Energy Quest, Cramer's Gulf Plays

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After a difficult period following the Gulf spill, oil exploration and drilling in the region has started to increase significantly.

For pros such as Jim Cramer, word of increased business activity immediately triggers a search for related stock opportunities.

After consulting with top energy trader Dan Dicker, a Fast Money favorite and Cramer colleague at, the Mad Money host presented the following stocks as plays on the energy renaissance in the Gulf of Mexico.


"The oil spill is a thing of the past for BP and as the company comes out of that difficult period I think the stock can go higher due to strength in its high-margin Gulf of Mexico production assets," Cramer said.

Also Cramer sees the potential for increased drilling. "Since the beginning of 2011, BP has deployed eight new rigs to the area, and the company's looking to raise that to 10 rigs down the road in order to accelerate their drilling program."

However, an increase in production isn't the only catalyst. Cramer sees something else.

"Once we get a settlement on the Gulf spill, the stock could advance sharply," Cramer explained. "BP has already set aside $41 billion for damages, so if the actual settlement turns out to be anything less than that, it's pure upside from Wall Street's perspective."

off shore oil and gas drilling rig exploration
Landbysea | Vetta | Getty Images

Anadarko Petroleum

"Although they explore elsewhere in the world, the Gulf of Mexico is a big driver for Anadarko," Cramer explained.

"The company's Shenandoah find was discovered back in 2009, but it was only at the end of March that we learned the resource potential here could exceed 300 million barrels for Anadarko, and that could be a low-ball figure. Plus, given Anadarko's track record, if you had to bet on a company making another major deepwater find in the Gulf of Mexico, I would bet on them," Cramer said.

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"Chevron has some terrific exposure to the Gulf of Mexico in the form of the Coronado, another big deepwater find that we're just now learning about," Cramer said.


Right now the Gulf isn't a real revenue driver for Conoco although they do participate somewhat through partnerships.

"However, if the company starts to have success in exploring for oil in the Gulf, I think that could boost the stock's multiple, because Conoco hasn't historically been known for finding new resources," Cramer said.

Cameron International

Cramer said Cameron International provides equipment that makes exploration for oil and gas possible, both in the Gulf and elsewhere.

"Its products are used all over the world, both onshore and offshore, particularly in extremely challenging deepwater applications," Cramer said. "They have strong bookings and a rising backlog that gives them excellent earnings visibility over a multi-year period."

Disclosure: As of Monday April 29th Jim Cramer owned ConocoPhillips on behalf of his charitable trust.

Call Cramer: 1-800-743-CNBC

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