Chevron Sticks to Fracking Plans Despite Low Gas Prices

Despite low natural gas prices, Chevron looks intent on pushing into the natural gas market in the U.S. The company plans to double its drilling in the Marcellus play this year while also drilling a few exploration wells in the Utica play despite gas prices touching their lowest point in a decade, making shale exploration less profitable. ^[1]

Chevron’s decision to press on with shale exploration mirrors that of rival Exxon Mobil, which has decided against production cuts. Companies like ConocoPhillips on the other hand have announced that they would reduce spending on natural gas resources in North America.

However, we anticipate that gas prices will recover longer term, and its commitment to natural gas exploration could add significant value to the company as depicted by our sum of the parts analysis.

http://www.forbes.com/sites/greatspeculations/2012/03/12/chevron-sticks-to-fracking-plans-despite-low-gas-prices/