Occidental Petroleum reported a $635 million quarterly profit that dipped 25 percent from the year prior, but the focus still remains on Oxy’s $38 billion acquisition of Anadarko Petroleum that could close in August.
Houston-based Oxy said it plans to close the Anadarko deal next week after the scheduled Aug. 8 vote of Anadarko shareholders to approve the deal.
In a brand-new deal though, Oxy said it formed a new Permian Basin joint venture with Colombia’s state-owned oil company Ecopetrol to develop nearly 100,000 net acres in the Permian’s Midland Basin.
To help Colombia develop expertise in shale oil development, Ecopetrol will pay Oxy $750 million up front and carry another $750 million in capital into the partnership. Oxy will operate the joint venture and own 51 percent of it.
“As we move toward closing the acquisition of Anadarko and combining our two companies into an innovative and sustainable energy leader, we remain well positioned to drive profitable growth and return excess cash to our shareholders,” said Oxy Chief Executive Vicki Hollub. “Our strategic partnership with Ecopetrol is a further example of our commitment to enhancing our value proposition.”
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The Ecopetrol partnership also represents another deal that can help Oxy pay down its upcoming debt from acquisition of The Woodlands-based Anadarko.
As for quarterly earnings, although net profits fell a bit because of cost hikes from merger expenses and other factors, Oxy’s revenues jumped about 8 percent from $4.1 billion a year ago to $4.5 billion.
Total oil and gas production volumes exceeded projections at 741,000 barrels of oil equivalent a day during the second quarter, up from 719,000 barrels daily in the first quarter of 2019.
