OXY(OXY)2025-02-18 21:22Reserves and Production - Occidental's proved reserves for oil, NGL, and natural gas increased to 2,135 MMbbl, 1,236 MMbbl, and 7,443 Bcf respectively in 2024, compared to 1,940 MMbbl, 983 MMbbl, and 6,352 Bcf in 2023, representing increases of 10.1%, 25.8%, and 17.2% respectively[34] - Sales volumes for oil, NGL, and natural gas reached 247 MMbbl, 116 MMbbl, and 739 Bcf in 2024, up from 234 MMbbl, 103 MMbbl, and 656 Bcf in 2023, indicating growth of 5.6%, 12.6%, and 12.7% respectively[34] - Occidental's total proved reserves in the United States were 3,791 Boe in 2024, compared to 3,108 Boe in 2023, reflecting a 22% increase[34] Acquisitions and Investments - The CrownRock Acquisition on August 1, 2024, added high-margin production and low-breakeven inventory to Occidental's oil and gas portfolio in the Permian Basin[30] - Occidental completed the acquisition of CrownRock, L.P. for total consideration of approximately $12.4 billion, with oil and gas properties recognized at an acquisition date fair value of $11.8 billion[359] - A joint venture with BlackRock for a direct air capture facility in Texas involves a commitment of up to $550 million from BlackRock[392] Financial Performance - Net sales for 2024 were $26,725 million, a decrease of 5.6% compared to $28,257 million in 2023[378] - Net income attributable to common stockholders decreased to $2,377 million in 2024 from $3,773 million in 2023, a decline of 37.0%[378] - Comprehensive income for 2024 was $2,960 million, down from $4,776 million in 2023, a decrease of 38.0%[381] - Net income for 2024 was $3,078 million, a decrease of 34.6% compared to $4,696 million in 2023 and a significant drop from $13,304 million in 2022[387] - Operating cash flow from continuing operations for 2024 was $11,739 million, down from $12,308 million in 2023[387] Debt and Liabilities - Long-term debt increased significantly to $24,978 million in 2024 from $18,536 million in 2023, a rise of 34.8%[375] - The company reported total current liabilities of $9,521 million in 2024, up from $9,148 million in 2023, an increase of 4.1%[375] - Occidental's current accrued liabilities increased to $4,256 million in 2024 from $3,854 million in 2023, reflecting a rise of approximately 10.4%[427] - Non-current accrued liabilities rose to $7,030 million in 2024, up from $6,329 million in 2023, marking an increase of about 11.1%[428] Environmental and Regulatory Challenges - The ongoing global impact of the Russia-Ukraine war and conflicts in the Middle East may affect Occidental's operations and market conditions[44] - Changes in government policies and regulations, including those related to climate change and emissions, could restrict Occidental's operations and increase costs[54] - The Infrastructure Investment and Jobs Act reinstated federal Superfund chemical excise taxes on various chemicals, potentially increasing costs and impacting margins for Occidental[56] - The EPA's expanded regulations on chemicals may restrict OxyChem's operations, impacting costs, sales, and margins[66] Carbon Management and Sustainability - Occidental's carbon management initiative, OLCV, aims to capture up to 500,000 tonnes of CO2 per annum, with the first phase expected to start operations in mid-2025 at an initial capacity of 250,000 tonnes[39] - Occidental's carbon management strategy is contingent on the demand for carbon sequestration credits and the regulatory environment supporting such activities[106] - The company faces numerous risks related to its sustainability initiatives, including evolving government regulations and the need for substantial capital to achieve its emissions reduction targets[107] Market and Economic Risks - The company has no active commodity hedges in place as of December 31, 2024, which exposes it to market price fluctuations for oil, NGL, and natural gas[42] - Occidental's ability to access capital markets may be restricted due to rising interest rates and economic conditions, impacting its financial flexibility[48] - The company faces risks from competitive pressures in the oil and gas sector, which could affect its ability to acquire reserves and maintain production levels[74] Operational Challenges - The company operates a solar generation facility in Texas with a capacity of 16.8 megawatts of electricity[40] - Offshore operations expose Occidental to unique risks, including higher costs and operational challenges in deep-water environments[117] - Severe weather events and other catastrophic occurrences could disrupt Occidental's operations and lead to significant financial losses[118] Legal and Compliance Issues - The IRS has issued a notice rejecting Anadarko's tax refund claim of $881 million related to the $5.2 billion Tronox settlement, which could adversely affect Occidental's liquidity and financial condition[46] - A lawsuit filed against BLM permits in New Mexico and Wyoming was dismissed in November 2023, but the plaintiffs' appeal is pending, indicating ongoing legal challenges[60] - The SEC's climate disclosure rules, which require increased reporting on GHG emissions and strategies, may impose additional compliance costs on Occidental[98]