[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.
Recommended Reading
Exxon, Chevron Tapping Permian for Output Growth in ‘24
2024-02-02 - Exxon Mobil and Chevron plan to tap West Texas and New Mexico for oil and gas production growth in 2024, the U.S. majors reported in their latest earnings.
BP Pursues ‘25-by-‘25’ Target to Amp Up LNG Production
2024-02-15 - BP wants to boost its LNG portfolio to 25 mtpa by 2025 under a plan dubbed “25-by-25,” upping its portfolio by 9% compared to 2023, CEO Murray Auchincloss said during the company’s webcast with analysts.
The One Where EOG’s Stock Tanked
2024-02-23 - A rare earnings miss pushed the wildcatter’s stock down as much as 6%, while larger and smaller peers’ share prices were mostly unchanged. One analyst asked if EOG is like Narcissus.
In Shooting for the Stars, Kosmos’ Production Soars
2024-02-28 - Kosmos Energy’s fourth quarter continued the operational success seen in its third quarter earnings 2023 report.
Stockholder Groups to Sell 48.5MM of Permian Resources’ Stock
2024-03-06 - A number of private equity firms will sell about 48.5 million shares of Permian Resources Corp.’s Class A common stock valued at about $764 million.