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Q4 2015 Results – Occidental Petroleum Corp

Occidental Petroleum Corp · Feb 4, 2016 · 41 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q4 2015 Results – Occidental Petroleum Corp – slide 1
    OCCIDENTAL PETROLEUM CORPORATION Fourth Quarter 2015 Earnings Conference Call February 4, 2016
  2. Q4 2015 Results – Occidental Petroleum Corp – slide 2
    Fourth Quarter 2015 Execution Of Our Growth Strategy Permian Resources growth exceeded our expectations as we reached our 2016 growth target of 120,000 BOED a year early. We increased production by 35,000 BOED, a 47% year over year…
  3. Q4 2015 Results – Occidental Petroleum Corp – slide 3
    Fourth Quarter 2015 Production Growth Total Oil Production* Total Company Production* (MBOD) (MBOED) 416 652 362 571 2014 2015 2014 2015 * Ongoing operations; excludes Williston & Hugoton production volumes 4
  4. Q4 2015 Results – Occidental Petroleum Corp – slide 4
    Fourth Quarter 2015 Execution Of Our Strategic Initiatives Closed the sale of Williston Basin Williston Sale properties 16 MBOED FY15 0.6 bn pre-tax Progressed our efforts to exit from non- proceeds core operations in Middle…
  5. Q4 2015 Results – Occidental Petroleum Corp – slide 5
    Fourth Quarter 2015 Strategy Overall strategy is to invest in projects that generate long-term value, achieving returns well above our cost of capital while maintaining a conservative balance sheet Our assets in Permian EOR,…
  6. Q4 2015 Results – Occidental Petroleum Corp – slide 6
    Fourth Quarter 2015 Cash Flow Priorities 1. Base/Maintenance Capital 2. Dividends 3. Growth Capital 4. Share Repurchase 5. Acquisitions 7
  7. Q4 2015 Results – Occidental Petroleum Corp – slide 7
    Fourth Quarter 2015 Improved Cost Structure Production Costs Overhead (SG&A) (/boe) ( millions) Expect continued improvement in cost 13.50 1,503 structure Strategic Initiatives 1,270 11.57 Lower workovers Lower downhole…
  8. Q4 2015 Results – Occidental Petroleum Corp – slide 8
    Fourth Quarter 2015 2016 Capital Outlook 2016 Capital Budget Carefully reduce activity levels without ( in bln) harming the strong progress on growth prospects 5.6 Fund only those opportunities that exceed hurdle rates of return…
  9. Q4 2015 Results – Occidental Petroleum Corp – slide 9
    Fourth Quarter 2015 Committed Project Capital Declining Committed Project Capital Multiple long-term investments to ( in millions) drive cash flow and earnings 1,300 growth Al Hosn Ethylene cracker JV 800 Ingleside terminal Gas…
  10. Q4 2015 Results – Occidental Petroleum Corp – slide 10
    Fourth Quarter 2015 2016 Capital Outlook Oil & Gas Capital Budget Chemicals and Midstream Capital Budget ( in bln) ( in bln) 4.4 1.2 1.0 2.0 2015 2016E 2015 2016E Maintenance Sustaining Growth Maintenance Sustaining…
  11. Q4 2015 Results – Occidental Petroleum Corp – slide 11
    Fourth Quarter 2015 2016 Production Outlook Expect total production from core assets to grow 2% - 4% over 2015 levels Core assets exclude Bahrain, Libya, Iraq, Yemen, Williston and Piceance Basins Full year contribution from Al Hosn…
  12. Q4 2015 Results – Occidental Petroleum Corp – slide 12
    Fourth Quarter 2015 Reserves Continue to build on our strategy to focus on our existing strong Permian position In total Permian business, replaced 115% of production through our drilling program In Permian Resources segment,…
  13. Q4 2015 Results – Occidental Petroleum Corp – slide 13
    Fourth Quarter 2015 Capital Program Capital Program 8.7 bn Total company capital expenditures 2015 were 5.6 billion, a 36% Permian reduction from 2014 Resources 5.6 bn Oil and Gas spent 4.4 billion, with Permian Permian…
  14. Q4 2015 Results – Occidental Petroleum Corp – slide 14
    Fourth Quarter 2015 2016 Capital Breakdown Oil & Gas 2016 Capital Budget 2.8 - 3.0 billion Domestic Overall spending levels in the Permian will decline Chemicals 18% Permian Resources 21% International Midstream Spending…
  15. Q4 2015 Results – Occidental Petroleum Corp – slide 15
    Fourth Quarter 2015 2016 Capital Breakdown Chemicals & Midstream 2016 Capital Budget Includes 500 million of committed capital 2.8 - 3.0 billion for projects to be completed by YE 2016 Chemicals Includes the Ingleside Ethylene…
  16. Q4 2015 Results – Occidental Petroleum Corp – slide 16
    Fourth Quarter 2015 Core Results Results Domestic oil production (Bbl/d) 190,000 11% year / year growth* Total company production (BOED) 671,000 Core results** (129) million Core diluted EPS** (0.17) 4Q15 CFFO before Working…
  17. Q4 2015 Results – Occidental Petroleum Corp – slide 17
    Fourth Quarter 2015 2015 Production from Core Assets Core Assets - Oil & Gas Production (MBOED) 668 36 72 560 FY2015 Reported Domestic Asset Sales Non-Core MENA 2015 Core Assets Production 18
  18. Q4 2015 Results – Occidental Petroleum Corp – slide 18
    Fourth Quarter 2015 Oil and Gas Total Company Production In 4Q15, total company oil and gas production volumes averaged 671,000 BOED, a decrease of 1,000 BOE in daily production from 3Q 2015. Company-wide Oil & Gas Production…
  19. Q4 2015 Results – Occidental Petroleum Corp – slide 19
    Fourth Quarter 2015 Oil and Gas Domestic Production Exceeded our domestic oil production growth guidance with a year over year increase of 19,000 BOD or about 11% led by our Permian Resources assets. Domestic Oil & Gas Production…
  20. Q4 2015 Results – Occidental Petroleum Corp – slide 20
    Fourth Quarter 2015 Oil & Gas Realized Prices Realized Prices Benchmark Prices Worldwide Worldwide Domestic Nat. Oil (/bbl) NGLs (/bbl) Gas (/mmbtu) WTI Brent NYMEX 4Q15 38.68 14.02 1.75 42.18 44.71 2.44 WTI % 92% 33% 72%* Brent %…
  21. Q4 2015 Results – Occidental Petroleum Corp – slide 21
    Fourth Quarter 2015 YTD 2015 Cash Flow FY 2015 ( in millions) 4,800 (2,100) 4Q15 (5,600) LT Debt / Capital 22% 7,800 (2,300) 900 4,400 1,500 (600) Beginning CFFO Before Change in Capital Dividends Share Debt Issuance…
  22. Q4 2015 Results – Occidental Petroleum Corp – slide 22
    Fourth Quarter 2015 2016E Sources & Uses of Cash 2016 Illustrative Sources & Uses of Cash S&P Rating affirmed at single A with stable outlook Ecuador Payments 1.2 bn & Asset Sales Financial flexibility to invest through the cycle…
  23. Q4 2015 Results – Occidental Petroleum Corp – slide 23
    Fourth Quarter 2015 FY 2016 Production Outlook Core Assets FY 2016 Total Production Outlook Core Assets (Excludes Iraq, Libya, Bahrain, Yemen, Williston & Piceance) Total volumes of 570,000 585,000 BOED FY 2016 US Production…
  24. Q4 2015 Results – Occidental Petroleum Corp – slide 24
    Fourth Quarter 2015 1Q16 Production Outlook 1Q16 Total Production Outlook Total production of 620,000 630,000 BOED Permian Resources of 121,000 BOED Middle East volumes impacted by 15,000 BOED due to scheduled maintenance…
  25. Q4 2015 Results – Occidental Petroleum Corp – slide 25
    Fourth Quarter 2015 Targeted SG&A Reductions The realignment of our business helped us make strong progress in lowering our SG&A costs in 2015 by more than 200 million. In the current environment, we expect to reduce these costs by…
  26. Q4 2015 Results – Occidental Petroleum Corp – slide 26
    Fourth Quarter 2015 1Q16 & FY 2016 Guidance Summary Oil & Gas Segment DD&A FY 2016E FY 2016E Total Production Core Assets Oil & Gas: 15.00 / BOE 570,000 585,000 BOED Chemicals and Midstream: 675 mm FY 2016E Domestic Production Core…
  27. Q4 2015 Results – Occidental Petroleum Corp – slide 27
    Fourth Quarter 2015 Permian Resources Production Oil NGL Gas Total production grew 40% year- over-year to 118 MBOED. Oil production grew 49% year-over-year to 76 MBOD. 116 118 123 110 109 Oil production is expected 98 to…
  28. Q4 2015 Results – Occidental Petroleum Corp – slide 28
    Fourth Quarter 2015 Delaware Basin Recent Performance Well Performance: Texas Delaware Wolfcamp A Peck State 258 6H - 12 month cumulative production: 384 Mboe 84% oil Buzzard State 9H - 12 month cumulative production: 318 Mboe 75%…
  29. Q4 2015 Results – Occidental Petroleum Corp – slide 29
    Fourth Quarter 2015 Southeast New Mexico Recent Performance Well Performance: New Mexico 2nd Bone Spring Cedar Canyon 27 State 4H - 12 month cumulative production: 252 Mboe 79% oil Misty 35 Fed Com 4H 9 month cumulative production:…
  30. Q4 2015 Results – Occidental Petroleum Corp – slide 30
    Fourth Quarter 2015 Permian Resources - Manufacturing Mode Move to Manufacturing Mode Significantly Reduced Well Cost 10.9 6.2 5.5 Rig Release to Rig Release 31
  31. Q4 2015 Results – Occidental Petroleum Corp – slide 31
    Fourth Quarter 2015 East Midland Basin Recent Performance Well Performance: East Midland - Wolfcamp A Adams 4231 1WA - 3 month cumulative production: 117 Mboe 92% oil Adams 4201WA - 6 month cumulative production: 180 Mboe 91% oil…
  32. Q4 2015 Results – Occidental Petroleum Corp – slide 32
    Fourth Quarter 2015 Permian Resources - Manufacturing Mode Move to Manufacturing Mode Significantly Reduced Well Cost 9.2 6.0 5.3 Rig Release to Rig Release 33
  33. Q4 2015 Results – Occidental Petroleum Corp – slide 33
    Fourth Quarter 2015 Permian Resources Cost Reduction Focus on reducing field operating costs during 2015 Downhole expense (/boe) reduced 34% from 4Q14 Company operated operating expense down 30% (/boe) from 4Q14 34
  34. Q4 2015 Results – Occidental Petroleum Corp – slide 34
    Fourth Quarter 2015 Permian EOR CO2 Supply & Processing Stable and low-decline base production at an advantaged cost Permian EOR business remains profitable in the current downturn EOR business is expected to generate free cash…
  35. Q4 2015 Results – Occidental Petroleum Corp – slide 35
    Fourth Quarter 2015 World Leader in Enhanced Oil Recovery U.S. CO2 EOR Projects 3,500 Size of bubble = CO2 EOR 3,000 Production Volume Number of Injection Wells Oxy 2,500 2,000 All of Oxys CO2 operations 1,500 Kinder Morgan…
  36. Q4 2015 Results – Occidental Petroleum Corp – slide 36
    Fourth Quarter 2015 Permian EOR 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 2.7 30…
  37. Q4 2015 Results – Occidental Petroleum Corp – slide 37
    Fourth Quarter 2015 Permian EOR Cash Operating Expense (/BOE) 25.00 Cash Operating Expense reduced 20.82 20.03 by 4.36 / BOE in 4Q14 to 4Q15 20.00 18.16 18.36 16.46 Savings were driven by 15.00 productivity gains and…
  38. Q4 2015 Results – Occidental Petroleum Corp – slide 38
    Fourth Quarter 2015 South Hobbs: CO2 Flood and Expansion Areas Main Oil Column CO2 Flood: Residual Oil Zone (ROZ) Potential: Started CO2 injection into Phase 1 in September, Four pattern initial development to begin in 2016. 2015…
  39. Q4 2015 Results – Occidental Petroleum Corp – slide 39
    Fourth Quarter 2015 2016 Permian Strategy Given the current oil price environment, we will focus on investment to achieve four core goals: Accelerate geoscience, characterization and modeling programs to enhance recovery,…
  40. Q4 2015 Results – Occidental Petroleum Corp – slide 40
    Fourth Quarter 2015 Permian Resources Drilling Inventory Continuing to lower economic hurdle points through reservoir characterization and optimization, improved productivity, reduced well costs, and faster time to market 100%…
  41. Q4 2015 Results – Occidental Petroleum Corp – slide 41
    Fourth Quarter 2015 Permian Summary EOR Resources 2016 activity focused on core locations with minimal infrastructure investments 260 261 266 255 254 Analyze appraisal data to support 243 future development and initiate 222 seed…

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