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A lit trademark sign beacons customers to the Highland Village Chevron gas station in Jackson, Miss., Thursday, Oct. 29, 2009. Chevron’s plans to develop a vast gas project in Kitimat, B.C., have just been dealt a blow. Apache Corp., the energy giant’s partner, said last week that it wants out.
A lit trademark sign beacons customers to the Highland Village Chevron gas station in Jackson, Miss., Thursday, Oct. 29, 2009. Chevron’s plans to develop a vast gas project in Kitimat, B.C., have just been dealt a blow. Apache Corp., the energy giant’s partner, said last week that it wants out.
(Rogelio V. Solis/AP)

Chevron’s Kitimat LNG delay is a blessing in disguise

Chevron Corp.’s plans to develop a vast gas project in British Columbia have just been dealt a blow. Apache Corp., the energy giant’s partner, said last week that it wants out. That may seem a setback to Chevron’s attempts to boost flagging production, but it’s actually a blessing in disguise.

The Kitimat venture is a costly one, requiring an estimated $15-billion (U.S.) to get it up and running. Chevron has already been splashing out cash on a variety of monster fields. That’s what pushed capital spending up to almost $20-billion in the six months to June, the company reported in its second-quarter earnings on Friday. That’s a 7-per-cent increase on the same period last year and surpassed cash generated from operations by $2.6-billion.