OPEC Implodes

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Weird satellite image reveals hidden $1.2 billion windfall This photo of the Bakken oilfield shows something very peculiar... It's a strange, never-before-seen phenomenon this energy boom is causing... something that's never happened in America before. But it's created the opportunity for ordinary investors to pocket millions — regardless of what happens to oil prices. Click here to see this photo — and this unusual story — right now. OPEC Implodes By Keith Kohl | Tuesday, March 3rd, 2015 Prince Salman and the rest of the Saudi royal family are using their oil price war to kill three birds with one stone in 2015. But don't worry; their aim is way off target. The current price war is more than the Saudi kingdom vs. North America. For the Saudis, the war has been about one thing only: market share. By strong-arming OPEC into not cutting production, the Saudis have effectively driven crude prices to a floor not seen in about six years. That alone has had a considerable effect in the United States, with rigs being idled at a record pace and companies slashing capital budgets between 20% and 50%. In Canada, the consequences are even more severe. Some of the largest operators in the oil sands are already at a disadvantage due to the costs associated with extracting and upgrading the vast bitumen resource. In fact, we're about to see the Saudis bury their first victim: OPEC. Advertisement Another "Bakken Bomb" Goes Off On February 16, a massive Bakken crude oil train derailed and exploded in West Virginia. The violent blast destroyed a home, leaked countless gallons of oil into a source of drinking water, and caused 1,000 people to evacuate. Just two years ago, another "Bakken Bomb" crashed and exploded in Lac Mégantic, Quebec, killing 47 people and destroying a small community. These and multiple other crashes have prompted regulators to crack down. And when they do, investors in one small company will see a financial windfall. If you play it right, this stock could hand you a payday of $35,465 within a year. Here's everything you need to know. OPEC's First Victim: OPEC Always keep in mind that Prince Salman's goal is to strengthen Saudi Arabia's share of the global oil market — and he sees it as every man for himself right now. If that means stealing a piece of the market from fellow OPEC brethren, so be it. And the next in line to get pushed over the cliff is Venezuela. If you're still wondering why the Saudis want to sabotage Venezuela's financial future, look no further than the U.S. Gulf of Mexico. Specifically, it's the refineries along the coast that are so valuable. The Energy Information Administration made it even clearer for us last January. Just take a look at the map of U.S. regional refinery capacity below: Click Image to Enlarge In total, the U.S. has a refining capacity of around 19 million barrels per day. But refineries located in PADD 3 (the Gulf Coast) have a capacity of approximately 9.7 million barrels per day — or more than 51% of the U.S. total. But it goes beyond simply how much crude we can refine on a daily basis — it's also the quality of the crude being refined. Take another glance at the image above. The first glaring statistic that comes to mind is that approximately 81% of the refineries have coking units, which are necessary to upgrade heavy oil. And that, dear reader, is why Venezuela is in dire straits. Advertisement Time to Buy This... The time to buy an oil or gas company drilling in a new shale formation is when: Production is just starting; Initial wells are showing great results; and The mainstream investing public knows very little about it. There's a new $1 company in the historic Petroplex formation that meets all three of these conditions. With nearly 20,000 acres of land and great initial results on its horizontal wells, it's only a matter of time before this company trades at $10. Click here for the ticker symbol. Even though the country boasts more proven oil reserves than anyone else — 297 billion barrels (we'll take them at their word for now) — there's a catch to this staggering oil supply. It turns out that nine out of every ten barrels of proved reserves in Venezuela are found in the Orinoco Belt. This supply isn't the light, sweet quality that companies in North Dakota and Texas are offering to refiners, but rather an extra-heavy crude similar to what is being extracted in the Canadian oil sands. In other words, it's an incredibly expensive source of oil to tap; during a period of ultra-low oil prices, you can bet the country is feeling the pinch. Without access to the refineries along the U.S. Gulf Coast, Venezuela would be in an even tighter spot. So you can imagine the growing tension at OPEC meetings after Venezuela's exports to the U.S. Gulf of Coast declined by 20% between 2009 and 2014, while Saudi Arabia's exports to the same area have jumped 20%. Frac it All... Again? I'm not trying to suggest that U.S. companies are having the time of their lives with oil prices hovering around $50 per barrel. Far from it, actually. If nothing else, it's given individual investors like us the chance to find the real diamonds in the rough. And at a time when anyone with a dime invested in the energy sector is sick of volatility, being able to separate the best independent players from the pack can make all the difference. So how are U.S. companies riding out the volatility? The answer is simple: boosting drilling efficiency. That means both cutting the high costs associated with drilling and completing new wells and simultaneously increasing production. As my readers found out recently, a very select group of companies within the United States have found a way of doing just that. In fact, it's one of the few ways I've seen oil companies thrive while oil prices are at a bottom. And the best part is that it involves a technology that has been around since 1949. I recommend you take a few moments and look at the full details for yourself here. Until next time, Keith Kohl @KeithKohl1 on Twitter A true insider in the energy markets, Keith is one of few financial reporters to have visited the Alberta oil sands. His research has helped thousands of investors capitalize from the rapidly changing face of energy. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital as well as Investment Director of Angel Publishing's Energy Investor. For years, Keith has been providing in-depth coverage of the Bakken, the Haynesville Shale, and the Marcellus natural gas formations — all ahead of the mainstream media. For more on Keith, go to his editor's page. I liked this article | I did not like this article Follow Energy and Capital on The Bottom Line Related Articles Keystone XL: Obama and Congress Play Tug-of-War Natural Gas Flaring Fortunes Warren Buffett's $44 Billion Blunder Revealed Tales from an Oil Supply Glut Recently... Here's how you can take advantage Invest in the Cuba Libre This "Green" Car is Useless! What the U.S. Refinery Strike Means for You The Best Buying Opportunity in Six Years

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