BOSTON ( TheStreet) -- Turmoil in the international oil market is a boon for North American energy.That's particularly true for companies that own oil-shale and oil-sands properties, and those that provide oil-field services used in exploration and production. Shares of companies in the oil and gas drilling industry have jumped 23% this year, the third-best sector performance of 148 tracked by Morningstar. Oil and gas equipment services is up 11%, ranking 18th. The S&P 500 Index has risen 4.4%. >>Bet on Oil, Stocks Moving in Lockstep Big inflows into the sector are due to bets that homegrown oil will replace some foreign oil sources as international prices top 2 1/2-year highs. The escalation of political turmoil in Libya, which has about 2% of the world's known oil resources, has propelled the cost of crude. Oil and natural gas resources in North America are huge, but extraction is expensive since it has to be removed using high-pressure blasting of water and chemicals from rock and sand formations. In contrast, oil in much of the Middle East is extracted by traditional drill-down methods. >>Goldman, Barclays Square Off on Oil, Stocks So there is new investor interest in exploration firms, oil-rig suppliers, drilling contractors and companies that provide material and technologies used in freeing oil and gas from North American deposits, as well as companies that have bought up drilling rights to properties with those deposits. Indicative of the frenzied interest in North America's oil-shale deposits, PetroChina ( PTR) paid $5.4 billion to buy a Canadian project from EnCana ( ECA) last month, while ExxonMobil ( XOM), already the largest U.S. natural gas producer, said in January that it's on the prowl for new properties. >>5 Solar Stocks Topping Performance Lists Here are five companies in various parts of the industry to consider as investments:
Abraxas Petroleum ( AXAS) explores for and produces crude oil and natural gas, primarily in the Texas and Wyoming region. It is a developer of oil-shale properties. In 2009, the company earned 16 cents per share. Analysts estimate that it will earn 2 cents per share when 2010 results are reported and that that will rise to 22 cents per share in 2011. Institutional ownership is at about 50% of outstanding shares. The largest investor is Third Point LLC, followed by ClearBridge Advisors. Analysts give its shares six "strong buy" ratings, one "buy" and two "holds," according to Thomson Reuters. Their mean 12-month share price target is $5.78. Its shares hit a 52-week high of $6.16 on March 1 and are up 26% this year. A year ago, the stock was trading for about $1.85.
Cameron International ( CAM) is an international supplier of oil and natural gas processing equipment, including pipeline valve and oil-rig pressure-control equipment, compressors, and other components used in oil and gas production and transmission. The company operates through three segments: drilling and production systems, valves and measurement, and compression systems. The $175 million Integrity Williston Basin/Mid-North America Stock Fund ( ICPAX), which focuses on oil-shale explorers and developers, added the company to its portfolio in the fourth quarter. Standard & Poor's has a "hold" recommendation on Cameron's shares but gives it three stars out of five in its rating system. It projects 2011 earnings of $2.72 per share, rising to $3.20 per share in 2012. Fourth-quarter orders were $1.71 billion, an increase of about 16% versus the third quarter, as demand for oil-well blow-out preventers grew as rig operators upgrade their equipment to meet more stringent government regulations. Institutional investors own 34% of its shares, led by T. Rowe Price, with 6.4%. Vanguard owns 5% and State Street, 4.5%. Cameron's shares are up 19% this year and 43% over the past 12 months. It has a $14.5 billion market value. Cameron's shares hit a 52-week high of $60.89 last week.
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