The Enduring Appeal of Canadian Oil and Natural Gas Stocks

by George Lunga
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Submitted by George Lunga as part of our contributors program.

“The War on Coal” has been a lesson for all investors that no matter how established the energy group in the United States, it could still become out-of-favor with adverse consequences for owners. The more shareholders for coal firms in the United States lose, the more attractive Canadian oil and natural gas companies become. Best of all, there is something in it for all investors, ranging from blue chip “Big Oil” firms like Suncor Energy (NYSE: SU) to small caps on the move such as Octagon 88 (OTCBB: OCTX) and Americas Petrogas (TSX: BOE).

Just reporting its second quarter results, net revenues are up 70% for Americas Petrogas, based in Calgary, the energy capital of Canada. Sales volume is also surging for Americas Petrogas, too. Adding to is appeal is a very positive indepedent report on its shale resources in Argentina.

The shareholders of Octagon 88 have also benfited from a bullish report.

According to the headline of one article, “Octagon is All Set to Enter the Billion Barrel Club.” Since early July, Octagon 88 has almost doubled in price. With the reports on its holdings in Canada, the future looks very promising.

Completing the offerings are also major oil and natural gas firms such as Suncor Energy, Canadian Natural Resources (NYSE: CNQ), and Imperial Oil (NYSE: IMO). All three have solid financials and pay a dividend to shareholders. For Suncor Energy, Warren Buffett is a major shareholder. He has also been loading up more more shares.

That in itself is very bullish for Canadian oil and natural gas stocks.

The chart below shows a major factor for the enduring appeal of the Canadian energy sector. There is a great disparity in pricing. That provides a competitive advantage for those firms operating from Canada and selling around the world.

The country welcomes foreign investment and respects private ownership.


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