Occidental Petroleum Acquires 10% Stake in Exxon Mobil's Deepwater Block
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Occidental Petroleum (OXY) is buying a 10% interest in Exxon Mobil's (XOM) deepwater exploration block offshore Trinidad and Tobago, Reuters' Curtis Williams reports, citing two people familiar with the matter. Exxon used to be the sole owner of the block, known as UD(1), which exists in water depths of 2,000-3,000 meters and was first acquired in August of last year, the author says, noting that sources did not know the value of the transaction.
Trade with 70% Backtested Accuracy
Stop guessing "Should I Buy OXY?" and start using high-conviction signals backed by rigorous historical data.
Sign up today to access powerful investing tools and make smarter, data-driven decisions.
Analyst Views on OXY
Wall Street analysts forecast OXY stock price to fall
16 Analyst Rating
4 Buy
9 Hold
3 Sell
Hold
Current: 57.320
Low
38.00
Averages
47.27
High
64.00
Current: 57.320
Low
38.00
Averages
47.27
High
64.00
About OXY
Occidental Petroleum Corporation is an international energy company with assets primarily in the United States, the Middle East and North Africa. The Company is an oil and gas producer in the United States, including a producer in the Permian and DJ basins, and the offshore Gulf of Mexico. Its segments include oil and gas, and midstream and marketing. The oil and gas segment explores for, develops, and produces oil (which includes condensate), natural gas liquids (NGL) and natural gas. The Company's midstream and marketing segment purchases, markets, gathers, processes, transports, and stores oil (which includes condensate), NGL, natural gas, carbon dioxide (CO2) and power. The midstream and marketing segment provides flow assurance and maximizes the value of its oil and gas. It also optimizes its transportation and storage capacity and invests in entities that conduct similar activities. This segment also includes low-carbon venture businesses.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Abel's Key Investments at Berkshire Hathaway Post-Appointment
- Successful Oxychem Acquisition: Berkshire Hathaway's acquisition of Oxychem for $9.7 billion came at a strategic low point in the chemical industry, with an estimated 8x EBITDA for 2025, enhancing the company's competitive edge while retaining preferred shares in Occidental, yielding an 8% dividend.
- Strategic Investment in Tokio Marine: Abel's $1.8 billion investment for a 2.5% stake in Tokio Marine, with the option to increase to 9.9%, strengthens Berkshire's insurance business through a risk-sharing agreement, despite paying nearly double the book value, which could yield significant returns.
- Precise Timing for Alphabet Increase: Abel's decision to triple Berkshire's investment in Alphabet to $11 billion in Q1 positioned it as the fifth-largest equity holding, benefiting from a market recovery and strong earnings, with the stock price rising approximately 35% since last quarter.
- AI-Driven Revenue Growth: Alphabet's cloud revenue surged 63%, with operating margins expanding from 17.8% to 32.9%, as AI integration enhances search and advertising revenues, indicating strong growth potential moving forward.
See More
Abel's First Quarter Investments Yield Positive Results
- Successful OxyChem Acquisition: Berkshire Hathaway's $9.7 billion acquisition of OxyChem was timed perfectly at the chemical industry's low point, with an estimated 8 times EBITDA for 2025, and future modernization efforts are expected to enhance cash flow and profitability.
- Strategic Investment in Tokio Marine: Abel's $1.8 billion investment for a 2.5% stake in Tokio Marine, with the option to increase to 9.9%, not only strengthens Berkshire's insurance business but also introduces a risk-sharing agreement that could yield further upside, positively received by the market.
- Increased Stake in Alphabet: Abel tripled Berkshire's investment in Alphabet to approximately $22.5 billion, spending around $11 billion in the first quarter, benefiting from market recovery and strong AI performance, with the stock price rising about 35% since last quarter.
- AI Driving Revenue Growth: Alphabet's cloud revenue grew 63% in Q1, with operating margins expanding from 17.8% to 32.9%, and the integration of AI technologies is expected to further enhance profitability in search and advertising, positioning the company for sustained growth.
See More
Energy Stocks Decline as Nextpower Acquires Battery Firm
- Energy Sector Decline: Energy stocks fell for the fourth consecutive day after President Trump indicated a potential deal to end the U.S.-Iran conflict, with OneOK leading the S&P 500 energy sector down over 3%, reflecting market concerns about the industry's outlook.
- Nextpower Acquisition: Nextpower's stock surged 13% following its announcement of acquiring battery storage company Prevalon Energy for approximately $365 million, while also raising its full-year revenue guidance, indicating its strategic expansion in the renewable energy sector.
- Dell Technologies Surge: Dell Technologies' shares jumped 29% after raising its full-year guidance, projecting adjusted earnings of $17.90 per share and revenue between $165 billion and $169 billion, significantly exceeding analyst expectations, showcasing strong market demand recovery.
- American Eagle's Poor Performance: American Eagle Outfitters' shares dropped 13% as comparable sales at its American Eagle banner fell 2% in Q1, with second-quarter guidance disappointing analysts, highlighting the sales pressure and intensified competition it faces.
See More
Occidental Petroleum Acquires Stake in Trinidad Deepwater Block
- Stake Acquisition: Occidental Petroleum is acquiring a 10% interest in ExxonMobil's Ultra Deep 1 block offshore Trinidad and Tobago, gaining access to a high-potential deepwater exploration area that enhances its global business diversification.
- Resource Potential: The block is adjacent to Exxon's Stabroek block, which has made 30 discoveries totaling 11 billion barrels of recoverable oil and gas, currently producing 900,000 barrels per day and aiming for 1.7 million barrels by 2030, indicating significant upside potential.
- Investment Plans: ExxonMobil plans to invest $42 million for seismic surveys and potentially drill two exploration wells six months post-survey completion, which could provide Occidental with a long-term growth catalyst if successful.
- Strategic Implications: This acquisition allows Occidental to replenish resources to counter production declines while further diversifying its investment portfolio globally, thereby enhancing its competitive position in the oil and gas sector.
See More
US-Iran Conflict Escalates, Oil Prices Surge Amid Economic Uncertainty
- Escalation of US-Iran Conflict: Following weeks of paused action, the US and Iran have resumed airstrikes, complicating hopes for a permanent resolution to the conflict, which is impacting global oil supplies and market sentiment.
- Strong Stock Market Performance: Despite rising geopolitical tensions, both the S&P 500 and Nasdaq Composite closed at record highs, primarily driven by a surge in AI-related stocks, indicating strong market confidence in the technology sector.
- Oil Price Warning: ExxonMobil has warned that oil inventories are on track to reach dangerously low levels in the coming weeks, forcing prices to spike and curbing demand, reflecting market concerns over energy supply.
- Wealthy Investors Pulling Out: According to the UBS Global Family Office Report, 60% of family offices plan to adjust their investment allocations in the next year, with many reducing US holdings and increasing exposure to emerging markets, highlighting a growing trend of 'de-dollarization'.
See More
U.S.-Iran Negotiation Fluctuations Impact Markets
- Oil Price Plunge: Oil prices dropped over 5% on Wednesday after Secretary of State Marco Rubio indicated that Washington was giving Iran talks 'every chance to succeed,' reflecting market sensitivity to diplomatic efforts and potentially impacting energy sector profitability.
- Escalation of Military Actions: New U.S. airstrikes in Iran targeted a military site deemed a threat to U.S. forces and commercial maritime traffic, adding uncertainty to the ongoing diplomatic negotiations and prompting investors to reassess risk levels in the market.
- Strong Tech Stock Performance: Shares of cloud-based AI and data platform company Snowflake surged 36% following a strong earnings report and a $6 billion investment plan in Amazon Web Services, showcasing investment enthusiasm and market confidence in the tech sector amid rising AI demand.
- Inflation Data Focus: Investors are closely watching the upcoming April inflation reading, which is expected to influence the Fed's future rate decisions, as Minneapolis Fed President Neel Kashkari emphasized that lowering inflation remains a top priority, indicating market sensitivity to economic policy.
See More
Abel's Key Investments at Berkshire Hathaway Post-Appointment
- Successful Oxychem Acquisition: Berkshire Hathaway's acquisition of Oxychem for $9.7 billion came at a strategic low point in the chemical industry, with an estimated 8x EBITDA for 2025, enhancing the company's competitive edge while retaining preferred shares in Occidental, yielding an 8% dividend.
- Strategic Investment in Tokio Marine: Abel's $1.8 billion investment for a 2.5% stake in Tokio Marine, with the option to increase to 9.9%, strengthens Berkshire's insurance business through a risk-sharing agreement, despite paying nearly double the book value, which could yield significant returns.
- Precise Timing for Alphabet Increase: Abel's decision to triple Berkshire's investment in Alphabet to $11 billion in Q1 positioned it as the fifth-largest equity holding, benefiting from a market recovery and strong earnings, with the stock price rising approximately 35% since last quarter.
- AI-Driven Revenue Growth: Alphabet's cloud revenue surged 63%, with operating margins expanding from 17.8% to 32.9%, as AI integration enhances search and advertising revenues, indicating strong growth potential moving forward.
See More
Abel's First Quarter Investments Yield Positive Results
- Successful OxyChem Acquisition: Berkshire Hathaway's $9.7 billion acquisition of OxyChem was timed perfectly at the chemical industry's low point, with an estimated 8 times EBITDA for 2025, and future modernization efforts are expected to enhance cash flow and profitability.
- Strategic Investment in Tokio Marine: Abel's $1.8 billion investment for a 2.5% stake in Tokio Marine, with the option to increase to 9.9%, not only strengthens Berkshire's insurance business but also introduces a risk-sharing agreement that could yield further upside, positively received by the market.
- Increased Stake in Alphabet: Abel tripled Berkshire's investment in Alphabet to approximately $22.5 billion, spending around $11 billion in the first quarter, benefiting from market recovery and strong AI performance, with the stock price rising about 35% since last quarter.
- AI Driving Revenue Growth: Alphabet's cloud revenue grew 63% in Q1, with operating margins expanding from 17.8% to 32.9%, and the integration of AI technologies is expected to further enhance profitability in search and advertising, positioning the company for sustained growth.
See More
Energy Stocks Decline as Nextpower Acquires Battery Firm
- Energy Sector Decline: Energy stocks fell for the fourth consecutive day after President Trump indicated a potential deal to end the U.S.-Iran conflict, with OneOK leading the S&P 500 energy sector down over 3%, reflecting market concerns about the industry's outlook.
- Nextpower Acquisition: Nextpower's stock surged 13% following its announcement of acquiring battery storage company Prevalon Energy for approximately $365 million, while also raising its full-year revenue guidance, indicating its strategic expansion in the renewable energy sector.
- Dell Technologies Surge: Dell Technologies' shares jumped 29% after raising its full-year guidance, projecting adjusted earnings of $17.90 per share and revenue between $165 billion and $169 billion, significantly exceeding analyst expectations, showcasing strong market demand recovery.
- American Eagle's Poor Performance: American Eagle Outfitters' shares dropped 13% as comparable sales at its American Eagle banner fell 2% in Q1, with second-quarter guidance disappointing analysts, highlighting the sales pressure and intensified competition it faces.
See More
Occidental Petroleum Acquires Stake in Trinidad Deepwater Block
- Stake Acquisition: Occidental Petroleum is acquiring a 10% interest in ExxonMobil's Ultra Deep 1 block offshore Trinidad and Tobago, gaining access to a high-potential deepwater exploration area that enhances its global business diversification.
- Resource Potential: The block is adjacent to Exxon's Stabroek block, which has made 30 discoveries totaling 11 billion barrels of recoverable oil and gas, currently producing 900,000 barrels per day and aiming for 1.7 million barrels by 2030, indicating significant upside potential.
- Investment Plans: ExxonMobil plans to invest $42 million for seismic surveys and potentially drill two exploration wells six months post-survey completion, which could provide Occidental with a long-term growth catalyst if successful.
- Strategic Implications: This acquisition allows Occidental to replenish resources to counter production declines while further diversifying its investment portfolio globally, thereby enhancing its competitive position in the oil and gas sector.
See More
US-Iran Conflict Escalates, Oil Prices Surge Amid Economic Uncertainty
- Escalation of US-Iran Conflict: Following weeks of paused action, the US and Iran have resumed airstrikes, complicating hopes for a permanent resolution to the conflict, which is impacting global oil supplies and market sentiment.
- Strong Stock Market Performance: Despite rising geopolitical tensions, both the S&P 500 and Nasdaq Composite closed at record highs, primarily driven by a surge in AI-related stocks, indicating strong market confidence in the technology sector.
- Oil Price Warning: ExxonMobil has warned that oil inventories are on track to reach dangerously low levels in the coming weeks, forcing prices to spike and curbing demand, reflecting market concerns over energy supply.
- Wealthy Investors Pulling Out: According to the UBS Global Family Office Report, 60% of family offices plan to adjust their investment allocations in the next year, with many reducing US holdings and increasing exposure to emerging markets, highlighting a growing trend of 'de-dollarization'.
See More
U.S.-Iran Negotiation Fluctuations Impact Markets
- Oil Price Plunge: Oil prices dropped over 5% on Wednesday after Secretary of State Marco Rubio indicated that Washington was giving Iran talks 'every chance to succeed,' reflecting market sensitivity to diplomatic efforts and potentially impacting energy sector profitability.
- Escalation of Military Actions: New U.S. airstrikes in Iran targeted a military site deemed a threat to U.S. forces and commercial maritime traffic, adding uncertainty to the ongoing diplomatic negotiations and prompting investors to reassess risk levels in the market.
- Strong Tech Stock Performance: Shares of cloud-based AI and data platform company Snowflake surged 36% following a strong earnings report and a $6 billion investment plan in Amazon Web Services, showcasing investment enthusiasm and market confidence in the tech sector amid rising AI demand.
- Inflation Data Focus: Investors are closely watching the upcoming April inflation reading, which is expected to influence the Fed's future rate decisions, as Minneapolis Fed President Neel Kashkari emphasized that lowering inflation remains a top priority, indicating market sensitivity to economic policy.
See More
