Occidental Sells OxyChem for $9.7B, Cuts $5.8B Debt, Raises Dividend 8%
Occidental Petroleum used proceeds from its $9.7 billion OxyChem sale to eliminate $5.8 billion of debt, reducing principal to about $15 billion and strengthening its balance sheet. The company reported Q4 adjusted EPS of $0.31 on 1.481 Mboed production, replaced reserves at 98% total and 107% organic, and guided Q1 volumes at 1.405 Mboed with capex cut 12% below consensus.
1. Sale of OxyChem and Debt Reduction
Occidental completed the divestiture of its OxyChem division for $9.7 billion, applying $5.8 billion of proceeds to debt repayment. This transaction lowered its total principal debt to approximately $15 billion, marking a significant step toward its long-term deleveraging target.
2. Dividend Increase and Shareholder Returns
Following the debt cleanup, the company raised its quarterly dividend by over 8% to $0.26 per share, signaling a shift from strict deleveraging to enhancing shareholder value through cash returns.
3. Q4 Earnings and Operational Performance
In the fourth quarter, Occidental delivered adjusted earnings of $0.31 per share, driven by 1.481 Mboed of production that exceeded guidance, lower operating expenses and stronger midstream margins. Year-end proved reserves stood at 4.6 billion BOE with a total reserves replacement ratio of 98% and organic replacement of 107%.
4. Q1 Guidance and Capital Spending Plan
For the first quarter, the company forecast volumes of 1.405 Mboed, reflecting 4–5% below expectations due to winter downtime, and outlined a capital expenditure program 12% below consensus. Occidental continues prioritizing disciplined spending in the Permian Basin while pursuing further debt reduction.