Chevron, A Dividend Champion In Trouble: What Is The Impact Of The Ecuadorian Judgment?
Caiman Valores • 52 Comments
Caiman Valores • 52 Comments
Why Chevron Is At Least 25% Overvalued
Thomas Lott • 107 Comments
Thomas Lott • 107 Comments
Sat, Jun. 25, 8:25 AM
- The U.S. currently pumps ~8.7M bbl/day of crude oil, 480K less than at the end of 2015, but more than 500K bbl/day of new crude from the Gulf of Mexico is set to come online this year and next, WSJ reports, threatening to prolong the oil glut and hold down prices.
- One reason is a handful of massive oil fields sanctioned for development years ago by companies such as BP and Freeport McMoRan (NYSE:FCX) that will start pumping later this year, but another is that companies have found that smaller satellite fields can be tapped inexpensively by tieback wells linked to existing offshore oil platforms via underwater pipelines.
- Exxon (NYSE:XOM) this year began pumping from the tieback Julia offshore well, with production piped back to a Chevron (NYSE:CVX) platform; CVX also recently executed a tieback that will produce 50% more oil and gas than it originally expected.
- Noble Energy (NYSE:NBL) nearly doubled its Gulf output in Q1 and has another well starting to pump later this summer; Anadarko (NYSE:APC) has more than 30 tieback well prospects in satellite fields, and will drill up to seven this year.
- Companies also are getting better at accessing deepwater finds; Shell (RDS.A, RDS.B) saved $1B drilling its Stones project, which will start up later this year, by using a slim-well design offshore engineers borrowed from onshore shale operations.
Fri, Jun. 24, 11:25 AM
- Chevron (CVX -1.7%) says drilling costs at Argentina’s massive Vaca Muerta shale play have dropped 20% this year, putting the company and its partners closer to meeting spending goals.
- Drilling costs at the Loma Campana field in Vaca Muerta have declined to $11.2M/well from $14M in the last three months of 2015, bringing the joint venture with YPF closer to the goal of drilling wells at less than $10M each, CVX's president for Latin America and Africa Ali Moshiri tells Bloomberg.
- The JV has drilled ~400 wells, and “the performance of those wells are coming very close, very competitive to the United States," Moshiri says.
Wed, Jun. 22, 11:43 AM
- Southern California refiners are bracing for potential disruptions ahead of possible blackouts this summer as state regulators to warn of power and gas shortages.
- On top of a heat wave that has swept the region, testing power grids that rely heavily on natural gas for fuel, power generators face strained gas supplies as SoCalGas' Aliso Canyon facility remains out of commission following last year's huge gas leak.
- Any stoppages at the refineries likely would cause gasoline prices to rise in California, already the largest and most expensive gasoline market in the continental U.S.
- Tesoro (TSO +0.1%), which operates two refineries in the region, says the Watson cogeneration facility at its Los Angeles refinery utilizes natural gas to produce steam to operate the refinery.
- Exxon Mobil (XOM -0.2%), Chevron (CVX -0.4%), Valero Energy (VLO +1.1%) and Phillips 66 (PSX +0.9%) also operate southern California refineries.
Fri, Jun. 17, 10:21 AM
- Chevron (CVX +0.2%) is looking for potential buyers for its Burnaby, B.C., refinery and gasoline stations, and Royal Dutch Shell (RDS.A, RDS.B) is soliciting interest in its Martinez, Calif., refinery, as they look to trim lower-margin assets, Reuters reports.
- CVX says it is testing the market for any interested buyers in the 55K bbl/day refinery, which may prove to be a better fit for a smaller buyer that focuses on a particular region or a company that concentrates on storage and trading but not oil production; Burnaby refines light oil, rather than heavy crude from Canada's oil sands, and its products are distributed in a smaller region around B.C. and into Washington state.
- Refining profit margins have dropped from 2015 highs and the fear is that as crude prices recover, refiners will be squeezed as the cost of oil rises but the price of gasoline does not keep pace, and selling the plants while margins are still reasonably high allows for an exit without balance sheet damage.
Wed, Jun. 15, 7:34 AM| Wed, Jun. 15, 7:34 AM | 2 Comments
Tue, Jun. 14, 2:26 PM
- Chevron (CVX -1.2%) remains the top pick among integrated oil companies at Cowen, which says the company's strategic and corporate objectives remain on track, with further growth potential in the Permian segment, Tengiz, and ongoing offshore appraisal as the cost structure comes down.
- Cowen sees CVX as firmly on the path that established it as the firm's top pick in the group, and continues to see an outperformance against commodity volatility this year with both commodity and corporate inflections realized in 2017.
- The firm expects CVX to fully fund the dividend against spending guidance at ~$52/bbl Brent prices, while continuing to forecast a cash surplus next year.
Fri, Jun. 10, 7:05 PM
- Western Colorado has 40x more natural gas than previously thought, potentially making it the second-largest formation in the U.S., according to a new estimate from the U.S. Geological Survey.
- The Mancos Shale formation in Colorado’s Piceance Basin holds ~66.3T cf of gas, up from just 1.6T estimated in 2003, the USGS says, and the revision puts the basin second only to the Marcellus Shale in terms of the largest total gas reserves in the U.S.
- Current prices of ~$2/MMBtu are considered too low for companies to begin drilling to any large extent; companies likely would begin drilling if prices reached $3.50/MMBtu, says David Ludlam of the West Slope Colorado Oil and Gas Association.
- Among Colorado's top current oil and gas producers: APC, NBL, ECA, XOM, CVX, OXY, WLL, BBG, SYRG, PDCE, BCEI, CRZO
Wed, Jun. 8, 8:27 AM
- Chevron (NYSE:CVX) apparently has been hit by another terror attack in Nigeria, as the Niger Delta Avengers claims it has blown up one of the company's wells.
- Nigeria's oil minister had said on Tuesday that the government would start talks with the group which has claimed responsibility for a string of attacks in the Niger Delta, but the group says it rejected the offer.
- A series of attacks on oil and gas pipelines in the southern Delta swamps have brought Nigeria's oil output to a 20-year low and have helped push crude oil prices to 2016 highs.
Tue, Jun. 7, 6:56 PM
- A Nigerian Senate committee asks Chevron (NYSE:CVX) to explain why a gas-to-liquids joint venture with the state-run oil company cost ~3x more to complete than initially estimated.
- The chairman of the gas committee says the $10.3B invested in the Escravos facility was “astronomical,” given it was supposed to be built for ~$3B, and CVX may have violated the JV contract terms because it failed to consult partner Nigerian National Petroleum on running over budget.
- The 33K bbl/day Escravos plant supplies clean-burning, low-sulfur diesel fuel for cars and trucks.
Tue, Jun. 7, 11:58 AM
- Chevron (CVX +2.2%) says its Unocal East China Sea subsidiary will ramp up production in the Luojiazhai and Gunziping gas fields, its biggest investment in China.
- CVX says it will use all three of its gas trains, with combined outlet capacity of 258M cf/day of natural gas, following the success of the first stage of the Chuandongbei project.
- CVX owns a 49% interest and China National Petroleum (NYSE:PTR) owns 51% of the $6.4B Chuandongbei project that covers more than 800 sq. km in Sichuan province and the Chongqing municipality, containing potentially recoverable natural gas resources of 3T cf.
Mon, Jun. 6, 3:48 PM
- The Chevron-led (CVX +0.5%) Angola liquefied natural gas export plant has launched a tender to sell its first cargo since it was unexpectedly shut down in April 2014.
- The tender reportedly is valid until June 15, one source said, and up to six more cargoes could be loaded before the facility goes offline for a final phase of testing.
- Resuming supply from Angola may bring a measure of relief to buyers as delays to new projects and supply outages have helped to boost spot LNG prices in recent weeks.
Mon, Jun. 6, 10:39 AM
- The U.S. Supreme Court rejects an appeal from the government of Ecuador contesting a $96M international arbitration award to Chevron (CVX +1.1%) stemming from a longstanding oil contract dispute.
- The court's refusal to hear the case leaves in place an August 2015 ruling by the U.S. Court of Appeals for the D.C. Circuit that upheld a 2011 award in CVX's favor from The Hague's Permanent Court of Arbitration in the Netherlands.
- The case is not part of a separate legal battle brought by a group of Ecuadorean villagers who claim Texaco caused billions of dollars in pollution damage in the country and are seeking to enforce a $9B judgment rendered in Ecuador against CVX.
Fri, Jun. 3, 9:09 AM
- The Niger Delta Avengers terror group claimed three new attacks on Nigeria's battered oil infrastructure overnight, promising to bring the country's oil production to "zero."
- The group says it blew up pipelines belonging to Royal Dutch Shell (RDS.A, RDS.B) and Eni (NYSE:E) early on Friday morning, just days after destroying two Chevron (NYSE:CVX) oil wells.
- Because the attacks were on infrastructure for oil streams already under force majeure, the immediate impact on Nigeria's exports was limited; the country's oil minister said yesterday that production remained ~1.6M bbl/day.
Wed, Jun. 1, 5:22 PM
- Kazakhstan’s government is seeking a greater share of profit from Karachaganak, the venture led by Royal Dutch Shell (RDS.A, RDS.B) and Eni (NYSE:E) that is the country’s second-biggest producing oil and gas field, Bloomberg reports.
- The government is in talks with the JV partners to change the formula in the production sharing agreement that determines the distribution of profit starting from this year, according to the report.
- Kazakhstan, which depends on energy products for ~75% of its exports, needs extra revenue to balance its budget after the collapse in energy prices.
- Shell took over 29.25% of Karachaganak when it acquired BG Group this year; Eni also holds a 29.25% stake, while Chevron (NYSE:CVX) owns 18% and state-run KazMunaiGaz has 10%.
Wed, Jun. 1, 4:58 PM
- A Who's Who of Big Oil - including Royal Dutch Shell (RDS.A, RDS.B), Chevron (NYSE:CVX), Exxon Mobil (NYSE:XOM), BP, Total (NYSE:TOT), Statoil (NYSE:STO), Repsol (OTCQX:REPYF, OTCQX:REPYY) and Mexico's Pemex are among the major players now registered to take part in Mexico’s deepwater oil auction to be held in December.
- The Mexican government hopes to see ~$7B in investment come in from the auction phase for what is reputed to be the most lucrative blocks in the Gulf of Mexico.
- “Exploration in deep water can take as long as eight years and production can be up to 10 years, so the current low prices don’t really have a big effect on these projects," says the president of Mexico’s National Hydrocarbons Commission.
Wed, Jun. 1, 8:05 AM
- Chevron’s (NYSE:CVX) RMP 23 and RMP 24 wells in Nigeria have been blown up, according to a Twitter statement from the Niger Delta Avengers, the terror group that recently has claimed responsibility for a string of attacks on oil and gas installations in the Niger Delta.
- Last week, the group said it assaulted CVX’s Escravos terminal in Nigeria, which damaged the Escravos tank farm main electricity feed pipeline, causing the shutdown of the company’s onshore activities in the Niger Delta.
- CVX has not commented on the recent attacks.
Chevron Corp. is an integrated energy company, which provides administrative, financial, management and technology support to U.S. and international subsidiaries that engage in fully integrated petroleum operations, chemicals operations, mining operations, power generation and energy services.... More
Sector: Basic Materials
Industry: Major Integrated Oil & Gas
Country: United States
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