U.S. oil major
) is planning to build a solar thermal demonstration project at
its Kapolei refinery. The project, led by Chevron's Hawaii
operation, will be used to balance burning fossil fuels to
produce heat and steam for internal use.
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The site for the project is presently used to store equipment and
as a transitory staging and working area for other projects on
Chevrons' research and development team - Chevron Technology
Ventures - will deal with the project. However, the proposed
initiative also requires many permits, including a special
management area permit.
The 15.5-acre project, which is also known as "Chevron Hawaii
Concentrated Solar Process", is expected to be operational by
This venture will help Chevron in reducing costs and enhancing
efficiency as the business of refining crude oil into byproducts
is very expensive.
San Ramon, California-based Chevron Corporation 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 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.
Even though the bulk of Chevron's sales and earnings are
dependent on non-renewable energy sources like crude oil and
natural gas, the company also focuses on developing alternative
energy solutions. In this regard, Chevron has made strategic
investments in geothermal, solar technologies and other sources
of energy. It is also involved in the development of solutions,
which takes waste streams of organic material and converts them
into renewable energy that provides on-site power for waste-water
However, being one of the largest integrated oil and gas
companies in the world, Chevron is particularly susceptible to
the downside risk from continued weakness in the global economy.
We are also concerned about the company's high level of capital
spending, which may result in reduced returns going forward.
But there are certain other companies in the oil industry that
are expected to perform well in the coming 1 to 3 months. These
Royal Dutch Shell plc
) with a Zacks Rank #1 (Strong Buy), as well as
) with Zacks Rank #2 (Buy).