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This Area Is Worth Its Weight in Natural Gas

By Taylor Muckerman and Joel South - Apr 12, 2013 at 1:34PM

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The price of natural gas has been on the rise in 2013. Which companies are benefiting, and where are they locating their operations?

The long-anticipated rise in natural gas prices has finally taken shape in 2013. The first three months of the year have witnessed the spot price climb north of $4 per MMBtu, and investors in low-cost producers of natural gas in the Marcellus Shale have seen that portion of their portfolios climb accordingly.

Choosing not to switch proves wise
Throughout 2012, many companies chose to defer portions of their capital budgets away from natural gas and into more liquids-heavy wells. Take Devon Energy (DVN 2.60%) and Chesapeake Energy (CHKA.Q) for example: Both of these companies shied away from gas toward liquids in 2012 and are missing out on the run-up in natural gas prices. 

Compare the paths they have charted to begin 2013 with peers that stuck to their guns, like Cabot Oil & Gas (CTRA 2.09%) and others mentioned in the video below, and it's clear to see that staying the course has paid off thus far. Cabot Oil & Gas will continue to target growth in the Marcellus Shale in 2013, and if the gas pricing trend continues it could be a very wise move.

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Stocks Mentioned

Coterra Energy Inc. Stock Quote
Coterra Energy Inc.
CTRA
$34.65 (2.09%) $0.71
EQT Corporation Stock Quote
EQT Corporation
EQT
$47.40 (1.17%) $0.55
Range Resources Corporation Stock Quote
Range Resources Corporation
RRC
$34.71 (6.05%) $1.98
Chesapeake Energy Corporation Stock Quote
Chesapeake Energy Corporation
CHKA.Q
Devon Energy Corporation Stock Quote
Devon Energy Corporation
DVN
$73.81 (2.60%) $1.87

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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