Over the last three months, shares in 88 Energy (LSE: 88E) have risen by 680%, delivering a stunning profit for some lucky shareholders.

In a fresh update this morning, 88 Energy said that the permeability of core samples taken from the Icewine#1 well on the North Slope of Alaska was “20 times better than pre-drill forecasts”. Apparently, the core samples had permeability reads that were “too high to be measured using the traditional method” for shale rocks.

Dave Wall, 88 Energy’s Managing Director, described these permeability numbers as “super highways”. In today’s update, Mr Wall said that these results add to previous analysis and suggest that despite being a tight oil play, Icewine could provide “production rates more akin to those normally experienced in conventional wells”.

This news may sound impressive, but I’m not sure it really adds much to previous updates. No new figures were provided today. It’s too early to say what the production potential might be.

There are also some risks. We know from a September presentation that 88 Energy plans to raise new funding or secure a farm-out partner in 2016. This is likely to dilute existing shareholders.

Another concern is that 88 Energy’s exploration costs will rise sharply in July, when the tax rebate available for exploration in Alaska falls from 75% to 35%.

My cautious view seems to be shared by the market, as 88 Energy’s share price hasn’t really moved this morning. In my view, this might be a good time to lock in some profits.

How to time this recovery play

Shares in wellhead technology manufacturer Plexus Holdings (LSE: POS) fell by 6% this morning. The firm reported a £3.5m loss for the six months to 31 December and said it would suspend dividend payments.

Sales halved from £13.5m to £6.8m during the second half of last year, but the group was able to raise £8m from new investor Jereh China through a placing of new shares. This has left Plexus with a cash balance of £10.5m and net cash of £4.4m.

I’m confident that Plexus will survive, as its POS-GRIP wellhead technology is used and respected by many major operators. However, short-term exploration activity in the North Sea — a key market — is expected to fall by 90%, according to Plexus. The firm is targeting markets further afield, but so far sales have been limited.

Plexus shares are now down by around 85% from their 2014 high. Multi-bagging gains are possible when a recovery starts, but the short-term outlook is poor. I suspect it may still be a little too early to buy.

Get paid while you wait

If you want exposure to the oil and gas sector without too much risk, I believe that BP (LSE: BP) could be a good option.

BP appears to be committed to maintaining its dividend, which currently offers a forecast yield of 7.9%. The group’s costs have fallen sharply and I suspect that when the oil market does start to recover, BP shares could easily rise by about 20%.

If I’m right, then an investment in BP could deliver a total return of about 35% over the next 2-3 years, at fairly low risk. I’ve bought some myself and believe that BP looks a good buy at the moment.

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Roland Head owns shares of BP. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.