Dividends and Congo oil find could quadruple national output

When you think about oil reserves you likely think about the West Texas Shale, Middle eastern oil but have you thought abut the country of Congo in Africa? Along the same plan as Nigeria and in the center of Africa is the Democratic Republic of Congo. In mid August, the national oil company announced a major find which if proven could bring the DRC into Africa’s major oil producers. In recent months, Italy’s ENI and France’s Total have found oil, but the SARPD Oil find of roughly 1 billion hydrocarbons of which 359,000 million barrels of oil or possible production of 983,000 barrels a day.

This one find could bring in $10.5 billion into the DRC which would roughly double the existing GDP or things could change drastically in the Congo. More drilling and more pipelines will be needed.

Linking to dividend paying stocks, unlike the resource industry where there is a constant search for profitable resource extraction, one is looking for reasonably consistent cash flows on a yearly basis. In the resource industry, once the find is made and there is a healthy long term royalities there is a desire to own the stock. In the non resource sector, you are looking for relatively boring industries but have service agreements on a long term basis. Then you do not need to worry until the dividend flows in and you can decide how to allocate it.

There are more questions than answers, till the next time – to raising questions.

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