The fossil fuel industry is deeply out of favor with a world that is increasingly focused on saving the environment. However, that doesn't mean you can't find some good investment options there. You just need to be able to recognize which companies have something that sets them apart from the pack.

Here are three excellent energy stocks that investors might want to consider as long-term additions to their portfolios.

ConocoPhillips: Dedicated to drilling

Roughly a decade ago, ConocoPhillips (COP 3.44%) spun off its downstream refining assets so it could focus solely on drilling for oil and natural gas. That was a bold move, transforming it from something of an integrated energy company into a pure-play exploration and production operation. It also cut its dividend in 2016 during a period of industry weakness in an effort to reset the business and put itself on a stronger growth trajectory. That decision appears to have been a good one -- investors should note that it was able to increase its dividend payout in 2020 despite the steep oil price declines driven by the pandemic.

A pair of hands stained with oil.

Image source: Getty Images.

The company has used the downturn to augment its business. It completed its acquisition of Concho Resources earlier this year, and more recently picked up additional land in the Permian Basin oil region. The company believes it is positioned to grow production by around 3% a year over the next decade while producing upwards of $80 billion in free cash flow over that time period. Although the stock will likely rise and fall along with the often-volatile price of the commodities it produces, if you are looking for an oil and natural gas pure play, ConocoPhillips is a solid, well-positioned option.

Chevron: Diversified and strong

Investors who don't have strong enough stomachs to handle the ups and downs of volatile pure-play oil producers should look at Chevron (CVX 2.60%). This integrated energy giant has a business that spans from the often-volatile upstream (drilling) segment through the stable midstream (pipelines) area and into the downstream (refining) space, which tends to benefit from lower oil prices. In other words, compared to ConocoPhillips, Chevron is a diversified way to invest in oil and natural gas. 

It also happens to be one of the strongest businesses in the segment, with a rock-solid balance sheet: Its debt-to-equity ratio of 0.33 times is the lowest in its peer group. It has been increasing its dividend payouts annually for over three decades, making it a Dividend Aristocrat. And at current share prices, it yields an attractive 4.75%, well more than the 2.4% or so you'd get from ConocoPhillips. For more conservative investors, it's likely one of the safest stocks in the energy space today.

ENB Dividend Yield Chart

ENB Dividend Yield data by YCharts

Enbridge: A slight twist on the oil space

Enbridge (ENB 1.21%) probably isn't what most investors would think of as an oil name. That's fair, given that it technically operates in the midstream space. However, its fortunes are directly tied to demand for oil and natural gas. To put some numbers on that, its oil pipelines account for nearly 55% of earnings before interest, taxes, depreciation, and amortization (EBITDA), while its natural gas pipelines chip in just shy of 30%. By miles of pipe, it holds the No. 1 position in oil in North America and the No. 2 spot in natural gas. 

Enbridge's midstream operations largely generate their revenues from fees, so demand for its pipes is more important than the prices of what flows through them. Given the still-massive global demand for these fuels, its business is highly reliable and its cash flows are fairly predictable. That's one of the reasons why it has been able to increase its dividend every year for a quarter of a century -- which makes it, like Chevron, a Dividend Aristocrat. Meanwhile, at current share prices, its yield is a hefty 6.2%, toward the high end of the company's historical range. In other words, this stock looks pretty cheap today. And for more conservative income investors, it could be a great way to dip a toe into the oil space without taking on the commodity risk of owning a driller.

Three great ways to play

It can be nerve-wracking to invest in oil and gas industry stocks given the inherently volatile nature of the sector. However, ConocoPhillips appears to be a solidly positioned pure-play driller for those with adventurous spirits. Chevron offers more of a balanced approach, with exposure to the energy industry's three main sectors and a rock-solid balance sheet. Enbridge, meanwhile, is a safe way to edge into the energy patch, given its heavy exposure to fee-generating oil and natural gas pipelines. If you want to add a long-term position in the energy sector to your portfolio, one of this trio should fit your needs.