RPT-INVESTMENT FOCUS-Brazil seen juicing oil shares in riskier world
(Repeats Aug. 15 story; no changes to text)
* Selected energy firms set to rally over next two years
* Total, Galp, Repsol shares to get most production boost
By Tricia Wright
LONDON, Aug 15 (Reuters) - The promise of production growth in offshore Brazilian and West African oilfields is luring investors to a select batch of European energy firms as geopolitical uncertainty elsewhere weighs on the broader sector.
Portugal's Galp and Spain's Repsol, more exposed than most to lucrative exploration zones deep under Brazil's seabed, as well as France's Total on Angola exposure, are seen as the pick of the bunch as BP and Royal Dutch Shell suffer from weak exploration results.
At a time of increased tension and conflict in Russia and the Middle East, there are few clear signals elsewhere in the energy sector: oil prices have fallen back to around $95-$100 per barrel but are still historically high, while the energy sector's dividend yield has helped it outperform this year.
Brazil is reckoned by analysts to be the biggest area of production growth over the next few years outside of the United States, just as Angola is seen offering the best opportunity in Africa.
Some of this is already reflected in company valuations, especially for Galp, which is trading at a forward price-to-earnings ratio of 30.75 versus a median of 12.47 for a basket of eight oil companies. Continuación...