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4Q 2022 Earnings Presentation – Occidental Petroleum Corp

Occidental Petroleum Corp · Feb 28, 2023 · 53 slides

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Slides

  1. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 1
    02.28.23 Fourth Quarter Earnings Conference Call
  2. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 2
    3 OUTLINE 2022 and Fourth Quarter Highlights Shareholder Return Framework 2023 Capital Plan Financials Closing Remarks
  3. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 3
    HIGHLIGHTS 4 2022 ACHIEVEMENTS Record free cash flow before working capital of 13.6 B Record net income of 12.5 B1 and ROCE of 28%2 Financial Retired 10.5 B of debt and eliminated 400 MM per annum of interest and finance expenses…
  4. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 4
    HIGHLIGHTS 5 FOURTH QUARTER 2022 PERFORMANCE 2.6 B 1.6 B1 3.0 B2 Free Cash Flow Balance Sheet Share Repurchase Generation Improvement Program Completed OIL & GAS OXYCHEM LCV Production of Pre-Tax Income Advanced NET Power…
  5. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 5
    HIGHLIGHTS 6 OIL & GAS UPDATE Oxy record productivity for Delaware Basin; average 30-day IP 3,000 boed for the 191 wells online in 2022 Top two 1st Bone Spring formation IP30s in New Mexico for all operators Top six Barnett…
  6. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 6
    2022 PERMIAN EXECUTION 2022 SUCCESS 7 GENERATES 600 Permian Production Growth 565 MOMENTUM FOR 2023 523 493 90 Mboed production growth from 1Q22 to 472 4Q22 in Permian enabled Oxys 2022 sustained Net Mboed 400…
  7. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 7
    8 OUTLINE 2022 and Fourth Quarter Highlights Shareholder Return Framework 2023 Capital Plan Financials Closing Remarks
  8. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 8
    ONGOING FOCUS 2023 9 Maintain Production Base CASH FLOW Preserve asset base integrity PRIORITIES and longevity Sustainable & Growing Dividend Preserve premier Through-the-cycle sustainability with long-term growth potential asset…
  9. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 9
    SHAREHOLDER RETURN FRAMEWORK 10 Sustainable & Quarterly dividend increased 38% to 0.18 per share Growing Dividend Dividend sustainable at 40 WTI 3 B of share repurchases completed in 2022 Share v Refreshed 3 B share…
  10. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 10
    11 OUTLINE 2022 and Fourth Quarter Highlights Shareholder Return Framework 2023 Capital Plan Financials Closing Remarks
  11. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 11
    2023 CAPITAL PLAN 12 CORE CASH-GENERATIVE BUSINESSES 6.0 5.6 B 5.2 B 5.0 4.4 B1 4.0 3.0 2.0 1.0 Mid-cycle Investments Short-cycle Investments +500MM +100MM - 2022 GoM & EOR OxyChem DJ Drilling Delaware JV Inflation…
  12. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 12
    2023 CAPITAL PLAN 13 EMERGING LOW-CARBON BUSINESSES & NET-ZERO PATHWAY Expected capital range of 200 MM to 600 MM Capital range relates to optionality of third-party funding for DAC 1 and timing of projects Construction of DAC 1…
  13. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 13
    14 OUTLINE 2022 and Fourth Quarter Highlights Shareholder Return Framework 2023 Capital Plan Financials Closing Remarks
  14. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 14
    FINANCIALS 15 PREFERRED EQUITY REDEMPTION 3Q22 2.18 Illustrative Partial Preferred Equity Redemption 4Q22 2Q22 example assumes 4 per share trigger met 0.81 0.66 3.781 1Q22 Theoretical 100 MM distribution to common shareholders…
  15. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 15
    FINANCIALS 16 FOURTH QUARTER 2022 RESULTS Reported Production versus Mboed Reported Guidance Midpoint Reconciliation GULF OF MEXICO Adjusted diluted EPS1 1.61 Better performance and reduced weather +2 impact Reported diluted…
  16. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 16
    FINANCIALS 17 FIRST QUARTER AND FULL-YEAR 2023 GUIDANCE OIL & GAS OXYCHEM CORPORATE FY 2023 1Q23 Production 1Q23 pre-tax income: 475 MM Domestic tax rate: 22% Total Company: 1,160 - 1,200 Mboed FY 2023 pre-tax income: 1.3 - 1.6 B…
  17. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 17
    18 OUTLINE 2022 and Fourth Quarter Highlights Shareholder Return Framework 2023 Capital Plan Financials Closing Remarks
  18. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 18
    19 ZERO IN ON VALUE COMPLEMENTARY SHAREHOLDER STRENGTHENING PATHWAY TO BUSINESSES RETURNS FINANCIAL PROFILE NET ZERO Oil & Gas Sustainable Common Dividend Partial Preferred Equity Direct Air Capture OxyChem Share Repurchase…
  19. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 19
    20 Appendix
  20. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 20
    21 APPENDIX Financial Information Oil & Gas Update Asset Overview LCV Overview ESG Update
  21. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 21
    FINANCIAL INFORMATION 22 CASH FLOW SENSITIVITIES OIL & GAS MIDSTREAM & MARKETING Annualized cash flow changes 225 MM per 1.00 / Annualized cash flow changes 65 MM per 0.25 / bbl bbl change in oil prices change in Midland to MEH…
  22. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 22
    FINANCIAL INFORMATION Capital B 2022 Actuals 2023 Plan 23 2023 CAPITAL PLAN Oil & Gas 3.8 4.3 - 4.7 Chemicals 0.3 0.6 Sustaining Capital1 Midstream & Corporate 0.3 0.3 300 MM change from 2022: Subtotal 4.4 5.2 - 5.6 Sustaining…
  23. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 23
    FINANCIAL INFORMATION RECONCILIATION FROM 2022 VOLUMES 24 2023 PRODUCTION UPDATE 21 Mboed annual increase (2%) in total production driven primarily by 2022 trajectory 1,250 +62 3% annual production growth, excluding Algeria contract…
  24. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 24
    FINANCIAL INFORMATION 25 BALANCE SHEET IMPROVEMENT DRIVES SHAREHOLDER VALUE PRIORITIZING BALANCE 100 Enterprise Value ( B) SHEET IMPROVEMENT 90 Market capitalization becomes 80 a larger percentage of 38% 38% 39% 38% 70 enterprise…
  25. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 25
    FINANCIAL INFORMATION 26 DILUTED SHARE COUNT EXAMPLE Basic Shares Outstanding + Incremental Diluted Shares = Total Diluted Outstanding Shares Incremental diluted shares include June 2020 warrants, Berkshire Hathaway warrants, and…
  26. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 26
    27 APPENDIX Financial Information Oil & Gas Update Asset Overview LCV Overview ESG Update
  27. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 27
    OIL & GAS UPDATE 28 DOMESTIC ONSHORE ASSETS PERMIAN 2023 ACTIVITY ROCKIES 2023 ACTIVITY 2.3 B - 2.6 B 23 Gross 10 Net 380 - 410 0.7 - 0.8 B 3 Gross 2 Net 90 - 105 Capex Rigs Rigs Wells Online Capex Rigs Rigs Wells Online 100% OBO…
  28. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 28
    TOP TIER WELL PERFORMANCE CONTINUES DELAWARE TO IMPROVE 29 BASIN WELL 450 PRODUCTIVITY 400 Superior-quality 350 inventory combined with subsurface expertise Cumulative Mboe 300 drives continuous improvement and value 250 200…
  29. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 29
    OIL & GAS UPDATE 30 LEADING DELAWARE BASIN WELL PERFORMANCE AVERAGE 6-MONTH CUMULATIVE OIL BY OPERATOR1 AVERAGE 12-MONTH CUMULATIVE OIL BY OPERATOR2 Oxy is 31% above the 6-month basin average Oxy is 21% above the 12-month basin…
  30. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 30
    DOMESTIC Domestic Onshore Operated Inventory Total Gross Operated Locations 8,000 31 INVENTORY & 6,885 INNOVATION 6,000 5,592 4,000 3,812 Depth of low-breakeven inventory demonstrates quality 2,000 1,321 and quantity of…
  31. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 31
    OIL & GAS UPDATE 32 2022 RESERVES 300 MMboe Total Reserves Improvement Through Program Execution 600 MMboe Organic Reserves Added Excluding Price Revisions 142% Program Additions Reserves Replacement Ratio 176 3,817 3,512 563 (11)…
  32. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 32
    Al Hosn Gas Project Execution and Operational Excellence 33 World-class, state-of-the-art sour-gas project Plant capacity increased twice between 2016 and 2018 with minimal capital investment 2021: Expansion project commenced;…
  33. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 33
    34 APPENDIX Financial Information Oil & Gas Update Asset Overview LCV Overview ESG Update
  34. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 34
    OXYS COMBINED INTEGRATED PORTFOLIO 35 Oil & Gas OxyChem Oxy Midstream Focused in world class Leading manufacturer of basic Integrated infrastructure and basins with a history of chemicals and significant cash marketing provide…
  35. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 35
    OXYCHEM 2,500 Pre-Tax Earnings (EBIT)1 36 MARKET LEADING POSITION 2,000 23 owned facilities worldwide 1,500 MM Integrated assets capture benefits of favorable market conditions 1,000 Top tier global producer in every product…
  36. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 36
    OXYCHEM PROJECTS UPDATE 37 BATTLEGROUND MODERNIZATION & EXPANSION PROJECT Modernization and expansion of the Battleground plant expected to increase cash flow through improved margins and higher product volumes, while enhancing…
  37. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 37
    MIDSTREAM & MARKETING 38 GUIDANCE RECONCILIATION PHYSICAL MIDSTREAM BUSINESS 4Q22 income slightly below guidance primarily 4Q22 Guide 4Q22 Actuals 1Q23 Guide driven by higher maintenance activities for 200 domestic gas process…
  38. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 38
    ONE OF THE LARGEST U.S. ACREAGE HOLDERS 39 9.5 MM Net Total U.S. Acres Rockies Permian 1.1 MM Acres 2.8 MM Acres Powder River Basin 0.3 MM Permian Unconventional 1.4 MM DJ Basin 0.8 MM Excludes acreage outside of active…
  39. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 39
    U.S. ONSHORE OVERVIEW 40 Rockies Permian 1.1 MM Acres 2.8 MM Acres 4Q22 Net Production Oil NGLs Gas Total (Mbod) (Mbbld) (MMcfd) (Mboed) Permian 337 130 590 565 Rockies & Other Dmstc. 79 97 575 272 Total 416 227 1,165…
  40. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 40
    GULF OF MEXICO OVERVIEW 41 Gulf of Mexico 1.0 MM Acres MARLIN 4Q22 Net Production HORN MOUNTAIN Oil (Mbod) 126 NANSEN HOLSTEIN NGLs (Mbbld) 11 CONSTITUTION BOOMVANG MARCO POLO CAESAR/TONGA Gas (MMcfd) 79 GUNNISON…
  41. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 41
    INTERNATIONAL OVERVIEW 42 U.A.E. 2.5 MM Acres 4Q22 Net Production Oil NGLs Gas Total (Mbod) (Mbbld) (MMcfd) (Mboed) Algeria & Other Intl. 41 5 14 48 Al Hosn 14 27 268 86 Dolphin 6 8 148 39 Oman 56 - 68 67 Total 117 40 498 240…
  42. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 42
    43 APPENDIX Financial Information Oil & Gas Update Asset Overview LCV Overview ESG Update
  43. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 43
    CCUS TECHNOLOGY AND MARKET ADVANCEMENT 44 ROADMAP TO COMMERCIAL DEVELOPMENTS VOLUNTARY & COMPLIANCE POLICY 2021 2024 2025 2030 DE-RISK & INNOVATE MANUFACTURING MODE CURRENT DIRECT AIR MAR 2022 CAPTURE & REVENUE SEQUESTRATION…
  44. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 44
    A HISTORIC AND MOMENTOUS CARBON CAPTURE PROJECT 45 UP TO 30 DAC MEGA-HUB DEVELOPMENT SECURED Finalized agreement with King Ranch to secure acreage that enables potential 30 MTPA DAC mega-hub 106,000 acres / 166 sq. miles…
  45. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 45
    DIRECT AIR CAPTURE 46 PROGRESS TOWARD DAC 1 LICENSE TO BUILD Exclusive DAC and AIR TO FUELS license for U.S. deployment. OLCV has a worldwide agreement as the execution partner for all DAC and AIR TO FUELS deployments INNOVATION…
  46. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 46
    OXY TO UTILIZE CLEAN ENERGY GENERATED BY NET POWERS FIRST UTILITY SCALE PLANT 47 Oxy expected to be the primary offtaker of clean energy generated by NET Power using a transformational technology that inherently captures nearly…
  47. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 47
    48 APPENDIX Financial Information Oil & Gas Update Asset Overview LCV Overview ESG Update
  48. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 48
    49 OXYS NET-ZERO STRATEGY AND GOALS In 2020, Oxy adopted the following goals to achieve Net Zero across our total emissions inventory in accordance with the goals of the Paris Agreement: Net-zero emissions in our operations and…
  49. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 49
    PATHWAY TO NET ZERO 50 50 Oxy has set the following goals, among others, to achieve net zero across our total emissions inventory in accordance with the goals of the Paris Agreement1: 2024 2032 2040 2050 BEYOND Reduce total…
  50. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 50
    51 RECENT ADVANCEMENTS IN OXYS NET-ZERO STRATEGY Methane (CH4) Emissions Estimated methane emissions decreased by 33% from 2020 to 2021 Completed Front-End Engineering and Design (FEED) and began site construction activities for…
  51. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 51
    52 ZERO ROUTINE FLARING U.S. OPERATIONS Achieved Zero Routine Flaring during 2022 across U.S. Oil & Gas operations, 8 years ahead of the World Banks 2030 target Received agency approval of closed-loop gas capture to mitigate…
  52. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 52
    BOARD OF DIRECTORS & CORPORATE GOVERNANCE 53 A DIVERSE GROUP OF SKILLED, EFFECTIVE DIRECTORS Name and Principal Occupation Director Since Independent Jack B. Moore (Independent Chairman) Former President and Chief Executive Officer,…
  53. 4Q 2022 Earnings Presentation – Occidental Petroleum Corp – slide 53

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