CATEGORIZED | News

Occidental Petroleum to separate California assets into new company

Posted on 14 February 2014

Occidental Petroleum board of directors has authorized the separation of the company’s California assets into an independent and separately traded company. The new California company will have 8,000 employees and contractors and will establish its headquarters in the state. It will be California’s largest natural gas producer and the state’s largest oil and gas producer on a gross-operated BOE basis.

This new company will be the largest oil and gas mineral acreage holder in the state with approximately 2.3 million net acres and will have major operations in the state’s high-potential oil and gas basins, including Los Angeles, San Joaquin, Ventura and Sacramento. Last year, the business earned approximately $1.5 billion on a pre-tax basis. Earnings before income, taxes, depreciation and amortization were around $2.6 billion with capital expenditures of approximately $1.7 billion. Due to these strong results, capital expenditures planned for 2014 were increased to $2.1 billion.

Occidental Petroleum will be headquartered in Houston. It will have exploration and production operations in the Permian Basin and other parts of Texas, the Middle East region and Colombia. It will also have a midstream and marketing segment and a chemical subsidiary, OxyChem.

“Creating two separate energy companies will result in more focused businesses that will be competitive industry leaders,” said Stephen I. Chazen, president and CEO of Occidental.

The board also announced that Mr Chazen will remain president and CEO to lead the successful completion of the strategic review and ensure a suitable management team is in place for Occidental. He has agreed to do so through the 2016 Annual Meeting of Stockholders. The board also has asked Ambassador Edward P. Djerejian, who was elected as chairman of the board last May, to remain as chairman for an additional one-year term.

Occidental will continue planning for the separation of the businesses, including determining management and governance of the California business. The company expects to announce the California management team in Q3 this year and complete the separation by the end of 2014 or early 2015..

 

Leave a Reply

*

FEATURED MICROSITES


Recent Drilling News

  • 19 November 2014

    Stepwise approach guides Statoil’s North American onshore path

    When Statoil entered the North American onshore industry in 2008, it was a non-operator in a joint venture (JV) with Chesapeake in one shale play. Since then, Norwegian-based…

  • 18 November 2014

    Stilley: Despite challenging outlook, opportunities are plenty in the long term

    Opportunities abound for the drilling industry even in an environment of high costs and falling oil prices, Randall D. Stilley, President & CEO of Paragon Offshore, said...

  • 18 November 2014

    In well control, an ounce of prevention is worth a pound of cure

    It has been more than four years since Macondo, and the long-term effects of the oil spill are still being determined. “Oil is a natural substance that can be degraded...

  • 18 November 2014

    Plaisance: Well Control Institute evaluating priority topics

    The Well Control Institute (WCI) Board of Directors convened on 11 November in New Orleans. Moe Plaisance, who recently retired from Diamond Offshore Drilling, has...

  • 18 November 2014

    Powell: Drilling contractors responsible for well control; planning, risk assessment fall under operators in EU directive

    Before joining IADC, Taf Powell served with the European Commission as an expert adviser in offshore drilling and...

  • Read more news