It's official. According to the International Energy Agency
(IEA), the United States could be the world's largest oil-producing
country in the next seven years.
on the report
, the United States could surpass all other countries in oil
production by 2020. And 10 years later, the country could be
Talk about your 180-degree turnarounds.
For the past several decades, the United States has depended
heavily on imports to feed its 19-million-barrel-per-day oil habit.
In fact, about one out of every five barrels the United States
consumes each day comes from a foreign country.
But if this forecast is accurate, then the United States production
could eventually outpace domestic consumption. So instead of
bringing in oil, we could be shipping it out.
Is this plausible? You bet it is.
In fact, the whole scenario sounds eerily similar to what has
happened in the natural gasmarket . A decade ago, every
credibleanalyst was convinced that the United States was running
out of gas, and energy companies spent billions to construct import
Now, the United States has more than it can use, and those import
facilities are being converted to export hubs to send gas the other
The start of this amazing reversal may have already begun. From
2008 to the end of 2012, crude output in the United States climbed
to 7 million barrels per day from 5.1 million, an increase of 37%.
That's an extra 1.9 million barrels of oil coming to the surface
Thecredit goes to unconventional reservoirs like North Dakota's
Bakken Shale, where oil production has surged to more than 673,000
barrels per day now from around 3,000 barrels per day in 2000. And
that's just onespot -- there are billions of barrels waiting to be
recovered in shale formations across the United States.
And that's not even counting offshore drilling in the Atlantic
Ocean and Gulf of Mexico.
The powerful combination of horizontal drilling and hydraulic
fracturing (better known as "fracking") has given producers easy
access to oil that was once thought of as unreachable. And these
new supplies could quickly wean the United States off of foreign
So if this IEA outlook is accurate, then what is the takeaway for
Well, the collapse in natural gas prices resulted from a supply
glut. I don't think therewill be a repeat with crude oil, but the
influx of shale oil could certainlyput downward pressure on prices
or at least limit some of theupside .
But when you look past the upstream producers, there are entire
sectors that could see unprecedented demand for their products and
services thanks to North America's oil boom.
In fact, it may be one of the best ways to makemoney in thestock
market in the next decade.
More oil exploration means increased demand for offshore and
land-based drillers, and more work for pressure pumping and
hydraulic fracturing crews.
And all that drilling and fracking requires alot of water. In
fact, for every one of the approximately 11,400 new shale wells
drilled per year in the United States, nearly 6.1 million gallons
of water is required. That comes out to
70 billion gallons of water needed per year.
That's one reason I'm keeping a close eye on
, an oilfield-service company that sources, stores and transports
fresh water to drilling sites. The company also treats and disposes
of used "flowback" water and waste fluids. They get paid for
bringing in fresh water and hauling out the waste water -- it's a
solidrevenue stream that could last up to 30 years.
As I mentioned in a
, Heckmann has an active presence in eight shale formations around
the country. The company is now firmly entrenched in oil and
liquids-rich plays such as the Bakken Shale in North Dakota, the
Eagle Ford in Texas and the Utica in Ohio -- all spots where
exploration and development activity are buzzing.
To serve these regions, Heckmann has amassed a fleet of 1,200
trucks and 200 rail cars, along with over 100 miles of water
collection and delivery pipelines. The company also owns 4,200
frack tanks and 46liquid waste disposal wells. More recently, it
has been constructing facilities designed to treat and recycle used
Action to Take -->
I think the stock could deliver close to a 20%gain by the end of
the year, with plenty of upside even after that.
But more important, this new energy boom will have majorinvesting
implications for years to come... and now is the time to act,
before the big money is made.
-- Nathan Slaughter
P.S. - Heckmann is just the tip of the iceberg. The
next big commodities play is unfolding right now... This disruptive
energy technology will bring about major changes in our country...
and one company is leading the charge. To learn more about this
opportunity, click here.
Nathan Slaughter owns shares of HEK.StreetAuthority LLC owns
shares of HEK in one or more of its "real money" portfolios.