U.S. energy behemoth
) paid $10 million in claims, arising from the massive fire
outbreak on its No. 4 Crude Unit of Richmond refinery on Aug 6,
2012. The amount was paid against medical compensation
To date, the company has received 23,900 claims since the date
of accident, according to a letter that Chevron officials sent to
the Contra Costa County Hazardous Materials Program - a health
department that serves local residents in case of emergencies.
Chevron suspended its operations at the No. 4 Crude Unit of
Richmond refinery after the fire outbreak. The unit performed the
initial refining activities of the crude oil that arrived at the
The devastating fire sent more than 15,000 people to emergency
rooms, while some 200 people sought medical help due to
respiratory problems. The 245,000 barrel a day unit - accounting
for one-eighth of the total refinery capacity of California State
- has been operating at 50% capacity since the date of the
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Chevron is almost through with repair work at its Richmond,
California, refinery crude unit. The facility is expected to be
online by the first quarter of 2013.
San Ramon, California-based Chevron displays a strong portfolio
of global projects, targeting volume growth of around 20% by
2017. Additionally, Chevron possesses one of the healthiest
balance sheets among its integrated peers, which include
Royal Dutch Shell plc
). Chevron's balance sheet strength helps it to capitalize on
investment opportunities with the option to make strategic
The company's financial flexibility and strong balance sheet are
real assets in this highly-uncertain period for the economy.
However, Chevron's production growth profile depends on the
timely development of upstream projects, almost all of which have
inherent risk factors. Time and cost overruns on these programs
may lead to lower returns going forward.
Chevron currently carries 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.