EOG Resources Inc (EOG), Sanchez Energy Corp (SN), Rosetta Resources Inc. (ROSE): Build Your Own Eagle Ford ETF

Production is growing rapidly. In 2011, the company produced less than 1,000 b/d. But that figure is expected to hit 8,000-10,000 b/d by the end of 2013. Because the management team has been doing business in the region for over 40 years, Sanchez Energy Corp (NYSE:SN)’s reputation has allowed it to acquire acreage more affordably than rivals.

While the company is focused on the Eagle Ford, it also holds a small position in the Haynesville play with approximately 82,000 net acres. But the company is taking a ‘wait and see’ approach before developing these assets. Management would prefer to sit on the sidelines until new rail capacity is added.

Third – Rosetta Resources Inc. (NASDAQ:ROSE) is a mid-size exploration and production company with a $1.3 billion market capitalization.

Rosetta Resources Inc. (NASDAQ:ROSE) has one of the most efficient drilling programs in the region with the second highest daily well production rates. A concentration of assets in a small geographical area also results in major cost savings. The company is expected to grow oil production 40% in 2013.

And while Rosetta Resources Inc. (NASDAQ:ROSE) use to be a pure play, management recently spent $800 million to pick up promising acreage in the nearby Permian Basin. However, Eagle Ford still accounts for 70% of production.

Fourth – Carrizo Oil and Gas is another attractive producer. Earlier this year the company sold its assets in the Barnett Shale to refocus its efforts of the Eagle Ford.

Finally, to round out this portfolio, I’ll include Swift Energy and Forest Oil. With large companies like ConocoPhillips (NYSE:COP), Marathon Oil Corporation (NYSE:MRO), Statoil ASA(ADR) (NYSE:STO) and CNOOC joining in the land-rush to acquire acreage, these smaller players represent attractive buyout candidates.

Foolish bottom line

Rapid production growth and attractive economics means the Eagle Ford shale could continue to post big returns. Investors should keep these companies on their watch lists.

The article Build Your Own Eagle Ford ETF originally appeared on Fool.com and is written by Robert Baillieul.

Robert Baillieul has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Robert 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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