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10 Ways to Play the Fracking Boom

A number of options, from Big Oil stocks to small M&A prospects

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Range Resources

Range Resources RRCOne great example of a stock that embodies the shale boom in the U.S. is Range Resources (NYSE:RRC). The firm was a pioneer in the most economically valuable shale formation in the nation — the Marcellus in Pennsylvania — and owns arguably some of the best land across the region.

Most of the E&P firm’s production stems from dry natural gas, but it does see around 20% coming from gas liquids and oil. The focus on straight natural gas has hurt shares recently, but that could be changing. The bulk of Range’s acreage in the Marcellus contains liquids-rich gas and oil. Shale oil and NGLs offer firms higher returns and higher margins as their pricing is tied to crude.

The real win for shareholders could be a potential buyout. Analysts estimate that as takeout candidate, Range’s shares could fetch about 50% more than where they currently stand. That would be a roughly $20 billion acquisition, meaning only a handful of energy majors like Royal Dutch Shell (NYSE:RDS.A, RDS.B) or state-backed interests would apply.

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