and the stocks that can benefit, read the article:
The Biggest Oil Opportunity in the World - and how you can profit from it
