CTMPR

The Bakken Oil Field has been in existence for 2.5 to 3 million years, geologists and oil companies have been pursuing it off and on since the 1970’s.  During the 70’s oil boom there was a mini oil boom in Western ND but by the early 80’s it had gone bust.  It wasn’t until hydraulic fracing was combined with horizontal drilling technology that they were able to make wells productive.  Then crude oil needed to get above $40 on a consistent basis in order to provide the profitability needed to extract the oil and bring it to market.

Today with oil hovering in the $80-90 range there is an absolute boom going on in Western ND.  In fact, oil men from Houston are opening offices in Minot ND to be near the action!

There are literally dozens of oil drilling, production and services companies that benefit from the Bakken.  I’ve been a longtime investor in Enbridge Energy Partners LP (EEP) which has 240 miles of pipeline in ND and also serves the Canadian Oil Sands. My 3 favorite Bakken Oil stocks are Northern Oil and Gas (NOG), Brigham Exploration (BEXP) and Kodiak Oil and Gas (KOG) which are up 98%, 95% and 130% respectively this year.

There is also a niche mutual fund that is focused on companies doing business in the Bakken Oil Field. It’s called the Williston Basin Integrity North American Stock Fund – Ticker Symbol ICPAX and here are the top 25 holdings of the fund.

I also listed them below as it gives you an idea of how many companies there are benefiting from the Bakken oil boom. I wish I would’ve heard of this fund several months ago because it had a stellar 4th quarter!

CRR Carbo Ceramics, Inc.
BHI Baker Hughes Inc.
BEXP Brigham Exploration Company
OAS Oasis Petroleum Inc.
CPX Complete Production Services, Inc.
WLL Whiting Petroleum Corporation
LUFK Lufkin Industries, Inc.
EOG EOG Resources
HAL Halliburton Company
CLR Continental Resources, Inc.
DRC Dresser-Rand Group, Inc.
NOV National Oilwell Varco, Inc.
GEOI GeoResources, Inc.
PTEN Patterson-UTI Energy, Inc.
ENB Enbridge, Inc.
WFT Weatherford International Ltd
NOG Northern Oil & Gas Inc
NBR Nabors Industries, Ltd.
BAS Basic Energy Services, Inc.
KOG Kodiak Oil & Gas Corp.
TRP TransCanada Corporation
HES Hess Corporation
MRO Marathon Oil Corporation
NEM Newmont Mining Corporation
CFWFF Calfrac Well Services Ltd

2010 was another tough year for any Short ETF but it was especially tough for the leveraged Short ETFs. UltraShort Silver was the worst performer as silver soared on strong investor demand and QE2.

Here are just a few examples of YTD performance as of 12/21/2010:

ZSL – Ultrashort Silver was down over 74%
DRV – Direxion Daily Real Estate Bear 3X was down over 67%
VXX – iPath S&P 500 VIX S-T Futures ETN was down almost 64%
TZA – Direxion Daily Small Cap Bear 3X was down almost 60%
CZI – Direxion Daily China Bear 3X was down over 55%

The only long ETFs that were in the 20 worst performers were Natural Gas ETFs UNG and GAZ both down around 43% as well as PowerShares Global Wind Energy – PWND which was down nearly 41%.

After two years of a near free fall the Short ETFs are now attracting the attention of contrarian investors, only time will tell if 2011 will treat them any better than 2009 & 2010.

All information was taken from the Yahoo Finance ETF Screener.

Granted it’s only December 20th but it’s highly unlikely things are going to change dramatically in the next 10 days. This is especially true with the #1 performing ETF of 2010 which is the Double Silver ETF – AGQ. AGQ is up a stunning 137% YTD which puts it in a category all by itself, no other ETF registered a 100% gain this year. In fact, the top 10 ETFs were totally dominated by Silver, Gold and the Internet.

Other top performing ETFs of 2010 were:

BHH – up 71% but trades for less than $1 and only contains 2 stocks ARBA and ICMG

Several unleveraged Silver ETFs were next on the list. These include: SLV, SIVR, DBS and USV all up roughly 65% on the year.

Another Commodity ETN that had a banner year was the iPath Cotton based fund – BAL which was up just shy of 60%

Junior Gold Mining ETF – GDXJ was up 57.15% along with the Double Gold ETF – DGP being up 54.92% and UGL was up 51.41%

To round out the Top 10 is another Internet Holder – IIH (up 53.49%) which is dominated by 2 positions in Verisign and Akamai which both had stellar share appreciation this year.

Other stand outs were:

Emerging Markets ETF – THD (Thailand) up 51.30% as well as EPU (Peru) up 48.59%

The best performing Direxion 3x Leveraged ETF was their Real Estate Bull – DRN which was up 43.94%

After a strong 4th quarter many pundits are predicting a flat 2010 for the equity markets. This may be the case but I distinctly remember several of these same people calling for a flat to lower 2010. As with most years there are likely to be plenty of winners and lots of losers as well.