[Editor's note: This story was updated at 7:18 p.m. CST Nov. 5.]
U.S. oil and natural gas producer Occidental Petroleum Corp. (NYSE: OXY) beat third-quarter profit estimates on the back of a surge in production from the Permian Basin and higher oil prices.
U.S. shale oil production from the Permian has nearly doubled in the last three years, while Brent crude touched a four-year high in September. Occidental said average worldwide realized crude oil prices rose 36% to $62.67 per barrel in the third quarter.
The company, which has been investing heavily to boost production in the Permian Basin, said output from its Permian Resources unit surged about 62% to 225,000 barrels of oil equivalent per day (boe/d).
Occidental's average production rose about 13.5% to 681,000 boe/d. However, the company lowered the top end of its full-year forecast for total output to between 655,000 boe/d and 659,000 boe/d, from 650,000 boe/d and 664,000 boe/d.
Sales in Occidental's chemical division rose 10.6% to $1.19 billion, helped by demand for caustic soda. The division, the company's second biggest, makes plastics used in pipes and siding.
The Houston-based company's net income surged to $1.87 billion, or $2.44 per share, in the quarter ended Sept. 30, from $190 million, or 25 cents per share, a year earlier.
In the latest quarter, the company benefited from an after-tax gain on the sale of midstream assets of about $700 million.
Excluding one-time items, Occidental earned $1.77 per share topping analysts' estimates of $1.54 per share, according to IBES data from Refinitiv.
Shares of the company rose about 1% in after-hours trading.
Occidental plans to hold a conference call with investors to discuss the quarterly results on Nov. 5. The company is one of the largest operators and oil producers in the Permian Basin and also has operations outside the U.S. in the Middle East and Latin America.
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