Why would anyone want to buy an oil producer right now? News of layoffs, capital cuts, and slashed dividends continues to flow out of western Canada, and the market is starting to see some troubled companies sell off assets or even disappear completely.

If things weren’t bad enough, the recent NDP victory in Alberta has cast another dark cloud over an industry already battling a perfect storm, and OPEC remains determined to ratchet up production in its ongoing effort to protect market share.

It’s true that prices have firmed up a bit, but forecasts for the future direction of oil and gas markets are all over the map.

In their search for “deals,” many investors are buying beaten-up names that could double quickly on a sharp rebound, but that strategy comes with big risks because those names might not survive long enough to see those better days.

At this point, it might be best to stay away, but for investors still keen on buying the sector it makes sense to go with a safe name.

With that thought in mind, here are the reasons why I think energy investors should consider adding Canadian Natural Resources Ltd. (TSX:CNQ)(NYSE:CNQ) to their portfolios.

1. Strong balance sheet

Consolidation in the industry is inevitable and will eventually be a good thing as the bigger firms with solid balance sheets absorb the highly leveraged players who can no longer afford to stay in business.

Canadian Natural finished Q1 2015 with a debt-to-book capitalization of 36% and debt to EBITDA of 1.7 times. This give the company lots of room to raise the funds it will need to make strategic acquisitions as the fire sales start to ramp up.

The company also has more than $3 billion available in undrawn lines of credit.

2. Diversified assets

Canadian Natural probably owns the best portfolio of assets in the Canadian energy patch. These include light, medium, and heavy crude oil, oil sands, natural gas, and natural gas liquids.

Most of the assets are concentrated across the western Canadian provinces, but the company also has interests in the North Sea and offshore Africa.

Unlike many of its competitors, Canadian Natural tends to retain 100% ownership of its properties. This gives the company an advantage in that it can easily move capital around to maximize returns depending on shifts in the commodity markets or tax policies.

For example, the new NDP government in Alberta plans to review royalty rates and increase corporate taxes. Canadian Natural might decide to shift a significant part of its planned capital expenditures to British Columbia, where it has vast undeveloped land holdings.

3. Cost control and operating efficiency

Canadian Natural is doing a good job of navigating through the oil rout. In Q1 the company reduced year-over-year operating costs by 22% in its liquids production and by 10% in its natural gas operations.

The company also found another $300 million in capital cuts, raised the dividend, and still expects to grow overall production by 11% this year.

Should you buy Canadian Natural Resources?

Many analysts say Canadian Natural Resources is too expensive given the state of the market. The stock certainly isn’t cheap, but a top quality company with world-class assets and a rock solid management team rarely goes on sale. If you believe in the long-term oil story, and want to be sure you are buying a winner, Canadian Natural is a good pick for your portfolio.

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Fool contributor Andrew Walker has no position in any stocks mentioned.