Chevron's CVX 50%-owned Tengiz field expansion project in Kazakhstan will conduct only critical work due to the novel coronavirus outbreak. The critical work includes building of pipelines in Kazakhstan or construction of equipment in South Korea, which will be used in the project. The venture has suspended all construction work related to basic production.
The venture is run by Kazakhstan’s biggest oil producer Tengizchevroil (“TCO”) – which is 50% owned by Chevron, while 25%, 20% and 5% is held by Exxon Mobil Corporation (NYSE:XOM) XOM, Kazakhstan's state energy firm KazMunayGas and Russia's Lukoil, respectively.
Kazakhstan has confirmed more than 1000 coronavirus cases, including a small outbreak at a workers' camp close to the Tengiz field.
With an aim to ensure safety and curtail the impact of COVID-19 on its operations and construction activities, TCO will reduce activities and personnel, and continue only essential activities critical to the project. However, the duration of the work stoppage or its impact on the project’s production is unknown.
In the meantime, Chevron has reiterated its commitment toward the expansion of the $45-billion project.
In 1993, Chevron was awarded the rights to develop Tengiz. According to the company, the Tengiz oil field's reservoir is located 12,000 feet below ground level, which makes it the world's deepest operating super-giant oil field.
About the Company
San Ramon, CA-based Chevron is one of the largest publicly-traded oil and gas companies in the world in terms of 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 carries Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked players in the energy sector are Murphy USA Inc. MUSA and BP (LON:BP) Midstream Partners LP BPMP. Both stocks sport a Zacks Rank #2 (Buy).
(We are reissuing this article to correct a mistake. The original article, issued on Apr 16, 2020, should no longer be relied upon.)
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