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Utica Shale Opportunities

Keith Kohl

Written By Keith Kohl

Posted October 9, 2012

You’re distracted — but don’t worry…

You’re not the only one.

If you’ve put a dime in North American oil stocks at any point this year, you’re among the many who are overstimulated by media headlines saturated with news of a resurgence in U.S. oil production.

Nearly all of them have been focused on just two areas: Texas and North Dakota.

The EIA’s weekly oil report might shed some light as to why…

EIA oil production 10-9

The chart allows you to see a large portion of our domestic production increase stems from just three basins.

Most of us will agree the Bakken and Eagle Ford have absolutely dominated the U.S. oil scene. At last count, approximately 310,000 barrels per day were flowing out of the latter. (At this pace, I believe more oil will be produced in South Texas than all of Alaska before next summer’s driving season.)

But the success of these two regions is distracting investors from opportunities that are only now starting show face.

The question of whether or not to even look into the lesser-known shale plays has been an issue for many investors.

However, the USGS recently made things easier for us…

The Utica Shale Play

When the USGS sharply cut its Marcellus estimates in 2011, it caused a large group of hopeful investors grave disappointment. Coupled with extremely low natural gas prices, most of them turned their attention west toward greener pastures.

Back in April, I mentioned higher oil prices would send Marcellus drillers across the Pennsylvania-Ohio border to develop the more liquids-rich Utica Shale.

Last week the USGS gave them reason to move more quickly — at least, that’s evident from their latest assessment in the Utica Shale…

According to the USGS, the formation holds approximately 38 trillion cubic feet of natural gas, as well as one billion barrels of undiscovered, technically-recoverable oil resources.

For the record, the Utica stretches across several states including parts of New York, Pennsylvania, Ohio, West Virginia, Virgina, and Maryland.

Utica Map 10-9

The kicker here is that this estimate is more than likely low-balling the true amount of potential barrels in the play; in 2011 the Ohio Dept. of Natural Resources pinned that number at roughly 5.5 billion barrels of oil.

As companies become more efficient at producing the oil resources from the Utica, the USGS will be forced to reassess the play.

Today I’d like to talk about a clear winner from this bullish USGS report.

Buy Before the Herd

One cliché holds true when it comes to these emerging shale plays: Size doesn’t matter.

Don’t believe me?

Just ask a few of my Energy and Capital readers how they fared with companies like Brigham Exploration, Petrohawk, and even XTO Energy…

Each one of those little companies was part of multi-billion-dollar deal with major oil companies.

And the same will hold true for the Utica.

A list of of the biggest Utica operators is a veritable who’s who in the U.S. oil industry. All the main players want a taste, like ExxonMobil — which became the largest natural gas producer in the United States after their XTO buyout — Anadarko Petroleum, and Chesapeake Energy.

And yet, one small driller has outperformed all of those larger companies…

As you can see, profitable opportunities don’t have come from major producers:


Don’t let the media’s spotlight overshadow emerging investment opportunities.

By the time the herd learned about North Dakota’s oil boom, early investors had moved on to the Eagle Ford.

When they finally caught wind of that shale play in South Texas, it was thanks to those billion-dollar buyouts.

Their attention has always been focused on the biggest fish in the pond…

And because of this, they’re overlooking the plain fact that smaller companies, like Rex Energy, are drilling in the Utica’s sweet spot in Carroll County, Ohio.

On Friday, I’m going to show another sorely overlooked area of our oil sector…

After years of being neglected by the market, we’re about to see a serious upside explosion for all involved.

Until next time,

Keith Kohl Signature

Keith Kohl

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A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

Keith’s keen trading acumen and investment research also extend all the way into the complex biotech sector, where he and his readers take advantage of the newest and most groundbreaking medical therapies being developed by nearly 1,000 biotech companies. His network includes hundreds of experts, from M.D.s and Ph.D.s to lab scientists grinding out the latest medical technology and treatments. You can join his vast investment community and target the most profitable biotech stocks in Keith’s Topline Trader advisory newsletter.

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