OCCIDENTAL PETROLEUM CORPORATION Stephen I. Chazen President & CEO Bernstein Strategic Decisions Conference 2015 May 28, 2015
Key Messages & Strategy Overriding Goal is to Maximize Total Shareholder Return We believe this can be achieved through a combination of: Oil and gas production growth of 5% to 8% per year over the long-term; Executing on our capital…
Why own Oxy Large Integrated Majors Independent E&Ps Company Market Cap (B) Company Market Cap (B) XOM 361 COP 80 CVX 197 Oxy EOG 49 RDS 195 Uniquely APC 44 BP 131 Positioned APA 23 TOT 125 PXD 23 ENI 66 MRO 19 Characteristics…
Medium-Term Objectives CASH FLOW GROWTH Permian Resources production growth Al Hosn project start-up Gradual Commodity price recovery Cash Flow Neutral after capital spending and COST SAVINGS dividend outlays by 4Q 2015 at…
Succession Plan Announced Oxys board of directors has approved a CEO succession plan and promoted Vicki A. Hollub to Senior Executive Vice President of Occidental and President Oxy Oil and Gas, responsible for operations in the United…
Cash Flow Priorities 1. Base/Maintenance Capital 2. Dividends 3. Growth Capital 4. Share Repurchase 5. Acquisitions 6
History Of Returning Cash To Shareholders ( in Billions) Share Period ending 2014 Cash Dividends Repurchases Combined 3 years 5.9 4.0 9.9 5 years 8.5 4.4 12.9 10 years 12.4 8.5 20.9 1Q 2015 0.5 0.2 0.7 Additionally, over the…
Confidence In Cash Flow = Dividend Increase Raised the dividend by 4+%, the 13th year of consecutive increases. Expect to be able to continue to grow our dividend for many years into the future. The new ethylene cracker which comes…
Active Share Repurchase Program Over the last 5 quarters we have repurchased 28.4 million shares of our stock and have 69 million shares remaining under our current program authorization. We will continue to repurchase shares subject…
Oxy Runs A Focused Business Oil and Gas Focus Areas United States Leading position OxyChem in the Permian Basin. High FCF, moderate Permian Resources growth business. is a growth driver. Oxy Midstream Al Hosn Project, Integrated…
Oxy is Primarily an Oil Producer Oil & Gas Production First Quarter 2015 (Million barrels of oil equivalent) By Geography By Commodity 5.6 10% 29.3 14.1 38.3 28.7 50% 24% 66% 50% U.S. International Oil NGLs Gas 12
Delivering on Production Growth U.S. oil production grew 14% in 1Q15 on a year-over-year basis.* Increased Permian Resources production guidance to 105 - 108 MBOED. Al Hosn expected to average 25 MBOED in 2Q15 and 35 MBOED for FY…
2015E Capital Budget Down Sharply vs. 2014 33% decline in 2015 capital budget Domestic O&G Domestic O&G Chemicals 42% Chemicals 43% U.S. 6% 10% Midstream Permian 9% Resources U.S. Permian Exploration 22% Midstream Resources 6%…
Capital Efficiency Continues to Improve Organic F&D Costs* Through the success of our drilling ( / BOE) U.S. Total program and capital efficiency initiatives, we lowered our F&D costs over recent 21.90 20.48 20.24 years. 18.66 16.89…
Capital Spending Ramps Down Through Year Total company capital expenditures for 2015 Capital Budget the 1Q15 were 1.7 bn and we expect our quarterly expenditures to continue to ramp 1.7 bn down through the year. Based on our lower…
Capital Program 2015 Evolution 2015 Capital Budget and Domestic Drilling Rigs As we capture price savings from suppliers and improve efficiencies, 100% Capital we are able to do more with less Budget spending. Domestic Given our large…
Permian Basin Is The Core Domestic Asset Largest oil producer and operator in Permian Basin. Significant investments in infrastructure to support the upstream provide low operating costs, advantaged realized prices and competitive…
Oxy is the Largest Permian Basin Producer Cumulative Total Operated Production, Thousand BOEPD % of total 2.3 million BOEPD Source: IHS Energy Feb and Mar 2014, 6 MCF/BOE excluding estimated CO2 production. 19
Permian Resources Drilling Inventory Lowering economic hurdle point by improving well productivity, time to market and costs 100% Drilling Inventory (44 yrs) 1. Investing in characterization Based on Q4 Costs and optimization to…
Permian Resources Summary Increased 2015 production guidance from 100 MBOED to 105 - 108 MBOED Production (MBOED) Average Rig Count Horizontal Vertical 4 5 4 7 25 21 17 19 13 2Q14 3Q14 4Q14 1Q15 Remainder 2015 Wells Drilled / Online…
Permian Resources Summary Achieved 17% increase in BOED and 22% increase in BOPD vs. Q414 1Q 2015 WELL ACTIVITY 126 Wells Online Total Production 1Q 2015 (BOED) 98,000 120 Oil Production (BOPD) 62,000 vs. 4Q-2014 22% Increase 100 vs.…
Step Change in Efficiency Our Total Time To Market Is Down 50% Faster drilling Less idle time More frac stages per day Integrated planning ( of Days) Infrastructure investments in water handling, storage, gathering and…
Domestic Drilling Rig Evolution For 2015 Some of the captured cost savings have been re-deployed into higher activity levels than planned for the remainder of 2015. 2015E Domestic Drilling Rigs 35 31 31 30 25 20 15 14 13…
Move to Manufacturing Mode Has Significantly Reduced Well Costs Manufacturing Mode Drilling / Completions WELL COST DRILL DAYS Delaware WC-A 4,500 HZ Delaware WC-A 4,500 12.0 10.9 50 45 43 10.0 8.3 40 GROSS WELL COST MM…
Move to Manufacturing Mode Has Significantly Reduced Well Costs Manufacturing Mode Drilling / Completions WELL COST WELL COST SCR Spraberry 10,000 HZ New Mexico Bone Spring HZ 10.0 9.7 8.0 7.9 7.0 6.6 8.0 7.2 GROSS WELL COST…
Permian Delaware Basin Opportunities Delaware Basin OXY Acreage Benches Majority of Wolfcamp locations are Bell Canyon Cherry Canyon in our operated areas of Reeves Brushy Canyon County. Avalon 1st Bone Spring 2nd Bone…
Permian Midland Basin Opportunities OXY Acreage Midland Basin Benches Yates Grayburg Majority of Wolfcamp locations San Andres are in our operated areas of Clear Fork Upper Spraberry Martin, Midland and Andrews Middle Spraberry…
Permian Resources Production Guidance Continue to execute focused development strategy PRODUCTION (MBOED) For the remainder of 2015: Operate average of 13 rigs (higher than planned) Expect to drill 150 wells Continue to pursue…
Permian EOR Consistent Generator of Cash 150,000 BOEPD of low cost CO2 Supply and Processing production. Most active and largest EOR operator in the Permian Basin with 30 active floods. Over 40 years of successful CO2 flooding…
Permian EOR Has A Low Cost Structure Permian EOR can operate at cash costs as low as 22 per BOE 2015 Permian EOR Cost Structure 2015 Permian EOR Cost Structure 55 WTI, 3.00 NYMEX 35 WTI, 2.00 NYMEX 35 35 30 30 2.7 25 4.0 25…
Oxy Permian Gathering / Takeaway Cushing Centurion Central/ SENM/ Midland Basins DE Basins Basin Slaughter Colorado City Seaway WTG Midland- BridgeTex South LongHorn Houston Cactus 2Q15 Owned 3rd Party Corpus…
Long-term Growth Investments Some of the longer lead time investments we have been making over the past couple of years will start contributing to our results this year. Continued preferential access and commitment to the BridgeTex…
Al Hosn Gas Project Continues To Ramp Up We completed the Al Hosn gas project, on budget and on time. It is currently producing 25,000 BOED (net to Oxy) and will ramp up through the year. FY 2015 volumes from Al Hosn should average…
Future Growth Chemicals OxyChem Ingleside Ethylene Cracker We have formed a 50/50 JV with Mexichem to build a world scale ethylene cracker at the OxyChem plant in Ingleside, TX. Construction on the Ingleside cracker project began…
Future Growth Ingleside Energy Center OxyChem Plant Terminaling - LPG: 60-100 MB/d (2Q 2015) - Crude/Condensate: 200-300 MB/d (1H 2016) - Storage: 2 - 4 MM BBLS Future processing options Provides flexibility and avoids…
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