Occidental Petroleum Corporation
Energy · Oil & Gas Exploration & Production
Permian-pure-play E&P with embedded carbon-management optionality and a Berkshire backstop. 5B near-term paydown target.
- Permian inventory depth post-CrownRock: ~2,000 sub-$60 breakeven locations, ~15yr runway
- $4.5B 2026 debt-paydown plan retires Berkshire pref dividend drag (8% on $8.3B = $664M/yr) at par
- OxyChem run-rate FCF ~$1B floors capex through commodity troughs
- Stratos DAC (250kt/yr) starts 2026; 45Q $180/t credit + Microsoft/AT&T/Amazon offtakes already signed
- Buffett accumulated through $52-55 zone; ~28% holder removes terminal-value tail risk
- ~$24B net debt at $60 WTI strip = ~2.3x EBITDA, no buyback room until 2026 paydown hits
- Preferred 8% coupon is non-callable at par before 2029 - redemption requires premium
- DAC unit economics unproven at scale; $180/t credit assumes IRA survives intact
- Permian Tier-1 inventory exhaustion thesis hits OXY 2028-2030
- Methane fee, BLM rules, and offshore permit drag are real 2026-2028 headwinds