Canadian Natural Resources (NYSE:CNQ) is focusing the majority of its capital in 2011 into developing various oil properties in North America. These assets include an extensive number of light oil opportunities across the company's portfolio.

TUTORIAL: Commodity Investing 101

Light Oil
Canadian Natural Resources has allocated $544 million in 2011 to develop light oil properties in North America. The company plans to drill 159 wells during the year and produce between 54,000 and 58,000 barrels of oil per day in 2011. This would be 15% growth compared to 2010 and includes the company's production of natural gas liquids as well.

Canadian Natural Resources will put approximately $500 million in capital into light oil projects annually over the next five years and is targeting annual production growth between 3 and 15%.

Canadian Natural Resources estimates that it has gross proved and probable light oil reserves of 150 million barrels, along with another 83 million barrels of natural gas liquids.

Canadian Natural Resources plans to develop the company's light oil assets using secondary and tertiary oil recovery methods along with horizontal exploitation of conventional and unconventional formations.

Canadian Natural Resources has more than 100 existing water flood operations and uses this method to recover additional oil from its properties. The company also injects carbon dioxide and alkali surfactant polymer (ASP) into wells to recover additional oil.

Canadian Natural Resources plans an ASP operation at the Grand Forks project with initial work in late 2011, followed by injection in the third quarter of 2012. The company also has one carbon dioxide flood under way and another planned on its properties.

Other Players
Another company conducting an ASP operation is Rex Energy (Nasdaq:REXX), which is conducting a pilot program at the Bridgeport Field in the Illinois Basin. The company recently reported increased oil flow at several of its wells in the program.

In the Rocky Mountains region, Resolute Energy (NYSE:REN) is involved with carbon dioxide operations at the Aneth field in Utah. Denbury Resources (NYSE:DNR) is also active with carbon dioxide operations in North America and has properties in both the Gulf Coast and Rocky Mountains regions.

Horizontal Light Oil
Canadian Natural Resources plans to use horizontal development on its conventional and unconventional assets. The company plans to drill 100 horizontal wells in 2011 on various properties in Canada.

One area the company is pursuing is the Spearfish formation at the Pierson project. Canadian Natural Resources has already drilled 14 wells here and has 126 future locations to drill. The company is also working to develop the Cardium and Baldonnel formations on its acreage.

The Bottom Line
Canadian Natural Resources has devoted most of its capital in 2011 towards oil development, and is working on various light oil properties across the company's inventory. (For related reading, also take a look at How Does Crude Oil Affect Gas Prices?)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Stock Analysis

    3 Resilient Oil Stocks for a Down Market

    Stuck on oil? Take a look at these six stocks—three that present risk vs. three that offer some resiliency.
  2. Economics

    Keep an Eye on These Emerging Economies

    Emerging markets have been hammered lately, but these three countries (and their large and young populations) are worth monitoring.
  3. Stock Analysis

    Is Pepsi (PEP) Still a Safe Bet?

    PepsiCo has long been known as one of the most resilient stocks throughout the broader market. Is this still the case today?
  4. Investing Basics

    Learn How To Trade Gold In 4 Steps

    Trading spot gold or gold futures, equities and options isn’t hard to learn, but the activity requires skill sets unique to these markets.
  5. Economics

    The Effect of Fed Fund Rate Hikes on Gold

    Explore the historical relationship between interest rate increases and the price of gold, and consider what effect a fed funds rate hike might have on gold.
  6. Investing

    The ABCs of Bond ETF Distributions

    How do bond exchange traded fund (ETF) distributions work? It’s a question I get a lot. First, let’s explain what we mean by distributions.
  7. Investing

    Latin America’s Economic Forecast

    After a ten-year run, the economies of Latin America are in a decline. For sustainable, long-term growth, the region needs structural reforms.
  8. Savings

    Easy Ways to Go Green and Stay Budget Friendly

    Social entrepreneurs recruit "skeptics" to team green, by providing economically efficient products and services that minimize consumers' carbon footprint.
  9. Investing

    Top Investment Banks In The Energy Industry

    Many global Investment banks are highly involved in the energy industry, but there are also some smaller banks and boutiques that are strong players.
  10. Stock Analysis

    3 Stocks that Are Top Bets for Retirement

    These three stocks are resilient, fundamentally sound and also pay generous dividends.
  1. Does working capital measure liquidity?

    Working capital is a commonly used metric, not only for a company’s liquidity but also for its operational efficiency and ... Read Full Answer >>
  2. How do I read and analyze an income statement?

    The income statement, also known as the profit and loss (P&L) statement, is the financial statement that depicts the ... Read Full Answer >>
  3. Can working capital be too high?

    A company's working capital ratio can be too high in the sense that an excessively high ratio is generally considered an ... Read Full Answer >>
  4. How do I use discounted cash flow (DCF) to value stock?

    Discounted cash flow (DCF) analysis can be a very helpful tool for analysts and investors in equity valuation. It provides ... Read Full Answer >>
  5. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  6. What is the formula for calculating compound annual growth rate (CAGR) in Excel?

    The compound annual growth rate, or CAGR for short, measures the return on an investment over a certain period of time. Below ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!