While ConocoPhillips (COP) continues to expand to all corners of the world, the company has taken a pull-back approach on some of its non-core overseas assets. The company recently sold a stake in the North Caspian Operating Company in Kazakhstan and also decided to unload its stake in Russia’s second-biggest oil producer, LUKOIL (LUKOY.PK). Monies gained from these disposals are to be used for exploration, debt reduction and dividend payments. When a company like this has a large stash of cash, it is a clear sign of future success.
ConocoPhillips historically has bought into profitable ventures that provesuccessful. When the company doesn’t see a good fit, it either walks away or tries to sell off what didn’t pan out. The company is beginning to dig deeper into the natural gas exploration and production phase hoping to cash in on the plentiful supply and the hopefulness of upcoming risingnatural gas prices. The company’s average selling price of natural gas increased from $4.40 per thousand cubic feet in 2009 to $5.64 in 2011 before plummeting in 2012 with an oversupply in the market. With predictions as high as $5 for this winter, and with ConocoPhillips looking to expand as far as China for the gas, the company will be in a great position to increase its bank of capital dollars even more. I believe that this is a company that should be included in the oil and gas investment portfolio as soon as possible. If you own it, buy more.