Top-quality reserves cut their risk

Article Excerpt

U.S. oil production is up 40% since 2008. That’slargely because of new technologies like hydraulicfracturing, or fracking. This involves injecting water,sand and chemicals to break up shale and other tightrock formations and allow access to the oil and gas.The global economy continues to recover from therecession, so rising demand from industry and consumersshould help stabilize oil and gas prices, even asoutput from shale increases.The best way to profit from this volatile industry isthrough companies with high-quality reserves and diverseoperations, such as these four. However, not allof the four are buys right now.CHEVRON CORP. $118 (New York symbol CVX;Conservative Growth Portfolio, Resources sector;Shares outstanding: 1.9 billion; Market cap: $224.2billion; Price-to-sales ratio: 1.0; Dividend yield: 3.4%;TSINetwork Rating: Above Average; www.chevron.com) is the second-largest integrated oilcompany in the U.S. after ExxonMobil.Chevron continues to make progress on two bigAustralian projects. The first is its 47.3%-owned Gorgonnatural gas development off the country’s westcoast. Gorgon, which includes afacility to liquefy gas for shipping,is now 60% complete…