WPX Energy (NYSE:WPX) has completed its separation from Williams (NYSE:WMB), and starts off 2012 as a fully independent energy operator focused on the upstream. The company is geographically diversified, with operations spread across the United States and exposure to Argentina through majority ownership of an operator active in that country. (To know more about oil and gas, read Oil And Gas Industry Primer.)
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Spin-Off
WPX Energy is the former exploration and production business of Williams, which decided in 2011 to separate into separate downstream and upstream companies. Shareholders of Williams received one share of WPX Energy for every three shares they owned of the company. The shares were distributed in the final day of 2011, and WPX Energy began regular trading on January 3, 2012.

Summary
As an independent operator, WPX Energy is among the largest exploration and production companies based in the U.S. The company reported proved reserves of 4.5 Tcfe at the end of 2010, and average production of 1.3 billion cubic feet of natural gas equivalents per day in October 2011.

This makes the company slightly smaller than Southwestern Energy (NYSE:SWN), which reported proved reserves of 4.9 Tcfe at the end of 2010.

The majority of WPX Energy's proved reserves and production are in the Piceance Basin in Colorado. The company also has operations in the Powder River Basin, Mid-Continent area and San Juan Basin in New Mexico.

Production Growth
WPX Energy estimates that total company production in 2012 will range between 1.33 Bcfe and 1.49 Bcfe per day, up from the production of 1.25 Bcfe to 1.3 Bcfe per day expected for 2011.

Unconventional Plays
WPX Energy has exposure to several popular unconventional resource plays including the Bakken and Marcellus Shale.

WPX Energy bought Bakken properties at the end of 2010 and now has 85,800 net acres under lease. The company has completed 22 wells since then and boosted its production from this play to 6,400 barrels of oil equivalent (BOE) per day.

WPX Energy has also been aggressive in the Marcellus Shale and has close to 100,000 net acres under lease across Pennsylvania. The company plans to operate six rigs in the Marcellus Shale in 2012.

Argentina
Although WPX Energy is primarily focused on the onshore United States, the company owns a 69% interest in Apco Oil and Gas International (SMCAP:APAGF), which is active in Argentina.

Apco Oil and Gas International owns non-operated interests in a number of areas in Argentina and Colombia, including properties in the Neuquén Basin in Argentina. The industry is very active in parts of this basin as it explores the resource potential of shale formations found here. Exxon Mobil (NYSE:XOM) is one of these operators and was awarded two concessions in this basin in 2011.

The Bottom Line
Although WPX Energy only recently became an independent exploration and production company, this operator has been in the upstream business for years and has a large portfolio of oil and gas assets in the United States to exploit. The company's exposure to Argentina is also intriguing and should be watched closely as other operators prove up reserves in that country. (For additional reading, check out A Guide To Investing In Oil Markets.)

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At the time of writing, Eric Fox did not own shares in any of the companies mentioned in this article.

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