(By Balachander) Chevron Corp. (NYSE: CVX) said its subsidiary will acquire an operating interest in liquefied natural gas (LNG) project in Western Canada from EOG Resources Inc. (NYSE: EOG) to boost its overall North America exploration and production portfolio.
Under the terms of the agreements, Chevron Canada will acquire a 50 percent operating interest in the Kitimat LNG project and proposed Pacific Trail Pipeline (PTP).
Additionally, Chevron Canada will acquire a 50 percent interest in roughly 644,000 acres of petroleum and natural gas rights in the Horn River and Liard Basins in British Columbia, Canada.
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"The Kitimat LNG development is an attractive opportunity that is aligned with existing strategies and will drive additional long-term production growth and shareholder returns," said Chevron vice chairman George Kirkland.
"While we still believe in the viability of the Kitimat project, our decision to exit is consistent with EOG's focus on domestic onshore crude oil production, which is generating more immediate reinvestment opportunities," said EOG CEO Mark Papa.
On Monday, CVX shares fell 0.70 percent to trade at $108.96, while EOG shares shed 0.32 percent to trade at $123.17.