Occidental Petroleum Corporation (OXY) is making significant strides in its debt reduction program, reporting a $3 billion decrease in principal debt during the third quarter of 2024. This achievement is attributed to strong organic cash flow and proceeds from asset sales, including the anticipated closing of the $818 million Barilla Draw divestment. With this progress, Occidental has now reduced its debt by over $3.8 billion year-to-date, representing approximately 85% of its near-term target of $4.5 billion.
The company’s proactive deleveraging strategy involves both asset sales and utilizing free cash flow. Last week, Occidental raised $700 million through the sale of 19.5 million common units in Western Midstream Partners, LP (WES). This brings the company’s total completed or announced divestments for 2024 to approximately $1.7 billion. The proceeds from these divestitures are being used to further reduce debt.
Vicki Hollub, President and CEO of Occidental, expressed satisfaction with the company’s progress, stating, “We are pleased with the rapid and significant progress of our deleveraging program along with enhancements made to our already premier portfolio. By the end of the third quarter, we expect to achieve nearly 85% of our near-term $4.5 billion debt reduction commitment.”
Beyond debt reduction, Occidental continues to invest in its core business. Earlier this month, the company completed a $12 billion acquisition of CrownRock, strengthening its Permian portfolio with 170 Mboed of high-margin production.
For investors seeking exposure to OXY stock, options include the Texas Capital Funds Trust Texas Capital Texas Oil Index ETF (OILT) and the First Trust Nasdaq Oil & Gas ETF (FTXN).
As of Monday’s market close, OXY shares were trading up 0.51% at $57.91.
