Buy APA at $66.50

I am boosting my energy sector investments to 7% of holdings by adding Apache Corp. I believe the fossil fuel production has not peaked and there is excellent room for expansion in the price of a barrel of oil as well as improvement in stock performance of APA.


Fossil fuels remain the dominant form of energy powering the global expansion: providing around 60% of the additional energy and accounting for almost 80% of total energy supplies in 2035. Renewables grow rapidly, almost quadrupling by 2035 and supplying a third of the growth in power generation. – BP Energy Outlook

Oil will remain the world’s primary energy source, fulfilling 1/3 of all demand.
Oil will continue to play a leading role in the energy mix, driven by demand in transportation and feedstock for the chemical industry. – ExxonMovile Energy Outlook

Jim Cramer is a buyer of Schlumberger Limited (NYSE: SLB), Magellan Midstream Partners, L.P. (NYSE: MMP) and Apache Corporation (NYSE: APA). He advised a viewer to hold these stocks if they are a part of a big diversified portfolio.

North American onshore, on the other hand, has remarkable growth potential, driven by the recent Aline High discovery. The company is in the process of ramping up its activity levels in that play, which should return the North American segment to a growth trajectory by the second half of next year. While Apache has not put out an estimated production growth rate, it has an enormous inventory of future drilling locations. In fact, Alpine High could have more than 3,000 future drilling locations while the company could have an even larger inventory throughout the rest of its Permian Basin acreage. On top that, the company has a large acreage position in the SCOOP/STACK plays of Oklahoma as well as an extensive position in Canada’s Duvernay and Montney shale plays. – Matthew DiLallo Motley Fool

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