Chevron and Transocean Face Headwinds
Injunctions have been filed against Chevron (NYSE:CVX) and Transocean (NYSE:RIG) regarding their role in a 3,700-barrel offshore oil spill in Brazil last November.
Transocean was told to halt operations on its nine Brazilian rigs within 30 days. Brazil accounts for about 11 percent of Transocean’s revenue. Analysts at Tudor Pickering Holt said that the ruling has been appealed and ultimately think that the production will resume.
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Transocean was also recently awarded a massive contract by Royal Dutch Shell for four ultra-deep drill ships.
On September 27, Chevron paid a $17.3 million fine to Brazil’s National Petroleum Agency. The company had stopped production at the Frade field in March after traces of oil were found in the area. Both Chevron and the ANP say that the oil found there was not from the Frade field.
Both companies deny any wrongdoing in the accident, and have promised to appeal the injunctions.
In other energy news, Exxon Mobil (NYSE:XOM) announced a $200 million plan to expand two of its Louisiana chemical facilities. The project, scheduled for completion in 2014, will add 45 jobs to the state, and provide a $1.8 million modernization tax credit to the company.