Occidental Petroleum Monetizes Non-Strategic Permian Resources Acreage & Enhances Permian EOR Bus. Resulting in Higher Net Pr...
June 19 2017 - 9:35AM
Business Wire
Occidental Petroleum Corporation (NYSE:OXY) announced today that
it has agreed to a number of purchase and sale transactions in the
Permian Basin. On a combined basis, these transactions require no
net cash outlay and add approximately 3,500 barrels of oil
equivalent per day to the Company’s production. Occidental will
reduce its Permian Resources position by 13,000 net acres,
divesting non-strategic acreage in Andrews, Martin and Pecos
Counties and adding incremental acreage to enhance a future core
development area in Glasscock County. Occidental also agreed to
increase its ownership interests and assume operatorship of a CO2
enhanced oil recovery (EOR) property.
“These transactions support our pathway to breakeven at $50
after dividend and production growth and our long-term,
returns-focused value proposition. The combined results accelerate
cash flow and enhance our future returns by exchanging low-priority
development acreage for low decline, low capital intensity EOR
production that has significant opportunity for value improvement,”
said Vicki Hollub, President and Chief Executive Officer. “By
monetizing assets in the tail of the portfolio that were not
strategic to us, but are synergistic to other companies, we are
creating value for our shareholders.”
The net Permian Resources transactions will generate proceeds of
approximately $0.6 billion. The divested acres had no significant
near-term development plans while the acquired acreage provides
additional value within the future development area. The Permian
EOR transaction included the acquisition of working interests in
the Seminole-San Andres Unit, a premier CO2 flood, interests in the
Seminole Gas Processing Plant, source fields at Bravo Dome Unit and
West Bravo Dome Unit and the Sheep Mountain and Rosebud CO2
pipelines for $0.6 billion. Occidental has had an ownership
interest in these EOR assets since 2000. Seminole-San Andres Unit
will become Occidental’s largest domestic oil producing EOR
unit.
All the transactions are expected to close by the third quarter.
An updated investor presentation, which includes additional details
is available at:
http://www.oxy.com/investors/Earnings/Pages/Investor-Presentations.aspx.
About Occidental
Petroleum
Occidental Petroleum Corporation is an international oil and gas
exploration and production company with operations in the United
States, Middle East and Latin America. Headquartered in Houston,
Occidental is one of the largest U.S. oil and gas companies, based
on equity market capitalization. Occidental’s midstream and
marketing segment gathers, processes, transports, stores, purchases
and markets hydrocarbons and other commodities. The company’s
wholly owned subsidiary OxyChem manufactures and markets basic
chemicals and vinyls. Occidental posts or provides links to
important information on its website at www.oxy.com.
Forward-Looking
Statements
Portions of this press release contain forward-looking
statements and involve risks and uncertainties that could
materially affect expected results of operations, liquidity, cash
flows and business prospects. Actual results may differ from
anticipated results, sometimes materially, and reported results
should not be considered an indication of future performance.
Factors that could cause results to differ include, but are not
limited to: global commodity pricing fluctuations; supply and
demand considerations for Occidental’s products;
higher-than-expected costs; the regulatory approval environment;
not successfully completing, or any material delay of, field
developments, expansion projects, capital expenditures, efficiency
projects, acquisitions or dispositions; uncertainties about the
estimated quantities of oil and natural gas reserves;
lower-than-expected production from development projects or
acquisitions; exploration risks; general economic slowdowns
domestically or internationally; political conditions and events;
liability under environmental regulations including remedial
actions; litigation; disruption or interruption of production or
manufacturing or facility damage due to accidents, chemical
releases, labor unrest, weather, natural disasters, cyber-attacks
or insurgent activity; failure of risk management; changes in law
or regulations; reorganization or restructuring of Occidental’s
operations; or changes in tax rates. Words such as “estimate,”
“project,” “predict,” “will,” “would,” “should,” “could,” “may,”
“might,” “anticipate,” “plan,” “intend,” “believe,” “expect,”
“aim,” “goal,” “target,” “objective,” “likely” or similar
expressions that convey the prospective nature of events or
outcomes generally indicate forward-looking statements. You should
not place undue reliance on these forward-looking statements, which
speak only as of the date of this release. Unless legally required,
Occidental does not undertake any obligation to update any
forward-looking statements, as a result of new information, future
events or otherwise. Material risks that may affect Occidental’s
results of operations and financial position appear in Part I, Item
1A “Risk Factors” of the 2016 Form 10-K.
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version on businesswire.com: http://www.businesswire.com/news/home/20170619005723/en/
Occidental Petroleum CorporationMedia:Melissa E.
Schoeb713-366-5615melissa_schoeb@oxy.comorInvestors:Richard A.
Jackson713-215-7235richard_jackson@oxy.comOn the web:
www.oxy.com
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