Occidental Petroleum posts larger quarterly loss on asset sale

Occidental Petroleum posts larger quarterly loss on asset sale

News: Occidental Petroleum posts larger quarterly loss on asset sale.

HOUSTON (Reuters) – Occidental Petroleum Corp posted a higher than expected fourth quarter loss on Monday, despite higher oil and gas prices, as an asset sale weighed on earnings.

The American producer cut jobs and production after the coronavirus pandemic weighed on global energy demand and put pressure on an energy company that went into debt in 2019 to win over an oil competitor. The fourth quarter loss increased to $ 731 million from $ 269 million in the year-ago quarter.

Stocks fell as much as 4% after the close of trading but later reduced losses and fell 2% to $ 25.85.

The adjusted loss per share of 78 cents was above analysts’ expectations for a loss of 59 cents, according to IBES data on Refinitiv. In the same quarter last year, the company posted a loss per share of 30 cents.

“We continue to strive to strengthen our balance sheet and moved into 2021 with improved financial health by meeting our 2020 divestment target, reducing debt and successfully extending the debt maturity,” said Vicki Hollub, General Manager.

Occidental recorded a net loss of $ 1.3 billion, or $ 1.41 per share, in the fourth quarter of 2019, which was unchanged at $ 1.3 billion, or $ 1.50 per share. The latest loss included a $ 820 million pre-tax charge on the sale of oil properties in West Texas.

The company raised 5% more, or $ 40.77 a barrel, for its oil in the fourth quarter from the third quarter onwards and benefited from a rebound in oil prices. The company collected 31% more natural gas in the last quarter than in the third quarter.

Occidental projected that oil and gas production would contract by about 4% for the current quarter, largely due to production losses during the recent winter storm in Texas. Shale companies closed some wells as power outages and frozen lines restricted production.

For the first quarter a profit of $ 225 million from chemicals was projected and projected pipeline and marketing losses would widen to between $ 135 million and $ 185 million.

For the year, Occidental’s forecast oil and gas production would remain unchanged from the fourth quarter at around 1.14 million barrels per day. Pre-tax earnings from its OxyChem Chemicals business are expected to show profits of between $ 775 million and $ 825 million, offset by a pre-tax loss in pipeline and marketing businesses of between $ 650 million and $ 750 million.

Occidental reiterated its investment plans of approximately $ 2.9 billion this year.

It plans to sell $ 2-3 billion worth of real estate this year, with the proceeds being used to pay off approximately $ 33.6 billion in debt.

Reporting by Jennifer Hiller in Houston; Adaptation by Sonya Hepinstall and Matthew Lewis

Original Source © Reuters

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