CNOOC Limited (CEO - Free Report) -owned Nexen Energy recently announced its intention of spending C$400 million (more than $300 million) to enhance its Long Lake oil-sands project, located in northern Alberta. The decision marks an improvement in Canada’s oil-sands industry, which had witnessed several foreign direct investments flying away from the projects.
Nexen Energy, bought by CNOOC in 2013, plans to add oil production of 26,000 barrels per day (BPD) in the Long Lake oil-sands project. The expansion will include the addition of three steam-driven well-pads, which will transport bitumen to the company’s existing facilities. Moreover, the cost of the project is 50% less per barrel than the 2014 standards, marking immense improvement in efficiency of the company.
The oil-sands expansion project is also expected to bring down emission intensity in the Long Lake development and thus complies with the Alberta government’s climate goals.
The expansion project, likely to conclude by 2020, also asserts CNOOC’s long-term confidence in Alberta’s oil sands, denoting a positive sign for the sector. The move can further ignite a resurgence of foreign-direct investments to the Canadian oil-sands sector.
CNOOC, primarily engaged in exploration, development, and production of crude oil and natural gas offshore China, and globally, has gained 50.8% in the past year compared with 27.3% growth of its industry.
Zacks Rank and Other Stocks to Consider
Currently, CNOOC sports a Zacks Rank #1 (Strong Buy). Investors interested in the Energy sector can opt for other top-ranked stocks like Continental Resources, Inc. (CLR - Free Report) , Delek US Holdings, Inc. (DK - Free Report) and HollyFrontier Corp. (HFC - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Oklahoma City, OK-based Continental Resources is an upstream energy company. The company’s top line for 2018 is anticipated to improve 57.7% year over year. In the last four reported quarters, the company delivered an average positive earnings surprise of 80.5%.
Brentwood, TN-based Delek is an energy company. The company’s top line for 2018 is anticipated to improve 39.2% year over year, while its bottom line is expected to increase 293.7%.
Dallas, TX-based HollyFrontier is an independent refining company. For 2018, its bottom line is likely to be up 153%. In the last four reported quarters, the company delivered an average positive earnings surprise of 41.3%.
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