The prospect of oil prices at $50 a barrel is not going to scare some U.S. producers, and investors should focus on companies with core acreage in good basins, a senor analyst at Global Hunter Securities told CNBC on Friday.
A flurry of announcements from energy companies indicate capital expenditure in the oil exploration and production sector will decline significantly in 2015. The rule of thumb is a roughly 20 percent pullback from 2014 levels, Mike Kelly said in a "Power Lunch" interview.
Oil firms are facing the reality that a number of their projects don't work at $50 or $55 a barrel, so they are cutting their least economic plays from their portfolio of assets, he said.
"It's a little bit scary when you do that though because you're basically stopping drilling. You are potentially going to have your production go on decline."
Read More Chart shows oil rig count may have long way to fall
Some of the companies Kelly believes are well-positioned to weather the pullback are Concho Resources, Synergy Resources, Carrizo Oil & Gas, and Whiting Petroluem.
On Friday, Baker Hughes reported the number of active rigs in North America declined by 58 from the previous week. Producers took 18 offline in the United States and 40 in Canada. Two rigs went inactive in the Gulf of Mexico.
Disclosure: Kelly and his family have no ownership in the stocks mentioned. His firm does not have a greater than 1 percent ownership in the stocks but does provide investment bank services to them.