Exxon Mobil Corporation (XOM), ConocoPhillips (COP): Are Energy Exploration Stocks Worth the Risk?

And any profits BP plc (ADR) (NYSE:BP) might gain as it responds to China’s ever-increasing demand for fossil fuels are only one portion of the total picture. In June, BP along with its partner Zhuhai Port, received final approvals from the Chinese government to construct a purified terephthalic acid (PTA) plant at Zhuhai, Guangdong where two similar facilities are already located.

This facility, which is slated to become operational during late 2014, will have the bulk to produce 1.2 million tons of PTA a year. BP played a major role in the development of this petrochemical, which is utilized worldwide in food packaging and textiles

A Foolish conclusion

It might be exciting to look ahead and envision the profits that BP could gain from expanding markets in China and elsewhere around the world. However, the recent announcements about the lending practices of major banks could prevent BP’s Chinese operations from ever living up to their “promise.”

And that company’s ongoing legal entanglements, including possible criminal cases, emanating from the Deepwater Horizon oil spill might dampen its earnings  for the foreseeable future. If nothing else, continued public scrutiny of this incident could push BP to spend considerable resources on public relations efforts aimed at bolstering its image.

However, a closer look at ConocoPhillips (NYSE:COP) and Exxon Mobil Corporation (NYSE:XOM)’s strong fundamentals seemingly indicate that they are reasonable considerations for boomer’s retirement portfolios. ConocoPhillips’ annual dividend rate stands at 4.3%, a yield far beyond what boomers might earn from more conservative investments. And the fact that this company’s 52-week stock price history shows a gain of 9.9%is also encouraging.

Exxon Mobil Corporation (NYSE:XOM)’s growth rate for 2013 is projected to be 8.1%, a statistic that should reassure boomers looking to secure their retirement. And this company’s return on equity, 28.3%, as well as its return on assets, 10.2%, point to effective management. Analysts predict that ExxonMobil’s EPS for the fiscal year ending December 2014 will be $10.84.

Harriet Tramer Tramer has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Harriet is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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