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Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp

Occidental Petroleum Corp · Aug 3, 2016 · 44 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. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 1
    OCCIDENTAL PETROLEUM CORPORATION Second Quarter 2016 Earnings Conference Call August 3, 2016
  2. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 2
    Second Quarter 2016 Key Messages Operational excellence On track to achieve high end of 4% - 6% production growth guidance for total FY 2016 production of 590 600 MBOED Optimal capital allocation On track for original 3 billion…
  3. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 3
    Second Quarter 2016 Core Production Growth & Reduced Production Costs Total Company Production* Production Costs* (MBOED) (/boe) 609 12.98 552 10.57 2Q 2015 2Q 2016 2Q 2015 2Q 2016 * Ongoing operations; excludes…
  4. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 4
    Second Quarter 2016 Earnings Al Hosn Update Previous capacity guidance of 60 MBOED net Al Hosn Gas team carrying out detailed plant capacity reviews and optimizations to increase deliverability through the plant Plant operated at…
  5. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 5
    Second Quarter 2016 Earnings Oman Update Block 62 Oman Block 62 Two new gas fields online (Fushaigah and Maradi Huraymah) Maradi Huraymah Gas Plant constructed in 12 months (On time and on budget) Current production from Block 62…
  6. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 6
    Second Quarter 2016 Earnings Qatar Update Best production in 16 years in Block 12 ISSD Al Rayyan Dolphin Well design changes enhanced production from Shuaiba D well Al Hawailah to set up enhanced development 48 Export Pipeline…
  7. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 7
    Second Quarter 2016 Earnings Colombia Update Steam Flood Pilot Llanos Norte (LLN) Occidental discovered the giant Cao Limn Field in 1983 (Cumulative production = 1.3 billion barrels of oil) Oxy LLN Currently also conducting…
  8. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 8
    Second Quarter 2016 2016 Production Outlook The increases in production from Al Hosn and Block 62, along with strong year over year production growth from Permian Resources will help us reach the higher end of our production guidance…
  9. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 9
    Second Quarter 2016 Earnings Capital Program On track to meet 3 billion capital 2016 Capital Budget budget ( in millions) Continued improvements in project designs and capital execution have helped us do more than expected 687 657…
  10. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 10
    Second Quarter 2016 Earnings Capital Program In Permian Resources, cost savings 2016 Capital Budget due to improved efficiencies will be ( in millions) re-deployed into drilling incremental wells in 2H16 which will impact 2017…
  11. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 11
    Second Quarter 2016 Earnings Ethylene Cracker on Schedule Ingleside Ethylene LLC Ingleside Ethylene Cracker July 2016 50% / 50% Joint Venture with MexiChem 1.2 billion lbs / year cracker, associated pipeline and storage Long term…
  12. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 12
    Second Quarter 2016 Earnings Ingleside Oil Terminal Terminal will have total oil storage capacity of 2 million barrels and throughput capacity of 300 thousand barrels per day Project is on budget and on schedule Ingleside Export…
  13. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 13
    Second Quarter 2016 Total Spend per BOE Continued Decline Capital Spending + G&A + All Operating Costs Total Spend per BOE = Global Oil & Gas Sales Volumes Internal performance metric to focus on 62.00 operational efficiency,…
  14. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 14
    Second Quarter 2016 Earnings Strong Balance Sheet Illustrative Sources & Uses of Cash Ended 2Q16 with 3.8 billion of cash on hand, an increase of nearly 600 million from 1Q16 1H16 Annualized Cash Flow* 3.5 bn Cash flows from…
  15. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 15
    Second Quarter 2016 Earnings Strategy for Profitable Growth in 2017 Throughout this year we have consistently said that we will prudently manage our activity levels to stay positioned for profitable growth in 2017 while maintaining…
  16. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 16
    Second Quarter 2016 Earnings Strategy for Profitable Growth in 2017 We are also continuing to look for ways to expand our positions in the Permian through asset acquisitions. Objective is to pursue opportunities in both enhanced oil…
  17. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 17
    Second Quarter 2016 Dividend Increase At our board meeting in July, we announced an increase in our annual dividend rate from 3.00 to 3.04 per share. Oxy has now increased its dividend every year for 14 consecutive years, and a total…
  18. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 18
    Second Quarter 2016 Earnings Cash Flow Priorities 1. Base/Maintenance Capital 2. Dividends 3. Growth Capital 4. Share Repurchase 5. Acquisitions 19
  19. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 19
    Second Quarter 2016 Board of Directors Election Jack B. Moore, former Chairman of Cameron International Corporation, has been elected to Oxys Board of Directors. Mr. Moore, 62, served as Chairman of the Board for Cameron…
  20. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 20
    Second Quarter 2016 Core Results Results Total ongoing oil production (Bbl/d)* 386,000 flat YoY* Total ongoing production (BOED) 609,000 Core results** (136) million Core diluted EPS** (0.18) 2Q16 CFFO before Working Capital…
  21. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 21
    Second Quarter 2016 Oil and Gas Total Company Production Ongoing Operations In 2Q 2016, total company oil and gas production volumes averaged 609,000 BOED, an increase of 19,000 BOE in daily production from 1Q 2016. Company-wide Oil &…
  22. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 22
    Second Quarter 2016 Oil and Gas Domestic Production Domestic Oil & Gas Production* (MBOED) 307 (7) 2 302 - 298 2Q15 1Q16 Oil NGLs Natural Gas 2Q16 *Core production excludes Williston and Piceance production volumes 23
  23. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 23
    Second Quarter 2016 Oil and Gas International Production International production was up 24,000 BOED in 2Q 2016 with Al Hosn running at full capacity and Block 62 in Oman increasing. International Oil & Gas Production* (MBOED) 20…
  24. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 24
    Second Quarter 2016 Oil & Gas Realized Prices Realized Prices Benchmark Prices Worldwide Worldwide Domestic Nat. Oil (/bbl) NGLs (/bbl) Gas (/mmbtu) WTI Brent NYMEX 2Q16 39.66 14.59 1.46 45.59 46.97 1.97 WTI % 87% 32% 74%* Brent %…
  25. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 25
    Second Quarter 2016 YTD 2016 Cash Flow 1H 2016 ( in millions) 1,750 (810) 2Q16 (1,350) Debt / Capital 27% (1,150) 900 10 4,400 3,750 Beginning Cash CFFO Before Change in Capital Dividends Debt Asset Sale Ending Cash…
  26. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 26
    Second Quarter 2016 Debt Maturity Schedule New issuances extended the dollar-weighted average maturity of debt by over 5 years. Rating Outlook S&P A Stable Fitch A Stable million Retired / Called maturities Moodys A3 Stable…
  27. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 27
    Second Quarter 2016 FY and 3Q 2016 Production Outlook FY 2016 Total Production Outlook Core Assets (Excludes Iraq, Bahrain & Piceance) Total volumes of 590,000 600,000 BOED 3Q16 Total Production Outlook Core Assets (In 3Q16,…
  28. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 28
    Second Quarter 2016 3Q16 & FY 2016 Guidance Summary Oil & Gas Segment DD&A FY 2016E FY 2016E Total Production Core Assets Oil & Gas: 15.00 / BOE 590,000 600,000 BOED Chemicals and Midstream: 655 mm 3Q16E Production Core Assets…
  29. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 29
    Second Quarter 2016 Earnings Permian Resources Production Total production grew 16% year-over- Oil NGL Gas year to 126 MBOED MBOED Oil production grew 10% year-over- year to 79 MBOD 128 126 116 121 2Q 2016 activity was down…
  30. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 30
    Second Quarter Earnings 2016 Permian Resources Manufacturing Mode: Drilling / Completions Move to Manufacturing Mode Significantly Reduced Well Cost Permian Resources Permian Resources Cost (MM) / 1,000' of Perforated Lateral 1,000'…
  31. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 31
    Second Quarter Earnings 2016 TX Delaware Basin Recent Performance Well Performance: Texas Delaware Wolfcamp A Buzzard State 21 11H three month cumulative production of 110 MBOE 75% oil HB Morrison B 12H three month cumulative…
  32. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 32
    Second Quarter Earnings 2016 TX Delaware Basin Manufacturing Mode: Drilling / Completions Move to Manufacturing Mode Significantly Reduced Well Cost WELL COST DRILL DAYS Delaware Wolfcamp A 4,500 HZ Delaware Wolfcamp A 4,500 HZ…
  33. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 33
    Second Quarter Earnings 2016 Southeast New Mexico Recent Performance Optimization efforts have significantly increased value Increased proppant to 1,500 lbs/ft creating increased reservoir stimulation and complexity New Design 4 Wells…
  34. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 34
    Second Quarter Earnings 2016 East Midland Basin Recent Performance Cost Efficiency Efforts: Wolfcamp A Optimize completion designs with geology throughout the field Decreased cluster spacing and increased proppant per lateral foot…
  35. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 35
    Second Quarter Earnings 2016 West Midland Performance Completion optimization efforts have significantly increased value 56% improvement in cumulative BOE production South Curtis Ranch Lower Spraberry 10,000' 180 Best performer SCR…
  36. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 36
    Second Quarter Earnings 2016 East Midland Basin Manufacturing Mode: Drilling / Completions Move to Manufacturing Mode Significantly Reduced Well Cost WELL COST DRILL DAYS East Midland East Midland Wolfcamp A 7,500' Hz Wolfcamp A…
  37. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 37
    Second Quarter Earnings 2016 Permian Resources Continued Opex Reduction Permian Resources Opex / BOE Continued focus on reducing field 15.00 operating costs during 2016 Surface expense /boe reduced 43% 11.41 from Q2 2015 10.87…
  38. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 38
    Second Quarter Earnings 2016 Permian Resources Production Optimization Permian Resources Production Focused on maximizing 6 Optimization (MBOEPD) production from existing wells 5.4 4.7 High return, quick payback 5 projects with…
  39. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 39
    Second Quarter 2016 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 expected to generate free cash…
  40. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 40
    Second Quarter 2016 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…
  41. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 41
    Second Quarter 2016 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 (ahead…
  42. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 42
    Second Quarter 2016 Residual Oil Zone Development The ROZ development is a vertical expansion of the CO2 flooded interval. The ROZ underlies most of our major EOR properties with current projects in South Hobbs and West Seminole and…
  43. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 43
    Second Quarter 2016 Permian Appraisal Activity Drilled a 2nd Bone Spring appraisal well in the Texas Delaware region with encouraging results, which we believe will add additional bench potential to the long term development plan in…
  44. Q2 2016 Earnings Conference Calls – Occidental Petroleum Corp – slide 44
    Second Quarter 2016 Permian Summary Expect to increase to 7 8 rigs in Oil NGL Gas 2H16 MBOED Successfully enhancing completion 273 270 260 265 methods across Permian Resources 255 acreage position 222 Achieving better than…

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