Tickers in this Article: OXY, XOM, EGN, CHK, XTO
The energy industry is a dynamic one that is full of surprises, and 2010 should be no different. Here are four possible surprises for 2010 in the Energy sector that may reward investors.

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California, Here We Come
During 2009, Occidental Petroleum (NYSE:OXY) reported finding a new oil and gas bearing conventional formation in the Kern River field in California. The company was not very forthcoming in telling the investment community about the potential of this new play, either due to strategic reasons or because of the unknowns regarding any new find.

The company did say that reserves in this new field are between 150-250 million barrels oil equivalent (BOE) on the six well test area that it drilled. If Occidental Petroleum finds that this formation runs throughout some of its 1.1 million acres in the state, the field has huge potential.

Horn River Shale
A few months before Exxon Mobil (NYSE:XOM) announced its purchase of XTO Energy (NYSE:XTO), Exxon Mobil was starting to develop the Horn River Shale in British Columbia. It's not clear how much capital Exxon Mobil will devote here now that it has the shale drilling inventory of XTO Energy to exploit, but a possible surprise in 2010 might be a major well here with an incredible initial production rate.

Chattanooga Shale
The Chattanooga Shale has taken a backseat to many other domestic shale plays in North America, but Energen Corporation (NYSE:EGN) is currently completing a well here to test the shale. The company is obligated to do this as part of its agreement with Chesapeake Energy (NYSE:CHK). If Energen Corporation has a successful well with a high initial production rate, it might kickstart development in the Chattanooga Shale.

Reserves Chaos
The energy industry is coming under a new set of rules regarding reserves, and will use these when reporting end of 2009 reserves sometime in the first quarter of 2010. The new rules allow possible and probable categories of reserves in official filings, booking oil sands as reserves, and using end of month average prices instead of the end of the year prices.

Exploration and production companies are also being given extra latitude on what reserves go into the proved category. These new rules are sure to cause chaos early next year, and impact reliability and comparability to prior years.

The Bottom Line
One way to make money in investing is to make a bet on something that the bulk of investors are not expecting. This may be riskier, but will surely lead to a higher return. (To learn more, check out Oil And Gas Industry Primer.)

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