Chevron Asia Pacific Exploration and Production Company, an
Australian subsidiary of the U.S. energy behemoth,
), has acquired full operating interest in two blocks located in
the deepwater Bight Basin, 275 miles west of Port Lincoln, off
the coast of South Australia.
The offshore blocks S12-2 and S12-3 are spread over 8 million
acres. The acquisition is expected to add value to the company's
portfolio, with more exploration opportunities in Australia. The
move is in line with the integrated supermajor's plans of
expanding its asset base.
San Ramon, CA-based Chevron is one of the largest publicly traded
oil and gas companies in the world. It is engaged in oil and gas
exploration and production, refining and marketing of petroleum
products, manufacturing of chemicals and other energy-related
However, Chevron's earnings do not look pretty. Last quarter, the
company failed to beat the Zacks Consensus Estimate. We expect
this negative trend to continue when the company reports its
third quarter earnings on Nov 1.
Earlier this month, the company released a pre-earnings update
which supports our view. Per the interim update, Chevron expects
third quarter earnings to deteriorate from the previous quarter.
In the upstream activities, the update is slightly bullish with
oil production expected to be more the previous quarter. On the
flip side, the downstream sector outlook is negative as the
company expects substantially lower operating results than the
Chevron currently holds a Zacks Rank #4 (Sell), implying that
it is expected to underperform the broader U.S. equity market
over the next one to three months.
However, not all stocks in the energy sector have such gloomy
outlook. One can consider
Stone Energy Corp.
Seadrill Partners LLC
Linn Energy, LLC
) as good investment options. These stocks currently hold a Zacks
Rank #1 (Strong Buy) and are expected to significantly outperform
the market in the near term.
CHEVRON CORP (CVX): Free Stock Analysis
LINN ENERGY LLC (LINE): Free Stock Analysis
SEADRILL PTNRS (SDLP): Free Stock Analysis
STONE ENERGY CP (SGY): Free Stock Analysis
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