Occidental Petroleum has announced the sale of certain Delaware Basin assets in Texas and New Mexico to Permian Resources for approximately $818 million. This move is part of Occidental’s strategy to reduce its debt, which stood at over $18 billion at the end of the first quarter.
In addition to this sale, Occidental plans to divest assets worth around $152 million, bringing its total proceeds from closed or announced divestments to $970 million for the year. The company is also preparing to take on additional debt to fund its $12 billion acquisition of CrownRock, with plans to sell up to $6 billion in assets within 18 months after the deal closes.
The transaction with Permian Resources involves 29,500 net acres in the Barilla Draw Field of the Permian Basin, which is the largest shale oil region globally. This acquisition is expected to enhance Permian Resources’ production by an estimated 15,000 barrels of oil equivalent per day (boepd) by the fourth quarter of 2024. The deal is anticipated to close in the third quarter of 2024.
Berkshire Hathaway holds a nearly 29% stake in Occidental. Permian Resources is set to report its second-quarter earnings on August 6, while Occidental will announce its results on August 8.