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Chevron Corporation (CVX - Free Report) recently outlined its planned capital expenditure for 2024, focusing on strategic investments in both traditional and new energy sectors. The company expects to spend between $15.5 billion and $16.5 billion on capital projects for its consolidated subsidiaries, with an additional $3 billion allocated for affiliate ventures. This announcement not only signifies a financial plan but also serves as a roadmap for Chevron's commitment to sustainable growth and innovation.
Upstream Spending: A Vision for Development
Chevron's upstream spending for 2024 is poised at an impressive $14 billion, with a significant allocation to the United States. Approximately $6.5 billion is reserved for the development of Chevron's U.S. shale and tight portfolio. Within this, a noteworthy $5 billion is dedicated to the Permian Basin development, showcasing Chevron's commitment to harnessing the potential of this prolific resource.
A substantial 25% of U.S. upstream Capex is reserved for projects in the Gulf of Mexico. Among these, the Anchor project stands out with an objective to achieve its first oil in 2024. Chevron's strategic investments in this region underscore its dedication to diversification and tapping into diverse energy sources.
Downstream Capex: Fueling Growth
Chevron's downstream Capex for 2024 is projected to be approximately $1.5 billion, with a notable 80% allocated to the United States. This underscores Chevron's focus on boosting its domestic operations, contributing to local economies and ensuring a robust energy infrastructure.
Corporate and Other Capex: Driving Innovation
Corporate and other Capex within the broader financial plan are projected to be around $0.5 billion. This allocation emphasizes Chevron's commitment to driving innovation and exploring new frontiers in energy solutions.
Embracing Sustainability: Lower Carbon Capex
A substantial $2 billion is integrated into both upstream and downstream budgets, dedicated to lower carbon Capex. This initiative aims to reduce the carbon intensity of traditional operations while venturing into new energy business lines. Chevron's Geismar renewable diesel expansion project, scheduled to start in 2024, exemplifies the company's dedication to a greener future.
Affiliate Capex: Global Ventures
Chevron's affiliate Capex is strategically planned, with a significant portion allocated to Tengizchevroil's FGP / WPMP project in Kazakhstan. This global effort is poised to make a substantial impact, with the WPMP field conversion forecasted to begin in the first half of 2024. Additionally, Chevron Phillips Chemical Company's projects, including the Golden Triangle Polymer Project and Ras Laffan Petrochemical Project, reflect the company's commitment to diverse and impactful ventures.
Strategic Acquisitions: Paving the Way Forward
With the recent acquisition of PDC Energy, Chevron has expanded its annual Capex guidance to $14-$16 billion through 2027. Furthermore, the pending acquisition of Hess Corporation (HES - Free Report) , expected to close in the first half of 2024, positions Chevron's annual Capex budget between $19 billion and $22 billion. These strategic moves highlight Chevron's commitment to growth and pursuit of opportunities in the dynamic energy market.
Conclusion
Overall, Chevron's 2024 Capex plans demonstrate its commitment to both traditional energy production and investments in lower-carbon initiatives, positioning the company for long-term growth and shareholder value creation.
Zacks Rank and Key Picks
Currently, both CVX and HES carry a Zacks Rank #3 (Hold).
The Williams Companies is valued at $44.11 billion. The company currently pays a dividend of $1.79 per share, or 4.94%, on an annual basis.
WMB, the U.S.-based energy infrastructure company, operates through Transmission & Gulf of Mexico, Northeast G&P, West and Gas & NGL Marketing Services segments.
Liberty Energy is valued at $3.2 billion. LBRT currently pays a dividend of 28 cents per share, or 1.48%, on an annual basis.
LBRT is a leading provider of hydraulic fracturing and other auxiliary services to the North American onshore exploration and production companies.
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Chevron (CVX) Raises 2024 Capex, Eyes Lower Carbon Future
Chevron Corporation (CVX - Free Report) recently outlined its planned capital expenditure for 2024, focusing on strategic investments in both traditional and new energy sectors. The company expects to spend between $15.5 billion and $16.5 billion on capital projects for its consolidated subsidiaries, with an additional $3 billion allocated for affiliate ventures. This announcement not only signifies a financial plan but also serves as a roadmap for Chevron's commitment to sustainable growth and innovation.
Upstream Spending: A Vision for Development
Chevron's upstream spending for 2024 is poised at an impressive $14 billion, with a significant allocation to the United States. Approximately $6.5 billion is reserved for the development of Chevron's U.S. shale and tight portfolio. Within this, a noteworthy $5 billion is dedicated to the Permian Basin development, showcasing Chevron's commitment to harnessing the potential of this prolific resource.
A substantial 25% of U.S. upstream Capex is reserved for projects in the Gulf of Mexico. Among these, the Anchor project stands out with an objective to achieve its first oil in 2024. Chevron's strategic investments in this region underscore its dedication to diversification and tapping into diverse energy sources.
Downstream Capex: Fueling Growth
Chevron's downstream Capex for 2024 is projected to be approximately $1.5 billion, with a notable 80% allocated to the United States. This underscores Chevron's focus on boosting its domestic operations, contributing to local economies and ensuring a robust energy infrastructure.
Corporate and Other Capex: Driving Innovation
Corporate and other Capex within the broader financial plan are projected to be around $0.5 billion. This allocation emphasizes Chevron's commitment to driving innovation and exploring new frontiers in energy solutions.
Embracing Sustainability: Lower Carbon Capex
A substantial $2 billion is integrated into both upstream and downstream budgets, dedicated to lower carbon Capex. This initiative aims to reduce the carbon intensity of traditional operations while venturing into new energy business lines. Chevron's Geismar renewable diesel expansion project, scheduled to start in 2024, exemplifies the company's dedication to a greener future.
Affiliate Capex: Global Ventures
Chevron's affiliate Capex is strategically planned, with a significant portion allocated to Tengizchevroil's FGP / WPMP project in Kazakhstan. This global effort is poised to make a substantial impact, with the WPMP field conversion forecasted to begin in the first half of 2024. Additionally, Chevron Phillips Chemical Company's projects, including the Golden Triangle Polymer Project and Ras Laffan Petrochemical Project, reflect the company's commitment to diverse and impactful ventures.
Strategic Acquisitions: Paving the Way Forward
With the recent acquisition of PDC Energy, Chevron has expanded its annual Capex guidance to $14-$16 billion through 2027. Furthermore, the pending acquisition of Hess Corporation (HES - Free Report) , expected to close in the first half of 2024, positions Chevron's annual Capex budget between $19 billion and $22 billion. These strategic moves highlight Chevron's commitment to growth and pursuit of opportunities in the dynamic energy market.
Conclusion
Overall, Chevron's 2024 Capex plans demonstrate its commitment to both traditional energy production and investments in lower-carbon initiatives, positioning the company for long-term growth and shareholder value creation.
Zacks Rank and Key Picks
Currently, both CVX and HES carry a Zacks Rank #3 (Hold).
Investors interested in the energy sector might look at some better-ranked stocks like The Williams Companies (WMB - Free Report) , sporting a Zacks Rank #1 (Strong Buy), and Liberty Energy Inc. (LBRT - Free Report) , carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Williams Companies is valued at $44.11 billion. The company currently pays a dividend of $1.79 per share, or 4.94%, on an annual basis.
WMB, the U.S.-based energy infrastructure company, operates through Transmission & Gulf of Mexico, Northeast G&P, West and Gas & NGL Marketing Services segments.
Liberty Energy is valued at $3.2 billion. LBRT currently pays a dividend of 28 cents per share, or 1.48%, on an annual basis.
LBRT is a leading provider of hydraulic fracturing and other auxiliary services to the North American onshore exploration and production companies.