Occidental Petroleum Corp. on Aug. 10 posted a $8.35 billion second-quarter loss on lower energy prices and write-downs as the U.S. oil producer has been trying to reduce debt amid a pandemic that has sapped fuel demand and prices.
Occidental, which borrowed heavily to finance last year's $38 billion purchase of rival Anadarko Petroleum, cut the value of its oil and gas properties by $6.6 billion, joining BP Plc, Chevron Corp. and Total SA in massive write-downs as the industry now expects energy prices to stay low for years.
Its oil and gas production will fall 13% this quarter over last, and another 5% in the fourth quarter, to 1.16 million bbl/d of oil and gas, the company said. In the Permian Basin, where it became the largest operator through the Anadarko purchase, shale output will drop 37% this year, it said.
Shares fell nearly 6% in late trading after rising $1.03 at $16.48. The stock is down 61% so far this year.
The average price Occidental received for crude oil plummeted about 61% to $23.17/bbl in the second quarter as oil prices crashed. It has cut jobs, slashed its dividend, reduced spending plans and sold assets to shore up its finances.
It expects to receive $2 billion or more in asset sales, according to the presentation.
Among the assets Occidental is trying to sell is a package of land and minerals in Wyoming and Colorado. The company has said that it hopes to close that sale in the fourth quarter.
Its net loss was $8.35 billion, or $9.12 per share, in the quarter, compared with earnings of $635 million, or 84 cents per share, a year earlier.
Excluding one-time items, the company lost $1.76 per share, compared with analysts' average estimates of $1.68, according to Refinitiv IBES.
Recommended Reading
Formentera Joins EOG in Wildcatting South Texas’ Oily Pearsall Pay
2025-01-15 - Known in the past as a “heartbreak shale,” Formentera Partners is counting on bigger completions and longer laterals to crack the Pearsall code, Managing Partner Bryan Sheffield said. EOG Resources is also exploring the shale.
Spartan Delta Ups Bought Deal Financing to $59MM
2025-01-14 - Underwriters have agreed to purchase approximately 22.2 million of Spartan Delta Corp. common shares, for resale to the public, at CA$3.82 per share (US$2.66), the company said.
Riverstone’s Leuschen Plans to IPO Methane-Mitigation-Focused SPAC
2025-01-14 - The SPAC will be Riverstone Holdings co-founder David Leuschen’s eighth, following the Permian Basin’s Centennial Resources, the Anadarko’s Alta Mesa Holdings and the Montney’s Hammerhead Resources.
Gigablue Enters CCS Agreement with Investment Firm SkiesFifty
2025-01-14 - Carbon removal company and investment firm SkiesFifty have partnered to sequester 200,000 tons of CO2 over the next four years.
Colonial Shuts Pipeline Due to Potential Gasoline Leak
2025-01-14 - Colonial Pipeline, the largest refined products pipeline operator in the United States, said on Jan. 14 it was responding to a report of a potential gasoline leak in Paulding County, Georgia and that one of its mainlines was temporarily shut down.