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DENVER - BKV Corporation (NYSE:BKV), a $1.87 billion market cap natural gas producer currently trading at $22.14, announced Monday it has signed an agreement with an unnamed diversified midstream energy company to develop a carbon capture and sequestration project at a natural gas processing plant in East Texas. According to InvestingPro analysis, BKV appears slightly undervalued based on its Fair Value metrics.
The new project, expected to be operational in early 2027, will capture approximately 70,000 metric tons of carbon dioxide annually from the existing plant. BKV will own the facility and handle compression, transportation, and permanent sequestration of the captured CO2 using a co-located Class II injection well, eliminating the need for high-pressure pipeline infrastructure.
This agreement expands on a previously announced carbon capture partnership between the companies at a separate South Texas location. BKV indicated the East Texas project may eventually be transferred to its recently announced carbon capture joint venture with Copenhagen Infrastructure Partners.
"Deepening our relationships with key partners demonstrates their confidence in our technical and operating expertise in developing and scaling carbon capture, utilization and sequestration projects," said Chris Kalnin, Chief Executive Officer of BKV. While the company maintains a healthy gross profit margin of 48.27%, InvestingPro data reveals analysts are optimistic about BKV’s future, projecting profitability for the current fiscal year despite recent challenges.
The East Texas facility adds to BKV’s growing carbon capture portfolio, which includes an operational project at the company’s Barnett Zero site in north Texas, the South Texas project, and the Cotton Cove CCS project scheduled to begin sequestration operations in the first half of 2027.
BKV, headquartered in Denver, ranks among the top 20 gas-weighted natural gas producers in the United States and is the largest natural gas producer by gross operated volume in the Barnett Shale, according to the press release statement. The company generated revenue of $689.57 million in the last twelve months, with analysts maintaining a strong buy consensus. For detailed analysis and additional insights, investors can access the comprehensive Pro Research Report available on InvestingPro.
In other recent news, BKV Corporation reported its first-quarter 2025 earnings, showcasing a robust financial performance that exceeded analyst expectations. The company achieved adjusted earnings per share of $0.41, surpassing projections, and generated a revenue of $216.13 million. This strong operational execution highlights BKV’s strategic focus on carbon capture and power generation. Additionally, Citi analysts have reiterated a Buy rating for BKV Corp, setting a price target of $29, following a visit to the company’s Temple power plants and the Barnett Zero carbon capture facility. Analysts noted the potential for a long-term power purchase agreement at the Temple facility, which could enhance capacity utilization without further investment. BKV’s recent finalization of a carbon capture joint venture has allowed the CEO to concentrate more on power operations, with upstream operations continuing to show improved efficiency. The company is also well-positioned to capitalize on the growing demand for low-carbon energy solutions, maintaining a low net leverage ratio and projecting strong upstream cash flow through 2026.
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