First cab off the rank is United Group (UGL), which is the last qualified bidder for offsite work on the NW Shelf, Train four expansion. UGL has a current bid of $1.5 billion, with much of this to be decided next month.

Carmichael likes this stock due to the company's strong order book. The company is also set to be included in the S&P 200 index in January 2002, which should result in a rise in the stock price. Carmichael recommends a 'buy'.

Another good buy, according to the broker, is Australian Worldwide Exploration Ltd (AWE). The company has made a significant oil discovery at Cliff Head in the Perth Basin. "The discovery of approximately 30 million barrels of oil boosts our evaluation for AWE by 34 cents per share, taking it to $1.65," according to Carmichael.

Carmichael added AWE is ready to participate, with free carried interest, in two highly prospective wells in the Carnarvon Basin which have a combined target of 330 mmbbls of oil. In addition, in February AWE is free carried in the Huinga well, targeting 500 bcf of gas and 30 mmbbls of condensate and LPGs.

Finally, there is Carpathian Resources which announced recently that oil flowed at a rate of 116 bpd from its Postorna-1 well, located in the Czech section of the Vienna Basin. Carmichael recommends a buy here as well.

Carmichael analyst, Mr Peter Strachan, said the flow rate was not a proper test and was significantly choked back by the equipment on site. "Given the permeabilities and porosities from the log data, it would not be unreasonable for Carpathian to achieve a flow rate of 800-1000 bopd with the right equipment," said Mr Strachan.