Chevron Hits Production Snag In Gulf Of Mexico

Chevron Corp. said late Monday one of its deepwater platforms in a Gulf of Mexico oilfield will be moved closer to the shore after some of its tethers, used to attach the platform to the seabed, were damaged. There have been no injuries or spills, the company said. The tethers had not yet been connected to the platform and the platform has not been damaged, Chevron said. The oilfield being targeted, Big Foot, is a $4.1 billion project that had been expected to come on line before the end of the year. If tethers were damaged when they sunk or cannot be installed before hurricane season, "we assume a 6-month delay to the project start-up," analysts at UBS said in a note to clients Tuesday. The impact on Chevron's production is likely to be minimal, however, with Big Foot expected to contribute about 1% to Chevron's production in 2016. While the delays may have "a modest financial impact" on the company, it raises concerns about "poor project execution" by the company and follows engineering design issues that have delayed a liquefied natural gas project in Angola, the analysts said. Shares of Chevron fell 0.4% Tuesday, while the S&P 500 Energy index rose 0.3%.