Chevron’s Profits Down, Complications with Concessions

Chevron’s Profits Down, Complications with Concessions

After posting higher profits than any other oil major last year, Chevron’s stock has badly slipped in 2015—down more than 30%, noted the Wall Street Journal in a recent report.

The company has seen its stock slide as global oil prices are leaving some of its more ambitious projects dangerously exposed. One such project has been Chevron’s Gorgon LNG, the world’s most expensive at an estimated $54b. Located in Western Australia, the project has required expensive pipelines to get natural gas to the sea, and further investment to convert the gas into LNG once it arrives.

Plagued by cost overruns and construction delays, the project faces even more risk as Reuters reports that contracted buyers may be backing out as spot prices for LNG are cheaper than their contracts.

“If there’s spot supply that’s cheaper than Chevron’s offer price, then we’ll not take from Chevron,” said a senior official, who declined to be identified, from a Japanese firm.


Welcome! Login in to your account

Remember me Lost your password?

Don't have account. Register

Lost Password