Houston Chronicle by Paul Takahashi Aug. 11, 2020
Occidental Petroleum is not planning to increase oil production next year but will instead focus on paying down its massive debt and strengthening its finances in the aftermath of the coronavirus-driven oil bust.
The Houston independent also is looking to partner with other oil and gas companies to develop new drilling projects. The joint ventures would help Oxy save costs by pooling resources.
“I don’t see us growing next year,†CEO Vicki Hollub said in a conference call with analysts Tuesday. “We will spend $2.7 billion to $2.9 billion in maintenance capital to keep production flat next year and use all available cash to retire our debt. That’s our highest priority for next year.â€
The pronouncement came as the Houston independent posted a steep second-quarter loss of $8.4 billion compared with a profit of $635 million during the same period a year ago. Second quarter revenue fell by one-third to about $3 billion, down from about $4.5 billion during the same period a year ago.
Oxy, saddled with debt from its $38 billion acquisition of Anadarko Petroleum last year, wrote down the value of its oil and gas assets by $6.6 billion to reflect low crude prices. The average price of Oxy’s oil fell about 61 percent to $23.17 per barrel in the second quarter, down from $58.91 per barrel the same period last year.
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