U.S. oil major
) announced the discovery of oil at Coronado prospect, located in
the Gulf of Mexico. The Walker Ridge Block 98 Well No. 1 well -
situated roughly 190 miles off the Louisiana coast, in water
depth of around 6,127 feet - has been drilled to a depth of
Chevron added that it is currently appraising the oilfield to
determine the scale of reserves and its commercial viability.
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Chevron holds 40% operating interest in the prospect, with
), Venari Offshore LLC and an affiliate of
Anadarko Petroleum Corporation
) controlling 35%, 10% and 15% interest, respectively.
We believe that Chevron's latest exploration success will boost
the company's growth prospects in Gulf of Mexico by adding to its
already significant line up of projects in the region's prolific
Lower Tertiary Trend.
As one of the largest lease holders in the Gulf of Mexico,
Chevron is also developing Jack/St. Malo and Big Foot oil field
projects. The developments are expected to commence production in
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.
The company divides its operations into three main segments:
Exploration and Production; Manufacturing, Products, and
Transportation; and Other Businesses.
Chevron is one of the largest integrated energy companies in the
world and has an impressive business model. Its current oil and
gas development project pipeline is among the best in the
industry, boasting large multi-year projects.
However, being one of the largest integrated oil and gas
companies in the world, Chevron is susceptible to the downside
risk from the continued weakness in the global economy. We are
also concerned about the company's high capital spending, which
may result in reduced returns going forward.
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 one to three months.
One firm in the energy sector that is expected to significantly
outperform the equity markets in the next one to three months is
Helmerich & Payne Inc
). The stock carries a Zacks Rank #1 (Strong