Core Insights - California Resources has established a strong position in California's independent exploration and production sector, holding significant mineral rights and a diverse portfolio of oil and gas plays, with 81% of its proved reserves located in the San Joaquin Basin [1][6] - Wells Fargo analysts have initiated an Overweight rating on California Resources and Tamboran Resources, highlighting their unique asset mixes and upcoming catalysts for 2026 [3][14] - The energy sector is experiencing a complex evolution driven by decarbonization efforts and local economic factors, impacting investment strategies [5] California Resources - The company produced 137,000 barrels of oil equivalent per day in the second and third quarters of the year, with crude oil making up approximately 78% of this total [6] - California Resources reported a revenue of $855 million in 3Q25, down over 36% year-over-year, but beat earnings expectations with a non-GAAP EPS of $1.46, up from $1.10 in 2Q25 [8] - The company is involved in carbon capture and storage through its Carbon TerraVault project, partnering with Brookfield Renewable to develop CCS opportunities [7][10] - Analyst Margolin believes CRC shares are trading at their PDP value, with potential for significant upside, setting a price target of $58, indicating a 21.5% increase [10] Tamboran Resources - Tamboran operates in the unconventional natural gas sector in Australia's Northern Territory, with a focus on tapping into the Beetaloo/MacArthur basin [11][12] - The company has not yet begun commercial production and is currently operating at a loss, raising $56.1 million through a public offering and planning additional fundraising [13] - Analyst Margolin highlights the potential for high output and earnings from Tamboran's assets, with a price target of $35 suggesting a 36% upside [14]