Chevron (CVX) Puts New Mexico & Texas Properties Up for Sale
Chevron Corporation (CVX), a major oil and gas producer in the United States, put its properties in New Mexico and Texas up for sale, continuing a previously observed trend of divesting Permian oil and gas holdings, according to documents seen by Reuters.
The company is looking to reduce its assets after making significant shale acquisitions. Chevron agreed to acquire shale operator PDC Energy Inc. in a $7.6 billion stock and debt deal last month. Prior to this, CVX increased its U.S. shale and international gas assets by purchasing Noble Energy in 2020.
Since quite some time, Chevron, which owns more than 2 million acres in the Permian Basin, has been selling some of its holdings there, accelerating the oil and gas dealmaking process. The company has also acquired other properties in the region, keeping aside $4 billion for the development of Permian basin this year.
Chevron has listed more than 2000 net acres in New Mexico, and approximately 30,000 acres in New Mexico and Texas for sale by auction, with bids due on Jul 27. According to Reuters, the entire area that’s up for sale is worth approximately $100 million.
The dealmaking is presumably a move to sell lower-valued assets in the area and choose high-performance assets. This strategy is perfectly in line with Chevron's long-term goals.
Zacks Rank & Key Picks
Currently, Chevron carries a Zack Rank #3 (Hold).
Some better-ranked stocks for investors interested in the energy sector are Evolution Petroleum Corporation EPM, NGL Energy Partners LP NGL and RGC Resources Inc. RGCO. While Evolution Petroleum sports a Zacks Rank #1 (Strong Buy), both NGL Energy Partners and RGC Resources carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Evolution Petroleum is an independent energy company. It was formed to acquire and develop oil and gas fields and apply both conventional and specialized technology to accelerate production, particularly in low-permeability reservoirs. EPM has witnessed an upward earnings estimate revision for 2023 and 2024 in the past 60 days.
NGL Energy Partners, headquartered in Tulsa, OK, is a limited partnership operating a vertically-integrated propane business with three operating segments — retail propane, wholesale supply and marketing, and midstream. NGL has witnessed an upward earnings estimate revision for 2024 in the past 30 days.
RGC Resources is a holding company that offers energy and associated products and services through its operational subsidiaries — Roanoke Gas Company and RGC Midstream, LLC. RGCO has thousands of customers through its natural gas distribution companies that serve the Roanoke Valley and Bluefield, Virginia and West Virginia areas.
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