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Chevron (CVX) Explores Options for Haynesville Assets in Texas
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Chevron Corporation (CVX - Free Report) is in the initial stages of evaluating alternatives for approximately 70,000 net acres of land in East Texas' Haynesville shale formation, following a temporary development pause earlier this year, per a Reuters report.
Per the report, a full sale of the assets is among considerations as the energy giant aims to divest up to $15 billion in assets over the next five years. The decision to explore options for the Haynesville shale assets follows Chevron's recent substantial $53 billion acquisitionof Hess Corporation (HES - Free Report) .
Chevron's focus on divestments is part of a broader effort to enhance its financial flexibility and concentrate on high-value, high-return assets. The Haynesville assets, if sold, are anticipated to attract significant interest due to their proximity to existing and planned liquefied natural gas export projects along the U.S. Gulf Coast.
While there’s a possibility of a full sale, Chevron may also explore partnerships with other producers in the region for joint development. Bankers and industry insiders estimate the value of the Haynesville assets to be in the low hundreds of millions of dollars. Chevron, which temporarily halted development activities in July as part of its routine business planning, produces around 40 million cubic feet equivalent per day of natural gas from a portion of the Haynesville holdings.
However, the ultimate valuation is subject to various factors, including commodity price forecasts and potential bidders' assessments of the land's untapped potential. With much of the land yet to be developed, this move by Chevron could attract buyers seeking to strengthen their position in the basin. This is also in sync with the current investors’ preference for companies with substantial reserves.
Matador Resources is among the leading oil and gas explorers in the shale and unconventional resources in the United States. The company’s prime intention is to create more value for shareholders and generate lucrative returns from the capital invested in unconventional plays. MTDR has witnessed an upward earnings estimate revision for 2024 over the past 30 days.
MTDR’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 13.89%.
Liberty Energy is a North American provider of hydraulic fracturing services to upstream energy operators. The company’s multi-basin presence offers an attractive upside opportunity compared to most of its peers. Liberty's strong relationship with high-quality customers provides revenue visibility and business certainty. LBRT has witnessed an upward earnings estimate revision for 2023 and 2024 over the past 30 days.
The company’s earnings beat estimates in three of the trailing four quarters and missed once, delivering an average surprise of 9.88%.
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Chevron (CVX) Explores Options for Haynesville Assets in Texas
Chevron Corporation (CVX - Free Report) is in the initial stages of evaluating alternatives for approximately 70,000 net acres of land in East Texas' Haynesville shale formation, following a temporary development pause earlier this year, per a Reuters report.
Per the report, a full sale of the assets is among considerations as the energy giant aims to divest up to $15 billion in assets over the next five years. The decision to explore options for the Haynesville shale assets follows Chevron's recent substantial $53 billion acquisitionof Hess Corporation (HES - Free Report) .
Chevron's focus on divestments is part of a broader effort to enhance its financial flexibility and concentrate on high-value, high-return assets. The Haynesville assets, if sold, are anticipated to attract significant interest due to their proximity to existing and planned liquefied natural gas export projects along the U.S. Gulf Coast.
While there’s a possibility of a full sale, Chevron may also explore partnerships with other producers in the region for joint development. Bankers and industry insiders estimate the value of the Haynesville assets to be in the low hundreds of millions of dollars. Chevron, which temporarily halted development activities in July as part of its routine business planning, produces around 40 million cubic feet equivalent per day of natural gas from a portion of the Haynesville holdings.
However, the ultimate valuation is subject to various factors, including commodity price forecasts and potential bidders' assessments of the land's untapped potential. With much of the land yet to be developed, this move by Chevron could attract buyers seeking to strengthen their position in the basin. This is also in sync with the current investors’ preference for companies with substantial reserves.
Zacks Rank & Key Picks
Chevron currently carries a Zacks Rank #3 (Hold).
A couple of better-ranked stocks in the energy sector are Matador Resources Company (MTDR - Free Report) and Liberty Energy Inc. (LBRT - Free Report) , each currently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Matador Resources is among the leading oil and gas explorers in the shale and unconventional resources in the United States. The company’s prime intention is to create more value for shareholders and generate lucrative returns from the capital invested in unconventional plays. MTDR has witnessed an upward earnings estimate revision for 2024 over the past 30 days.
MTDR’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 13.89%.
Liberty Energy is a North American provider of hydraulic fracturing services to upstream energy operators. The company’s multi-basin presence offers an attractive upside opportunity compared to most of its peers. Liberty's strong relationship with high-quality customers provides revenue visibility and business certainty. LBRT has witnessed an upward earnings estimate revision for 2023 and 2024 over the past 30 days.
The company’s earnings beat estimates in three of the trailing four quarters and missed once, delivering an average surprise of 9.88%.