Integrated energy behemoth,
), pulled the plug on the Lithuania tender to explore shale gas
in the western part of the country. The company cited changes in
law as the reason for this move.
The San Ramon, California-based company was the sole bidder to
explore the 1,800 square kilometers Silute-Taurage area for
unconventional hydrocarbons and had won the bid last month.
Lithuania estimates that the prospect could hold as much as 80
billion cubic meters of technically recoverable shale gas.
Chevron believes that the fiscal, regulatory and legislative
changes that took place after it placed the bid in Jan 2013 made
the venture less fruitful. Moreover, several other legislative
acts have been passed after the company won the bid last month
and many more are under discussion. This makes it difficult to
identify the true potential of the prospect.
Chevron's move to back out from the project could prove costly
for Lithuania as the Baltic state receives its full requirement
of gas from Russia and had earlier stated that it was being
overcharged by the Russian gas behemoth Gazprom. Choosing Chevron
for the tender was a move by the government to reduce this
dependence on Russia.
However, Chevron has not withdrawn completely from Lithuania. It
plans to continue its exploration activities in the 2,400 square
kilometer Rietavas block that it currently holds.
Chevron is one of the largest publicly traded oil and gas
companies in the world and is engaged in oil and gas exploration
and production, refining and marketing of petroleum products,
manufacturing of chemicals and other energy-related
Chevron currently holds a Zacks Rank #3 (Hold), implying that
it is expected to perform in line with the broader U.S. equity
market over the next one to three months.
Meanwhile, there are certain other companies in the energy
sector that are expected to perform better in the short term.
These include Zacks Ranked #1 (Strong Buy)
Stone Energy Corp.
Pembina Pipeline Corporation
CHEVRON CORP (CVX): Free Stock Analysis
DRIL-QUIP INC (DRQ): Free Stock Analysis
PEMBINA PIPELN (PBA): Free Stock Analysis
STONE ENERGY CP (SGY): Free Stock Analysis
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