recommendation for diversified large cap asx oil play

[modandm]

Guys, im looking to put some cash into a blue chip Aussie oil co. Which do you consider the BHP of the Oil sector?

I don't follow the energy sector closely but am looking for some quality blue chip exposure.

WPL, STO, OSH, are the obvious three. Are there any others I should consider or which of these three do people currently favor.

[impacman]

Guys, im looking to put some cash into a blue chip Aussie oil co. Which do you consider the BHP of the Oil sector?

I don't follow the energy sector closely but am looking for some quality blue chip exposure.

WPL, STO, OSH, are the obvious three. Are there any others I should consider or which of these three do people currently favor.


Hi Modandm, one thing you may want to be aware of is that while OSH is a good company and listed on the ASX it will atract FIF tax as it is registered in PNG. Not a show stopper in its own right but just thought I would flag that.

Cheers,

I-man

[shasta]

Guys, im looking to put some cash into a blue chip Aussie oil co. Which do you consider the BHP of the Oil sector?

I don't follow the energy sector closely but am looking for some quality blue chip exposure.

WPL, STO, OSH, are the obvious three. Are there any others I should consider or which of these three do people currently favor.

Just something to consider is OSH is excluded from the exemption/ASX 300 list under the FIF regime due to its incoporation in PNG.

STO gives you exposure to oil & gas + the unconventional gases like LNG, whereas WPL are a little more skeptical on CSG/LNG

If you read my post on the OEL thread, BHP are looking at expanding on there oil businesses, so they are an option, but not a pure oil/gas play of course.

Out of the stocks mentioned, i'd prefer STO

I man - ya bet me to it

[macduffy]

There isn't really a "BHP of the oil sector", except BHP itself of course!

They all have their big risks so my approach has been to spread the risk. At present I'm holding STO and AWE, the former for its "big project" appeal and the latter because it has a lot of small irons in the fire, most of which are actually producing the stuff! Plus I have a small residual holding of BPT - but I'd rather not talk about that!

Personally, I don't regard my oilies as long term holds. The sector's too volatile - pun not intended - IMO.

[upside_umop]

BHP have stated their on the oil hunt - so I guess you could position yourself to be on the receiving end of this.
If I was, I'd position myself as MacDuffy says and spread your risk amongst the majors amongst the ASX, as I don't think they will be interested in anything small (even AWE/BPT is too small...?)

[macduffy]

I think you're right, u u.

BHP are only interested in big scale, anything consisting of a lot of small projects is - too small! - but also too much admin to be worth BHP's attention.

STO might interest them with its big LNG projects. And of course there is periodic talk that they may do a deal with Shell one day and make an offer for WPL.

[drillfix]

Does this request for stock picks have to be only blue chip large cap? Or are you able to do both and spread some risk across a few variations of stocks.

The reason why I say this is that take a look at the Chart on AUT and SEA, sure there is now some weakness setting in, but IMO I would watch these for any weakness and on potentially buy any bounce.

Excellent charts IMO, but I fundamentally dont know enough about them, so guess thats where all these other guys are excellent at picking apples from oranges etc :)

[modandm]

Does this request for stock picks have to be only blue chip large cap? Or are you able to do both and spread some risk across a few variations of stocks.



I was sort of expecting this response. I know their are a number of keen oil stock investors on the forum who like to diversify among the juniors and look for big returns. Fair go I say - but its not for me. I simply don't have the knowledge/time to research and stay on top of them. There are sectors/companies I do follow but yeah not oil.

Anyway - Im building a core long term portfolio alongside a 'alpha' portfolio and I would like some energy exposure hence the call for recommendations.

I would consider diversifying among 2 stocks but no more than that ideally just one. I already have a some BHP for my core resources exposure.

I'm looking for a stock which is strongly correlated to the oil price also - partly as a hedge of a current investment and partly as I am a bull on oil (medium-term).

I have read WPL has the largest oil reserves and good growth prospects with Pluto coming online this year. Is it so LNG orientated now that it's not correlated with oil price or?

Also are their any production focused mid-size company's with little to no exploration planned, maybe small development but otherwise just a steady producer? I just am not prepared to take exploration risk in this industry. I'll leave that to you experts.

[modandm]

while OSH is a good company and listed on the ASX it will atract FIF tax as it is registered in PNG.
I-man

Thanks guys. Will rule it out just due to it being in the too hard basket.

[shasta]

I was sort of expecting this response. I know their are a number of keen oil stock investors on the forum who like to diversify among the juniors and look for big returns. Fair go I say - but its not for me. I simply don't have the knowledge/time to research and stay on top of them. There are sectors/companies I do follow but yeah not oil.

Anyway - Im building a core long term portfolio alongside a 'alpha' portfolio and I would like some energy exposure hence the call for recommendations.

I would consider diversifying among 2 stocks but no more than that ideally just one. I already have a some BHP for my core resources exposure.

I'm looking for a stock which is strongly correlated to the oil price also - partly as a hedge of a current investment and partly as I am a bull on oil (medium-term).

I have read WPL has the largest oil reserves and good growth prospects with Pluto coming online this year. Is it so LNG orientated now that it's not correlated with oil price or?

Also are their any production focused mid-size company's with little to no exploration planned, maybe small development but otherwise just a steady producer? I just am not prepared to take exploration risk in this industry. I'll leave that to you experts.

In a way you have answered your own question...

BHP - Already hold
OSH - Due to FIF regime "too hard basket"

That leaves in the big boys catergory

WPL
STO

If you are happy to look at two, then those two provide enough exposure to oil, gas & unconventional gases (CSG, LNG) with large projects

The next tier of oilers include:

AWE
BPT

But these are still risky

Then the bigger juniors in O&G production include:

NZO, CUE, HZN, ROC, NXS, NDO, OEL, TAP, CVN, COE

[upside_umop]

BHP have stated their on the oil hunt - so I guess you could position yourself to be on the receiving end of this.
If I was, I'd position myself as MacDuffy says and spread your risk amongst the majors amongst the ASX, as I don't think they will be interested in anything small (even AWE/BPT is too small...?)

The rumours are swirling and with the big rise in WPL's price in the last wee while...it's interesting to see why.

BHP Planning A$46 Billion Woodside Offer, Sunday Times Says (1) (http://noir.bloomberg.com/apps/news?pid=20601087&sid=alaPTvsYYlMM&pos=2)

[modandm]

i bought some WPL around the time of the OP and have been pretty happy with the rise.:D

Wish I had more...