When it comes to exploring for natural resources, the right location pays off. This is especially true for precious metals companies reporting mineral interests in excess of one million hectares or 3,861 sq. mi. As long as a company has money, I can count on exposure for many field seasons. As that, the reverse is also true. W/ a property slightly less than 4 sq. mi., if no mineral exposure after one or two field seasons of straight exploration, the game is very likely over.
With that, I agree with Oil Investing News’s three mega-oil territories: Brazil, West Africa, and Gulf of Mexico (these are past-producing regions):
1) Brazil: Petrobras (NYSE:PBR) is the leader here specializing in off-shore drilling the coast of Brasil (I attended a luncheon w/ this company before). It is said that “god blessed Brasil with oil”. According to Oil Investing News, the Lula oilfield, discovered in 2007, is one of “the largest discoveries in the Western Hemisphere of the past 30 years”. Petrobras claims, and others speculate, that there are anywhere between 50 and 100 billion barrels of oil there. No one knows exactly how much it would cost to extract the oil from the coast.
2) West Africa: a recent oil discovery off the coast of Ghana offers investors new opportunities. However, investors need to pay attention to the political climate.
3) Gulf of Mexico: last year BP oil spill off the coast of Louisiana has cast doubt into oil exploration in the region. Where there is blood, there is opportunity.