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Natural Resources–Still Looking Good

07/21/2006 12:00 am EST


Louis Navellier

Editor, Growth Investor, Breakthrough Stocks & Accelerated Profits

Financial maven and editor of the Global Growth Report, Louis Navellier believes investors would do well to add some global exposure to their portfolios, and what better way than by taking advantage of the rising natural resource sectors to zero in on a couple of good opportunities…


“France's Compagnie Generale de Geophysique (GGY  NYSE) provides seismographic services and equipment for oil and gas companies worldwide.  The company's Sercel unit makes geophysical equipment, including land and marine seismic acquisition systems. GGY's geophysical services unit provides land-based seismic surveying, including borehole services and marine seismic surveying. It can deploy up to 17 land crews and operates a fleet of four multi-streamer 3-D vessels.  The company also processes the seismic data it collects. 
“Overall, oil services account for almost two-thirds of the company's sales. French companies have traditionally worked in regions that many British and US companies would not venture into, such as Iraq during the Saddam Hussein era, but the world also has to find new sources of oil and natural gas in politically stable environments quickly. Given world tensions, the day rates in the oil service business will likely remain very high. This essentially ensures that Compagnie Generale de Geophysique will post very strong earnings for the foreseeable future. 
South Africa's Gold Fields Ltd. (GFI  NYSE) is back for an encore appearance as the bull market in gold resumes. The yellow metal shot back to $667 per ounce Friday. Gold Fields is one of the world's largest gold exploration and development companies. It currently ranks as South Africa's #2 gold producer, behind AngloGold Ashanti. The company produces more than four million ounces of gold annually at mines in South Africa (such as Beatrix, Driefontein, and Kloof), Ghana (Damang and Tarkwa), and Australia (St. Ives and Agnew).  Gold Fields has mineral reserves and resources of more than 200 million ounces of gold. 

“Last Wednesday, Gold Fields announced that it has acquired three million shares in Western Areas Ltd., increasing its total stake in that company to 19%. Including its latest purchase, Gold Fields now holds about 29.2 million shares in Western Areas, which owns 50% of the South Deep gold mine in South Africa, located near Gold Fields' Kloof gold mine.  Barrick Gold, the world's largest gold producer, holds the remaining 50% interest in South Deep.  Due to the rising tension in the world today, gold stocks are once again emerging as an oasis amidst the chaos.”  

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