Chevron Corporation CVX, an integrated oil major, finally announced its intention to proceed with the second stage of its multibillion dollar Gorgon LNG project in Western Australia’s north-west coast.

Gorgon LNG project is the largest single resource project in Australia, dealing with the delivery of natural gas to international and domestic customers. The $69 billion project is one of the costliest energy projects, employing more than 10,000 people to construct the processing facility at Barrow Island. The Gorgon LNG project has a shipment capacity of 15.6 million metric tons per year.

The project has faced several hindrances in production since it dispatched its first cargo in March 2016. Since then, more than 250 cargoes have been dispatched to Asia.

While Chevron is the chief operator of Gorgon LNG project holding 47.3% stake, Exxon Mobil Corporation XOM and Royal Dutch Shell PLC RDS.A own 25% interest each. The remaining stakes are held by Osaka Gas, Tokyo Gas and Chubu Electric Power.

Chevron and its partners in the project plan to sink eleven new wells in Gorgon and Jansz-Io fields. They also intend to build offshore pipelines and subsea structures to pipe the gas to the LNG plant on Barrow Island. The drilling is likely to commence next year with the project expected to be completed after 4 years.

The second stage of the project involves a capital investment of around $5.1 billion. The investment in the second stage of the project would fit within Chevron’s planned annual investment of $18-$20 billion through 2020. Apart from leading to creation of jobs and boosting the local economy, the expansion of the project is likely to boost the domestic supply of gas from 200 terajoules (TJ) to about 300 TJ a day.

Zacks Rank and Key Picks

Headquartered in California, Chevron is one of the largest publicly-traded oil and gas companies in the world, based on proved reserves. It is engaged in oil and gas exploration and production, refining and marketing of petroleum products, manufacturing of chemicals, and other energy-related businesses. The company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Meanwhile, one can consider a better-ranked stock, PetroChina Company Limited PTR, which is a Zacks #1 Ranked company within the same industry. The company delivered an average positive earnings surprise of 21.99% in the trailing four quarters.

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