Crescent Point Energy Corp (CPG), Legacy Oil Plus Gas Inc (LEG): Buy This Canadian Liquid Instead of Maple Syrup

Rail Less Traveled Some of you might question how the company will move this increase in production should further waterflooding be approved. Well, management’s foresight has led to rail transportation capacity of more than 60,000 barrels per day (bpd). Not only will this ensure that its oil has an escape route, but also that pricing differentials won’t vary as widely as they would if the company relied solely on pipelines.

Many Golden Years to Come With 14.2 years or 2P reserves (Proven + Probably) already on its books, enhancements from waterflooding are likely to expand its reserve base. Since 2002, its reserves have grown at a CAGR (Compound Annual Growth Rate) of 18%. I fully expect this to grow, or be maintained at the very least, given the company’s current initiatives and Uinta acquisition. What investors are likely to appreciate about the Crescent Point Energy Corp (TSE:CPG)’s assets are that they are producing 91% oil which reduces the volatility of more natural gas-heavy competitors.

Sealing the Deal All told, Crescent Point Energy Corp (TSE:CPG) and its team have been able to grow reserves at a credible clip and production has followed suit – 7% CAGR since 2002 to 117,500bpd. All the while, investors have been treated to a substantial 7.2% dividend yield, made possible by annual cash flow growth of 19% over the past decade.

Moving forward, I feel confident that management’s anticipatory measures – exemplified by acquisitions, waterflooding, rail transport, etc… – will continue to enhance Crescent Point Energy Corp (TSE:CPG)’s value and, in turn, my Real Money portfolio.

You can follow Taylor on Twitter @t_Muckerman.

The article Buy This Canadian Liquid Instead of Maple Syrup originally appeared on Fool.com and is written by Taylor Muckerman.

Taylor Muckerman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. 

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