Occidental Petroleum Corporation (NYSE:OXY) Q4 2022 Earnings Call Transcript

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And really scope was pretty well managed. We — our maintenance activities picked up a bit at the end of the year, mainly downhole maintenance and EOR. As Vicki said, as you go into 2023, it’s much more balanced. If you see the increase, there is a little bit of kind of inflation carryover in terms of processing and CO2 volumes are up a bit this year for EOR as we’ve resumed activity there, but it’s a lot more scope. So as we begin to resume production activities, water management, compression, these type of things show up. But by and large, we’ve been able to hold that cost structure for OpEx pretty well. We go back really kind of first quarter ’20 and look at those type of run rates, and we’ve been very good holding our cost structure since that.

Probably the last thing I’d say kind of to the maintenance activity similar to the GoM, for us, in U.S. onshore, it’s a lot about uptime improvement. So continuing to work with a third-party gathering and processing companies and then within our fields to be able to be resilient through weather and just sort of manage this production in a good way. So adding that uptime adds significant value to the year. And so some of our OpEx-related activities have been focused there as well.

John Royall : Great. And then next one is just on the quarterly progression of production. And apologies if I missed something here, but I see that the midpoint of production guidance stays the same in 1Q versus the full year, but you do have the Permian ramping and you have the Al Hosn project starting later in the year. So what are some of the moving pieces there that are kind of pulling things the other way? And then how do you expect production to progress throughout the year?

Richard Jackson: Maybe I’ll start just kind of a U.S. onshore perspective. Permian being able to ramp up to the end of last year and really secure the resources by the end of the year puts us in a much better position for sort of steady-state growth. However, the first quarter, as we noted, is a little lumpy. We had about 40% less wells online versus kind of other quarters in the year or even against fourth quarter. It’s a little lumpy on the Permian — And then really the moving part is the Rockies. We’ve been underinvested from sustaining capital over the last several years. And so as we talked, resuming some activity there. We have about a fourth quarter ’22 to first quarter ’23 about 15,000 barrel a day decline and that sort of steadies out into the second quarter.

And then we actually start growing in the Rockies in the second half of the year. And so that, from an onshore perspective, is a big part of that moving part. And then the other one is really our GoM weather assumption. So I think that’s the other piece to consider when you look at the trajectory on total.

Vicki Hollub: Yes. In total, as Richard mentioned, GoM will be down a little bit, international up a little bit Al Hosn comes on and comes on stronger towards the end of the year.

Operator: And ladies and gentlemen, in the interest of time, this concludes our question-and-answer session. I’d like to turn the conference back over to Vicki Hollub for any closing remarks.

Vicki Hollub : Thank you. I’ll first by expressing my gratitude to our amazing teams for their diligent focus and pioneering work that contributed to so many advancements in our core cash generating and emerging Low Carbon businesses so much appreciate all that you do and for always going above and beyond. Thank you all to the rest of you for joining our call today for your questions. Have a good afternoon.

Operator: Thank you. This concludes today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines, and have a wonderful day.

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