Occidental Petroleum says CrownRock deal could close by August – 05/09/2024 at 00:17

Occidental Petroleum says CrownRock deal could close by August – 05/09/2024 at 00:17
Occidental Petroleum says CrownRock deal could close by August – 05/09/2024 at 00:17

((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))

(Added details on second quarter results communication and closing share price, paragraphs 1 and 6) by Sabrina Valle

Occidental Petroleum OXY.N hopes to complete its acquisition of shale oil producer CrownRock before releasing its second-quarter results, Chief Executive Officer Vicki Hollub said on Wednesday. This event usually takes place at the beginning of August.

In December, Occidental offered to buy Permian oil producer CrownRock in a $12 billion cash-and-stock deal, including debt. It wants to expand its presence in the largest oil field in the United States, part of a broader wave of consolidation among shale producers.

“By then, I think we will have closed the deal,” Mr. Hollub told analysts, in response to a question about when the company plans to include CrownRock in its oil production forecast.

The company is responding to a second request for information about the acquisition from U.S. regulators () and does not anticipate any obstacles, Mr. Hollub said.

Excluding the acquisition, Occidental said it plans to increase oil production in the Permian Basin from current operations of 18,000 barrels per day in the second half of 2024, with efficiency gains allowing it to to reduce the number of drilling rigs, said Richard Jackson, director of onshore operations.

Its first-quarter profit topped analysts’ consensus estimates thanks to higher-than-expected oil production. But shares fell more than 2% to close at $63.68 on Wednesday.

Occidental reaffirmed its intention to sell $4.5 billion to $6 billion in assets within 18 months of closing the CrownRock purchase. Proceeds from this sale will reduce the company’s principal debt to $15 billion or less. Occidental plans to resume its share buybacks once its debt target is reached.

“There has been a lot of interest in our portfolio assets and our teams have begun the first stages of the divestment process,” Mr. Hollub said.

Occidental hopes that “this high level of interest will translate into appropriate offers” for the assets, Mr. Hollub added.

“It all comes down to evaluation, and that’s what will make the difference for us, because we have options,” she said.



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