U.S. oil major
) announced that it carried out a production test at St. Malo
PS003 well located in the deepwater Gulf of Mexico. The attempt
was successful, with oil flow rate reported to be over 13,000
barrels per day.
Chevron has 51% ownership in the St. Malo field, while the other
Petroleo Brasileiro SA, or Petrobras
Exxon Mobil Corporation
) and ENI, with interests of 25%, 21.5%, 1.25% and 1.25%,
Together with St. Malo, Chevron is conducting development of the
Jack field in the deepwater Gulf of Mexico. According to Chevron
management, the total estimated cost for the initial phase of
development of both the projects is $7.5 billion. The St. Malo
and the Jack fields are expected to come online in 2014.
Management believes that both the fields are expected to boost
the output of the company after they start their production in
2014. The projects are also expected to produce energy for
domestic purposes for decades.
Chevron has also spent $4.1 billion for the development of Big
Foot project in the deepwater U.S. Gulf of Mexico. Production
from this field is expected to start in 2014.
Management expects peak production from Jack, St. Malo and Big
Foot fields to be roughly 100,000 barrels of oil equivalent per
San Ramon, California-based Chevron is one of the largest
publicly traded oil and gas companies in the world, based on
proved reserves. It is engaged in oil and gas exploration and
production, refining and marketing of petroleum products,
manufacturing of chemicals, and other energy-related businesses.
Chevron's current oil and gas development project pipeline is
among the best in the industry, targeting volume growth of 20% by
2017 - more than twice the rate of growth from 2003 to 2010 -
driven by the big Australian gas projects (Gorgon and
However, the company's results are directly exposed to oil and
gas prices, which are inherently volatile and subject to complex
Chevron currently retains a Zacks Rank #3 (Hold), implying that
it is expected to perform in line with the broader U.S. equity
market over the next 1 to 3 months.
CHEVRON CORP (CVX): Free Stock Analysis
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