Occidental plans to sell oil and gas assets in the Middle East

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Occidental Petroleum may consider selling oil and gas assets to Oman to reduce its debt burden, an unnamed source known to the file told Bloomberg.

The assets could bring in more than a billion dollars, the sources added.

Occidental has a debt of around 40 billion dollars, most of which was contracted last year by buying Anadarko, a player in the sector, in what many consider today as one of the worst acquisitions of the story, finalized only a few months before the fall in oil prices. About $ 11 billion of this debt is due by 2022, and the company is actively looking for ways to conserve and generate cash.

The acquisition cost Oxy some $ 55 billion and was intended to expand its presence in the American shale field, which was battered by the oil crash. Due to the unfortunate moment of its acquisition of Anadarko, Oxy has become one of the most affected oil players in the United States. Sales of assets, one of the usual ways of reducing large debt levels, will pay much less than before the crisis if they unfold.

Occidental has interests in three oil fields in Oman as well as assets in the United Arab Emirates and Qatar North Field, the largest gas field in the world. He is not the only one selling assets in the Middle East, however. Earlier this month, Bloomberg reported that BP was selling about 10 percent of the Khazzan gas field in Oman, seeking more than a billion dollars for it.

Improving oil prices could help these divestments to continue and help reduce debt. Meanwhile, Oxy cut its capital spending program for its year by more than 50%, surpassing its competitors in the cuts. The company said in May that it plans to spend only $ 2.4-2.6 billion on investments this year and cut costs by some $ 1.2 billion.

By Irina Slav for Oilprice.com

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