Amberjack Pipeline Company LLC, a joint venture of Chevron Pipe Line Company and Shell Pipeline Company LP, received approval for the installation of crude oil pipeline in the U.S. Gulf of Mexico (“GoM”). Chevron Pipe Line Company is an indirectly, wholly owned subsidiary of Chevron Corporation (CVX) while Shell Pipeline Company LP is an affiliate of Royal Dutch Shell plc (RDS.A).
The proposed pipeline, about 36 miles long and 24 inches thick, will extend from the Jack and St. Malo fields in the deepwater GoM to a platform in Green Canyon Block 19 (GC19), owned and operated by Shell. Chevron Pipe Line, on part of Amberjack, will construct the pipeline and act as an operator for this project.
Following the completion of installation of the pipelines, Chevron will use its services for the Jack/St. Malo hub production facility, which is expected to start operation in 2014 with an initial production capacity of 170,000 barrels of oil per day. This pipeline is extremely significant for Chevron, connecting the deepwater oil fields to existing pipelines and gulf coast facilities.
In another development, Chevron Energy Solutions – a unit of Chevron Corporation – along with Oceanic Time Warner Cable and Tioga Energy, announced the start-up of the construction of a major solar project at Mililani Technology Park in Hawaii. Oceanic Time Warner Cable is a unit of Time Warner Cable (TWC).
As a part of the 856-kilowatt solar system, Chevron Energy will be involved with the designing, engineering and construction of solar photovoltaic panels on two buildings and parking canopies. Tioga Energy will be the owner of the project and will provide finance and operate the system. The generated electricity will be sold to Oceanic Time Warner Cable over the next 20 years.
As per Chevron’s spokesperson, this largest solar project of Oahu will contribute immensely toward State of Hawaii’s target of clean energy goals and help in the establishment of the utilization of renewable sources of energy. The project will likely be completed in the first quarter of 2011.
We are maintaining our long-term Neutral recommendation on the stock. Chevron currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.
CHEVRON CORP (CVX): Free Stock Analysis Report
ROYAL DTCH SH-A (RDS.A): Free Stock Analysis Report
TIME WARNER CAB (TWC): Free Stock Analysis Report
Zacks Investment Research
