Occidental Petroleum (OXY)

Jeff Alvarez Vice President of Investor Relations
Vicki Hollub President Chief Operating Officer
Rob Peterson Senior Vice President Chief Financial Officer
Jeanine Wai Barclays
Doug Leggate Bank of America
Neil Mehta Sachs
Raphael Dubois Societe General
Neal Dingmann Truist Securities
Phil Gresh J.P. Morgan
Paul Cheng Scotiabank
Leo Mariani KeyBanc
Call transcript
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Good afternoon and welcome to the Occidental's Third Quarter 2021 Conference Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask question. [Operator Instructions]. is event this note being recorded. Please now Jeff Alvarez, would like Relations. to to over conference the Vice turn I President Investor of Please go ahead.

Jeff Alvarez

participating Thank thank XXXX afternoon, Good Call. and for Conference you. Quarter Occidental's everyone. Third [Indiscernible] you And

that of Vicki to On Operating President the slides Vice Chief available Officer, today afternoon, This section Senior Chief Financial will Peterson, on Hollub, slide Officer. turn website. the statements The Vicki. our X cautionary Rob this ahead. call we us on call President with includes are the and go to will now made Investors refer presentation regarding be afternoon. a statement over Vicki, will the please on forward-looking I call

Vicki Hollub

Jeff, afternoon, Thank and everyone. good you,

with of this record reducing driving prior quarter generated a Our and OxyChem applied cash our which and our free performance. we quarters in strong our operational efficiency operational businesses and financial Consistent performance sheet. records Rockies, year, Permian benchmarks. level financial before teams, our and over balance strengthening towards in and continued set Gulf we working of new excelled, Operationally, Oman flow debt capital, quarter. robust Mexico strongest the XX a had years third

cost structure as was case quarter, results, flow capital solid cash generation. last As for foundation intensity leadership a the served our provided in our catalysts, and financial strong for free

operations OxyChem quarter this during Mexico, by impacted of were Ida. Gulf and Our Hurricane

performance employees storm. our operations triggered teams been of closely Mexico have that primary not working events pleased the affected contractors The caused people Our that our progress, balance of overcame Cyclone the We like our during and Ida online will safety safe Oman Oman I'll our that by in our we those and best remain storm. morning, operational were the back cover fourth along with from the recover of in to were divestiture well-being 's to Shaheen. as Gulf and challenging Muscat, third capital to the with they I'd quarter lasting as OxyChem our were pass and the people are guidance. of impacts. quarter focus could recently our devastation Rob all and how no relieved well to with hear results and also by This was by I sheet improvement, wishes cover our were coworkers and as impacted more financial

Our midstream guidance remains the capital be to the flow supportive consecutive This and focus The and leadership continued earnings our on free quarter fourth cash guidance cash operational generating as environment for free and intensity success our to third that record a and level price includes production third in of produced quarter and margins. an for in is full-year flow. has maximizing improvement increase OxyChem. an commodity quarter the

third quarter was the fact, it's the flow least In free cash turn of the century. our highest at been since

quarter. in the As which included of periods for the noteworthy extended reached is you production higher Total end know, a accomplishment significantly downtime that frame high the oil prices. quarter, our several of the considering cost guidance time in resulted safely Hurricane third higher-than-expected on with production, and of the the for shutting Mexico. the Gulf production ongoing domestic Ida's then and and costs impact operating quarter projects, evacuating in platforms restarting associated

delivering. earnings many since the and OxyChem's business capable quarter for relatively our guidance strongest line last in call, Our it's is highlighted we strengths the fourth and free consistent what were flow generation. normalized and On cost our great earnings quarter example of XXXX, domestic our year. operating conditions OxyChem's the of expectations with cash reflects third previous

to tight Louisiana The earnings. period operations. fairly supported than capacity OxyChem by temporary. when market were CBC Ida stronger in impact Our resulting caustic in based continued anticipated to was 's inventories pricing quarter the production already and from OxyChem facilities Storm benefit historical Hurricane disrupted standards. third reduced

the Our transportation utilize midstream quarter marketing the volatility needed contracts In by the again price by once team expertise environment, to rising of delivering capitalize team their on was timing towards during product gas most. for to able marketing and crude The margins and solutions, directing maximize our yielding able during a the natural produced a sales export that gas the markets highest spreads. was business to from summary, existing price it to [Indiscernible] the sulfur benefited at and healthy market

shareholders. delivered single as quarters make We a our have owing continue in reduction debt towards settlement $X.X capital move and rate pleased expect strengthening reducing $X.X environment, healthy future of to balance cash continue such million returning necessary to We're approximately in third take a price the swaps. the commodity of debt In of sheet. notional with exited in unrestricted repayment in of quarter. the and notable deliver as additional $XXX debt to sizable billion we billion interest to quarter of to reducing steps we We progress the debt and

our the the of in wells want oil first in generating Our of results. examples the free drilled And outstanding we demonstrate levels consistent setting lateral and record highlight Permian, tire impressive efficiency to I drive so Midland with as for of where teams operational are able new flow. I we quarter. and how cash to to results. global impressed third teams in XX,XXX-foot to gas operational start excellence a be our continue never deliver continue Basin by records I'll several or did

In Basin, were gains Permian. efficiency we of was in drilling than year rig well extend we're Delaware from the beyond the faster days XX% are a ago. recording wells our teams XX The just first One less that delivered year-to-date release. than to spud the

multiples, with of set set team cycle achieved XX new and the drilling the a X,XXX platform records, Rockies we in performance. to Our and set we and record improve drilling new OXY new in time hours. a hosting technologies drilling to production drilled feet In our drilling in Gulf daily Mexico, DJ XX techniques leverage as over record new records Oman, our completions, years. a efficiency teams continued size And Basin

XXth our business the Dolphin last translating was natural TCF The by efficiency calls its delivering in significant milestone gains few into impressive the tangible financial gas on international results. earnings reached highlighted third quarter. are Another have we of

drilling costs to techniques and a and with capital ways We approach will out seek accomplishing while supply to And than supports innovative coupled environmentally quarter. of do commitment all Midland initially socially year. leading continuously our a the I increased this this with deliver Our to production discipline. maintaining in recycling higher new capacity to lower our completion have to partnership third XX% and we're from been higher chain Company, us partners with expansion Basin, will work point that optimization, our water planned enable the volumes in enabled the of Through to development. Curtis our utilize Ranch way. And we're plant to us has recycle pleased midstream we South water This about able plant. to the that by responsible

process beginning In Colorado's at gallons worked with year-to-date, We of lowering using over requirements. to the drilling costs, not development since of closely the have water we to adapt reducing new addition onshore fleets Permian this disposed and and diesel rigs, million became our regulators our frac at process any of August. transition has and South the year. assets, costs U.S. dual-fuel X saved In to emissions. Across Curtis lowering new effective Ranch to

members goal Oxy's resource where serve As and to communities is as educate we on of responsible to the operate, development. our stakeholders a approach

wealth the In see we move process inclusive approach Oxy DJ were counting. for pleased securing to approval permits permits. Our and has September, in with the been additional helpful forward of

Ghana throughout helped engagement gas with strong from a assets our business the to We've to oil for Our permits. sale remains communities support divestiture with development generated are strong momentum XXXX. additional that of The responsible has has we work XXXX, and commitment for large-scale as just and million. there $XXX to our as in program start recently us completed position our secure

we our you many divestiture ongoing have working successfully our we divestiture, with to this of been the The in Ghana billion $X our complete completed to divestiture both As transactions program. Ghana post-Colombia, of have end with the and know, large-scale closed divesting $X partners marking buyers. goal of closely had on

and of now in have $XX third the have billion quarter, August repaid since we of approximately debt repaid the approximately including was $XX that XXXX, We divested billion assets debt. of

to As shareholder continue value, we seek optimize maintain to our we'll portfolio. opportunities focus our on

walk We you results the fourth will through for and now acreage will to financial value they to guidance trades, complete continue or acquisitions the create bolt-on our will our third I who for quarter. Rob, over quarter, the for call if shareholders. hand

Rob Peterson

debt retired $XXX in quarter. the reduce and $X.X approximately after of we our We have of businesses Thank million interest We costs notional Through record third XX, free we year the exited balance rate swaps. you, quarter, In Vicki. billion by financing debt interest of sheet healthy repaid on $XXX prices billion will estimate billion this cash for a in remained generated per well. million going performed and September quarter level third free forward. cash flow with as of commodity $X.X repaying $X.X the

reported robust Similar the the on diluted less for an third consistently on driving our results of of Our return quarter. generation. improved our than announced mark-to-market adjusted to primarily results per profit of flow are our In already profitability $X.XX top to quarters strong results, and share, in operational reported profitability quarter, our due derivatives. year, previous of commodity free following profit current in with impact adjusted price to combination this basis $X.XX cash adjusted environment, our for second we

upwards $XX.X we under We As and our oil hedge recent of our natural prices quarter, made the oil commodity and million improved gas that throughout hedges. price gas third shareholder leveraged appreciate and the under $XX.X recognized payments million prices. position main

Our expire periods. any future have by for end gas and will hedges year, and of new this the not we current hedges oil added

our of marks These reclassified our As Vicki operations discontinued financial large-scale divestiture of our sale the apps on the program. mentioned, as are completion statements. [Indiscernible]

So, there'll be impact production. ongoing no on

generated on towards portfolio our at which We will to from optimization reducing focused debt. apply are cash capital priorities, this in future divestiture cash any currently

production for while high-end have guidance the disrupted million guidance the size-able consider full-year our Mexico for Last of capital billion before unchanged. We our raised raised full-year production storm, our our XXXX, Hurricane Ida Company-wide to remains production. Even Gulf X.XXX guidance of typically BOE day the quarter, guidance impact per third shortly $X.X we full-year quarter. of production our met of this we

be primarily touch will on is gas in due to X X due the to of to the timing Company-wide be Our year, higher production fourth-quarter and quarters spend our segments. rigs plan than capital quarter all our to Gulf Mexico, oil Ida. the of we BOE guidance was BOE example, in moved for fourth the business a which portion third maintenance call. activities which Hurricane quarter prior the fourth in the capital In shortly. of expected million of from this And spend the expected to from X,XXX day start last X.XX the per in per I provided is day, accelerate represents Permian, increase to of

slightly quarter contract, guidance, than and lower our our schedules. planned is sensitivities, fourth Our which third maintenance, production price considers sharing quarter results, activity

We XXXX with. quarter the with average XXXX as expect same approximately to production exit we exited

position not activity through gained will in Texas, to increase And quarter, Permian include quarter and place Mexico. adjustment originally return Delaware, the the our fourth Texas slide cost-savings now quarter announced to we projects are through our Similar into begin rigs, and that in capital updated activity we efficiency scheduled this our have We us two highest will fully of year activity next were XXXX for Mexico New operating funded The in last start improvements Delaware introducing additional two capital in assets. to change will and early of the New the and to XXXX. stronger budget. a optimization fourth

in third that marketing fourth which quarter will the in the expect the market continue We midstream drove quarter. in dynamics performance

and We marketing benefiting have guidance to robust Hosn. differentials pricing gas rig four the Al sulfur reflect increased improved business at

debt be to year-to-date even for also anticipate recognizes OxyChem balance demand. third reflecting stronger performance quarter reduction than do continued record this expect OxyChem, record the only and for have the time appreciates earning and will We We strong year, guidance the increased value product be a we that to and the being improvement. year we the quarter. Not XXXX believe shareholders, sheet delivered for fourth market third to

the we to in ways. As expect benefit several we shareholders debt, to will repay work key continue additional

share Oxy's into prices that First, healthy acknowledge will additional a We have we expect debt that played translate the reduction role enterprise the over last in price Improvement appreciation. value months. XX commodity of

of or lowers a value debt improves, enterprise larger Company enterprise remains is in breakeven. stable basis financing the saved portion The equity a of costs go-forward Assuming our cash will value on reduced. become over flow the time as interest

breakeven cash that including additional in lower cash being a shareholders. flow to expect discretionary We available flow future towards result priorities, capital will our allocate cash returning

As any stronger we additional amount and capital ratable throughout ensure position increase of capital want shareholders, dividend, cycle. the previously, that committed in us returning we in the for today return cash stated to of a interest to payments the sustainable Reducing in sustainable the is future. the places including

fixed Finally, cycle. in interest rate improves any costs our payment commodity lowering form and point optionality or swap the flexible of interest in through the

sheet balance the set ever with next few runway a places clear Our for years. improvement

also value rate the we may year, another additional the improve in or to current could taking curve. approximately repaying exercising $XX debt, a tenders are for X approximately to solutions that's provisions, cash of additional by to approach are retire thoughtful make-whole interest considering. manner are flow Oxy. remaining We a an We attractive which million, $XXX Executing per million opportunistic have opportunity interest and choose uncollateralized of swaps, be rate just at

As our position. by strong efforts Aided capital deleveraging our position priorities, to we expect our we Oxy's strengthen. advance financial liquidity and

on our we we discipline, value preparing an shareholders. financial over we now with As for the create will focus for ahead will to back and believe I year are of end responsible the turn XXXX, which call operations Vickie. the unrelenting near safe,

Vicki Hollub

be call. to Thank take plan, of you, We now announce we'd calls in that understand call. next our our interest we'll level high there's for segment happy But a this your XXXX in Rob. the which of


the questions to one begin and Please session. now primary one will [Operator We question-and-answer Instructions]. limit question follow-up.

questions, have If you further you re-enter queue. may question the

Jeanine from with comes today Wai question first Barclays. Our

Jeanine Wai

afternoon, morning, good Hi, for questions. Thanks taking good everyone. your

marker, growth. see net question first And it begin perhaps the Our matter do to on layering to actually about models you getting suggest year-end. $XX macro can Balance if growth that's our about for is of Sheet that achieve oil to the sign all-clear billion case, of is the the prices, depending on When order you that by the debt waiting just and some for a give capital? you in

Vicki Hollub

to billion. slide getting that achieving $XX we lot Certainly, a debt of are toward net target of

that, to would our next the So, sooner priorities, in we follow we're would there start cash with our we'll flow of dividend. do terms But to flow what get going to commitments we fixed than expected. cash our increase after line be and the to in

at So feel the next be would cash priority, really flow-generating would growth of growth's our for we we not terms of capability. be that today, need sake. respect the dividend, in of where orders provide standpoint we growing is like our target. time growth from We for growth Future support us don't of to in this are really,

Rob Peterson

at debt top debt the point. to that add our stop I'll Yeah, going priorities dividend in we've cash and Jeanine, our as that, we on at that reduction to reduction put to into beyond maintenance billion. of Vicki's flow our capital. feathering not discussed other priority continue We're to comments get just $XX and We'll

Jeanine Wai

other Okay. businesses the can has of rivaling tremendous capture, carbon we of a I different over in core And maybe to the think the Vicki, as potential that kind And of you've business competency roll be energy And transition, OXY your pivot absolutely past, in the carbon OXY's capture to and it's this clearly of maybe area. going then sized time. in growth.

on If and any as a discuss updated that, carbonate overall be can OXY's management if future or your have on comments you that'd Company? you update just view great

Vicki Hollub

becoming in you what with for as successful doing. for that think global at a energy management the happen really this degrees. believe be to doing we're with needs X.X We Company. cap actually to know, respect are to energy lot -- still transition what we're that, gap are do there's transition us a filling moving others needed going -- carbon still be and Every a to that's toward and warming We to

some working and the to both from are needed. that gap operations, and in working is We're emissions renewables. the also that taking oil there much necessary, but their filling. more core reason for COX moving with we we're confidence working not oil those the recovery. hard And gas have the ongoing others very reducing reasons. that's our current is several nobody enhanced that you advantage current a of So, from companies on handling all know, towards a We're that, else is that but as of operations. believe to We mitigate industry very emissions are of on and COX there's gap And that's renewables are of for

of First world atmosphere. the has that There's to disputes COX removed from nobody the all, in be there that.

be capture for going is that Air Direct So, to critical to happen.

the oil enables So, such develop with but with can industries zero not helps to Air also decarbonize provide that's fuels [Indiscernible] us and to That Aviation, only or that net Maritime that carbon. us COX from as Direct we remove or capture, produce carbon. the net-zero net-negative atmosphere, are and either

So, there removal that it things first Capture for versatile, are atmosphere, provision the you Direct build fuels, those X can reasons the the of very Air it to the all net-zero makes for anywhere. carbon from and is providing build

we provides for technology. a world be to these part the that a and need of us impact the to that because be built, around thousands of actually in magnitude and the So, it think the to leader of that big the opportunity developing be

need So, think a lot next And some COX the towards will progress time, go management that will carbon but I make transition. that XX-XX Company we becoming Company. I of take over for we transition we'll the think The those to offsets. years,


Doug America. question with comes of Leggate Bank next from Our

Doug Leggate

us of like -- couple a I'd week, to of I afternoon. don't got I guess. it I've Welcome earnings comments. thanks for me minute, now. questions do kind the to end cash Vicki, Good here. around thinking of indulge for you closing a guess of And specifically the my return out, Thanks. if is layout

Your are numbers to extraordinary cash clear our not feedback you're market only back and high pretty stock is right question. today. sight when one share debt. acknowledging, first giving the on deleveraging, my cash second prices to not Let's lagging you I yield returns that so something think free a badly obviously. about line of Company practically our guess meaningful flow Despite to the And return investors. the That's is such that has My a My question how assume the your is. net appropriate cash or is, persists. mechanism question flow do level, cash no yield? there's has free [Indiscernible],

Sheet. you do other do targeting it surpass level you Second no returns, be? where the $XX long-term mechanism The to for question, is is cash right Where billion-dollar your debt debt. First level Balance target, once of you mid-cycle question, think net your of appropriate the want

Vicki Hollub

Well is again, know, mentioned billion to Rob target. than as net now that as our to get you we in $XX much sooner expected. And of debt line sight and earlier, around was target

achieved don't to that of things until to some So, beyond once to a gone I we can the layer and make notably would be where most see and we'll grow capital happen. dividend other actually we need point growth again, our to then we've in a primarily that we that, fixed have that, begin then do cash with

it's feel couple I that very over like talked we keep around to we've breakeven of last the about $XX. think our important years

would forward, and growth dividend dividend rate. move as established in match grow a our flow we to So, cash we fixed the the

when that the actually the that of considerations over use reestablished that time we depend respect really and will the fixed grown on will So in with to It existing actually dividend or will we're other cash. have. we have for circumstances it happen it happen

Rob Peterson

into I into to got Vicki range return What done debt been Yes. I if value we that every is, this raising We billion indicated sense to shareholders. messaging we've deleveraging before add consistent that process. we've that guess $XX as can going were increasing of what market we considered to is. the get said we

yet we of so, anticipated. lot sight. the we scrip all that if is it in shareholders a we're but have not messaging, continues because not the we've plan closer that and the work than commodity than way, sticking of of do reach shareholders. we're front did, prices we It line because obviously and would that's be But target. the that anticipated. increasing cash, the we And out combination we that aren't much there out why set our far to it's of to sort And It's of reason value stronger away heard our we'll return

And don't marketplace. the from want so, certainly for we that inconsistency to that deviate to bringing plan, prematurely us bring message to

Doug Leggate

the Okay, They've a like guys, flow off extraordinary. jump cash is the this come given a at saying, looking follow-up. example. and basically Apache free I'm where quick essentially, I'll they're out yield you is it. framework guys,

back And so, of at a really here. buy I'm to bunch driving what That's we're stock. going

whether material. the Your you leave capacity pretty there. it would preference Can what the I'll shares to offer any be kind for be potential why that case relates buybacks and Thanks. is it practical? to as buybacks not limitations might out of thoughts share as around

Vicki Hollub

say that would not stock we're at the conditions of are we $XX what's macro net what the yet, see point. want and our billion happening to at with debt I that and

possibility any dividend will the but right can us, we -- is share follow the longer-term what direction thing it's we do not for flow is are we're our nearest dividend. the before else. priorities, the on first So, which one term. repurchases we that would be term The The really to would we a would which since growing cash now provide anything tell fixed hard there, you not nearest The and consider do.


from Our next question Goldman with comes Sachs. Mehta Neil

Neil Mehta

levels? oil natural tools should move see prices that that you mitigate capital, elevated around the But are months. just And into talk the to bit can 'XX in just what team. we year at inflation to more afternoon, going trending the how cost recognizing as first provide sustaining you as Vicki little is on have the clarity arise about 'XX. stay place a you're you Good that question coming in

Vicki Hollub

I'll take first. one the second

some to business inflation. service of it. continue we how providers situations of we what to our -- world. We're the materials our try more have help and and but efficiency worked to all established would supply sure relationship business not We're right necessarily mitigate see will with on But only what teams the hard can around that now there's respect Our manage efficiencies position think the that inflation also so will with and chain, of today. right a know work hoping of around the our to be, kind to to of than it. just don't we contracts that mitigate situations we going providers lot improve further We establish that especially and strength our would and in mitigate our to U.S., we in not mitigate but

we did well. really leveraging have about we're could terms is to, I And of whatever many be will today. on I XXXX, s in what that, With we've certainly XXXX. sustainability DAC complete top the can't have amount we that as to before mitigate as we would capital, thing say as respect the in So, inflation, what only this we said point in of to won't that

about a is there. year. We in XXX there DACs this difference completed So,

both of we X before. make have Al In begin areas, in will that, capital XXXX. some we've Hosn to other we'll addition to going the to mentioned expansion of in that we're which that investment need

costs incremental of some Mexico. have the also Gulf We'll cost. that in have we'll So,

had capital a the it million in little than is year, will investments. the golf $XXX bit we because higher this terms So, of be lumpy

for have putting when are we'll XXXX. to those plan things So, we final together our consider

Neil Mehta

That's helpful. the the composition the just And is follow-up portfolio. of

over Rockies, different incremental do the where East. of Middle Permian, Is laid the you've see of represent what How see an already evaluate area there a to that beyond amount you you is evolving buckets, upstream capital out? going you Mexico, As Gulf time? disproportionate the

Vicki Hollub

a will maintenance bigger growth to would The continuing what we're do decline There by capital of that have Basin. doing. some portion the anywhere -- in of usually of even up offset our declines. we're to capital the than that may Permian Permian be be in receive starting the our always played else or But areas areas as the or all made role

Middle a for East, example, some for is the area In the us in down-market that provide development the very contracts because helpful to fact, there protection continue PSCs us do.

important us our we cash from quickly. respect. low back of is to there a that Oman cost So, fairly we get development have And do

of good Oman delivers that's the Al So decline a good returns low asset for as in Hosn us. and part

it's role want So, at -- the building this continue going back for of anthropogenic low it we a be growth that our that to of we COX. on building lot as to to assets, some get that'll be will plays IOR but decline -- point start there

will sustainability we'd go bigger low the future. So, to in to beyond you the role know, But play ultimately, Permian are the are decline in the dollar Permian. assets important a our us. But bulk of


Raphael from Societe General. Dubois, comes question next with Our

Raphael Dubois

for thank afternoon and my you taking Good questions.

we on return instead large you is shareholder by program are dividend, agree the The somewhat you all your that think us is considering shareholder it you why by a of a undervalued. please more buyback one Can increasing first -- appropriate to remind I think start repair. you follow-up starting

make Thank So, program? you start more much. it very sense not lot of to would buyback a by

Vicki Hollub

prior The things reality the is is but for not that level, that is that our the time dividend over better creator the increase believe -- shareholders. to to value it restoring continuing multiple our there could it restoring are predictable a more cash. and we with We do

it back Company. We're always get all or would point to do a we make evaluate we saying want and since be so buybacks But where that to a paying for never assessment. get it just now us important that -- to the data we consider the not to dividend I'm that a it not at to shareholders. able make been always it. our have never It's have more to level -- more to We meaningful where it's

For at we're debt. $XX example, not today net billion

look high when we the are But Now, is determine it. available cash It's to we us we have significantly. look calculations to cash, restoring always priority do. because that to the consideration. back will and start value we at available. take the we a And But it did get to at buy it things the the We won't all we would opportunities a just then do have reduce would that whether to dividend anytime shares. beyond starting us a grow for have fact of there, sense, given we other that makes today

Raphael Dubois

your the there's And on short OxyChem. QX. amazing guidance Great. extra as of you for seasonality business. [Indiscernible]. results as accident in QX nothing always this considering were strong of usually is much QX Thank an very One The and question in QX not in is

us So, a some tell of the we can When your you more about do terms bit normalization think supply expect dynamics should of and chemical in business? demand. you market maybe

Rob Peterson

Happy Sure. Rafael. it, discuss to Yes.

the I impact almost thus correct. in say, year, and step seeing back -- time, had vinyl today not in beginning supply at and in the just year, we quarter. into the had states already that see So, February, in we're industry the at what the freeze lost in you production the far but And seasonally the on the was which of we're of Ida gulf commit months strong steady third and because X of then look pretty Typically, in of we business, the that we because of is business, tight improvements still the very chemical would entering if period slower you're condition coffee business. our a normally

year. deck the included. year-to-date business production to those business. come lost post started on the year. the from are for caustic soda both PVC and up domestic year-to-date XX% the rates PVC COVID when and even The of this XX% picking months the So, of the demand and for as and operating kept, over the combination going coupled demand despite versus as than that's of Obviously, we is the typically profit strong of the all main Those last over the anticipated, year. our being the the demand supply-demand storms time last products, the up XX impacts business And X was the driver are on [Indiscernible] main are business or kept historically was with X we has drivers the balance earnings Slide tighter much X of

you it that levels historical soft The because with very being looks still is very strong resin very being still, over a tell and versus what the inventories inventory exports I not our discretionary can to And exports low That's year. Even you are just remains that is X/X is prior have levels. because the tight say other really construction down sector building thing products year. is available. would are with compared prior year COVID like

margins based which domestic your you're And the and resin producers with spot time. for resins going exported flow elevated really the for get means U.S. contractual an to market, period long-term only that not PVC still people so, resin overseas. prices is which the from through sales into market, elevated just that up destined to seeing And are keep of trying

flavor for strong necessarily Construction the spring like construction have way don't looks do the early to inventories ready it year winter. And it the what to are atypical next a so the year. pretty during to restock of is how we we that's year. going Does another set which all kind to much to this But of for winter? return to will continue year. time continuing has people of want be see for balance What slow in the

I'd On has the extremely chlor producers. -alkali chlorine side, say tightest

vinyl making many think OxyChem so making just the parts vast still of the the all methane outlet. core -- our just own chain. is This us gives the where a of thinking markets, And our polyurethane etc. are market not to water and for trying value we're us business. because that traditionally domestic 's water highest gives at treatment the to TiOX beyond others of We're much others strength are derivatives portfolio we're X also selling PVC, into markets, We exposure versus

we're side backside And operating also rebuild of of in things all balances are demand, not there's lot in demand chain, we're see, strong the of still more back And difficult the as return continued side a than so on demand and but those normal to in tight. we of again, pandemic, likely manufacturing Asia somewhat seeing Europe. A back over is pent-up restored the very industry. improvements. We're the will coming particularly supply in caustic America and effort inventories, to continue only supply seeing in another to both the seeing PVC, in been like but e. to not seeing demand some the on caustic soda improve be will we risen soda record caustic on prices haven't are for that prices on have the the levels we're and South activities Asia, What yet steady seen globally, as

right strong And so, businesses both very now. are

longer don't just but caustic the a so are the [Indiscernible] transport seasonal because it winter, really see caustic once industry to able inventories -- in no it domestically, see slowdown river enough for you're tight. because will we impacting We

will tight spring slower I still probably going running to such period January, to so, inventory. industry, with February, think it's hit a quick pretty be again. months a but We'll the ground And the continue just for the narrow in be


Our next Truist Securities. Neal question with comes Dingmann from

Neal Dingmann

strategy share the just how maybe had on in about I guess you just on for sit Vicki, just that discipline some just today thoughts you when some share I if rigs, can broadly adding light but thinking currently growth thanks of, you, today. you're sort minor your a comments where time. Permian know you of maybe versus just could on with Rob capital

Vicki Hollub

net we'll we not us capabilities $XX target a now. not cash our and growth I strategy priority Because that's debt right say flow that too, our our for it's basically. at it's billion for forward, that generating with end. production around you where is get to going of would look When if us

down target working would get we to just And again, debt would We there. to to next start need billion as bigger to the not dividend at reduce our about Rob to our a to what growth need don't additional the level We with And more be next and can growing debt least that again. increase need the again, start beyond there Because continue do we continue at the we we'll with dividend. where expect at mentioned, it's the information couple to growth growing of growing reduction. respect share get in As our we level so which then increase next macro of able believe to -- what the the the over dividend, dividend want be our would to road, production years. be the we over couple without do production only that we point really to $XX our be that. from is we But want production years. to now right any the of

then dividend us, would of projects occasional going our are other to the capital, it's our like to operations, debt further our level, be the reduction. continuing these and next beyond the [Indiscernible] Hosn, that and maintain sustainability Al be production it GoM, years. could facility, But So, that, over couple those or than

Neal Dingmann

decline And helps your I low with in that? assume all

Vicki Hollub

yes. important strategy. to these why that's that decline Oh, Yes. on us it's me? projects enabled have low Pardon And to this execute

Neal Dingmann

the of potentially more last you've could, carbon this or something at area? a upstream if some I you carbon help you expedite can plans I'm did even prior, then you about hopes plans this tax think maybe expense the low your call of and to come if and Absolutely, going think past one expedite towards an others than and just the mentioned, maybe having credit the In one I that is low would expedited others maybe on maybe in that last needed help cash the QXX and wondering, is just business. to get still you

Vicki Hollub

have to to industry. on XXQ. not that through is the pay needed has for of supporting our do happen at direct facilities that the that. the DAC is the it strength U.S. that's I can board and world world It the the Air would And to And it has XXQ pace way say retrofitting the and only to do the just with and to for happen, get carbon U.S. acceleration has the it. that capture, the and absolutely capture capability best way Direct

So, not right less Accord, important That Glasgow the happening on set will prior with much achieve Otherwise, you're us. in to incredibly the that. U.S. that's targets even Paris we've the now. right that what's

get price to XXQ to net achieve some Everybody be be and happen. price incentives be for a with because to I make to to successful. what at pay. So like really going be happen of struggle there to to to going Otherwise, But doing, a direct the goals neutral. there's is corporations if to XXQ, think that we're from needs has mechanism on our through some commitment we're lot it carbon then have we realizes is don't going to now there point respect carbon

are we're a Capture the the capture want social have Direct we're they are start would that, lot get feel been getting starting calling you committing the of oil has know, that net neutral. the Direct to we've a of do have is -- Other to that of announced that And they trying that. that. one license so, that ahead has in zero seeking be of are the United corporations interest corporations there purchase Air are us, building and corporations Air as lot of operate proactively and of oil. proactively is to credit that plus the a become to to of dollars because seeing, incoming to offsets to what to to A COX net they there that lot

commitment. that here it's again, and believe what is be initial to than growth there's we're do in next in sufficient I -- to So, that, doing work. what much the phases But going require acceleration going more that. make To beyond


question J.P. Our with from comes next Gresh Phil Morgan.

Phil Gresh

opposed afternoon, it to one some years you WTI where then about how a And calculate break you multiple would clarification the sounds the all Hey, to of talked are even. good $XX $XX get around wanted I question once. wanting like to dividend just just grow have follow-up WTI -break-even And up situation would as to want today. at we you dividend to

just around that place. clarification So

Vicki Hollub

that's the right upper in probably assuming is -- clarification now, not we're on that's that's breakeven. without preferred. -- a But The Yeah. XXs the

close stay. and to we're be want we want So, to where where to we really

do As the past. we the at a it the grow but we time, that level, done a probably over that as moderate us -- grow enables we'll in restore it not to pace we've in at dividend way

material dividend a will be we've moderate always tried as to but be it in will it So, maintain. growth,

Phil Gresh


willing the within WTI clear? $XX keep you for to dividend the just go dividend that, to above you be are to or So, want the breakeven

Vicki Hollub

want to keep within it we Ultimately, that.

do going by debt. growth, some the and to be mid-cycle, discussion but $XX start again of -- dividend when will out billion we how that what get there's supported net supported breakeven. be $XX by a We'll determine that some we to Now, what be evaluation see would what we'll

Phil Gresh

Do What have a Got us you'd you it. full U.S. with cash situation payer? cash around you one your taxes? And Rob. follow-up could is a sense for U.S. tax there's when share that there become

Rob Peterson

see we for Phil, where based certainly taxes any in taxpayer of see anticipate don't we this again, XXXX, cash our the XXXX. think upon year cash viewpoint I certainly happening in also macro meaningful U.S. a ourselves, becoming material you that don't the a on of standpoint, depending way conditions,


from with Paul Our Cheng comes question next Scotiabank.

Paul Cheng

that opportunity you to see good afternoon, that to guys I for Conoco. Shell Please. partner you think that guys. operator to you. their asset different for opportunity and usual, are either that this as just first and the do maybe really as associated Two business with questions just doesn't have is anything? if That's or see a work question. the additional seeing that, with or you Hey, you other just change asset sold swap Permian want given a

yet your oil focus the the you sector when how that has about On to in and clear, mean going have you been asking maybe gas chemical? think capex and very the unique made not you're about everyone you're I increase I a you anytime chemical, But position. second in question the soon. guys

much that then terms have they before, been grow so also and you in You typical and than quite housing are any been that well, with in chain. transition. that really do And better you expand has business? very energy do doing strong the [Indiscernible] good of to the And or not sector intention be have

that. from -- of standpoint Thank terms in is your see to overview you. growth want prospect So, for that. a What

Vicki Hollub

the Shell core and we to operate. I'll we're up opportunities while for with start assets, always looking

been the working successful. been our we and years us that's a helping part that already areas big of operate interest the have over swaps increase last very to in Assets few

[Indiscernible] our operations will are work. We better always we're be and we'll Conoco for that Because continue win-win Company. those make other any scenario. with are working and to are try in we that that have and Those current do swaps to near to partners each

those really to something that's we'll for us important do, continue or that. So

The second question part of is the

Paul Cheng

between before [Indiscernible] going reached out that. guys talk do? the to you to that already you Conoco and is Actually, or Have Vicki. already on and you or you that that out this reach something that

Vicki Hollub

Shell with we in conversations. had Well, for conversation a had been time long we have and certainly

Our us have about things We teams best worked be pursue potential of both on swaps. to that. to we contact so be that and had Conoco think and with for open other it would

they done Shell, that but opportunities Rob same just again, grow. ensure in with to very market But I more. been this market out better past to into has with mitigated So have to business, With build we're risk by opportunistic the as partners, knows than risk do, we the doing taking, the working with without OxyChem OxyChem Conoco. respect

Rob Peterson

to build COX our gives been Polyurethanes. or markets. build Paul projects, we've cracker add, would it the in chlor we want I we together, plant that have what of us leaders is, that partner plant or an and your to Otherwise, If the was the have, to industries. pseudo whether able downstream in entered with built, the with a long-term adjacent customer you into COX back do partnership -alkali -- those is in look Komorze than etc. end is we history angle-size the don't are relations integration it

cash the to be business the fund capital return flow point, to on as it's something the a we're around always but going rest going continue the necessarily from structure guaranteed so, remainder of where And evaluating Vicki's we're the to that, and cash towards that of a we're source.

growth product. in right, end I the vinyl versus up Like are that one lot else, anything has that constantly to a the a dozen advantage probably the good works the significant. drawing you U.S feedstocks that of as is of pretty But evaluating -- And board one that get think that. on there's there core out. we're the building projects world; a sector is the rest

those continue we with together, to to we'll and happy if share So, the comes will evaluate market. it something

Vicki Hollub

in is And key certainly, you're OxyChem will and really All we're be player partners to that any story. existing open right. with to it in a our transition part that. new help and from our that of important an opportunities of partners

Paul Cheng

some years They longer the X into or what next capital new bid foresee term? do OxyChem growth on can. the over And you X guys

Rob Peterson

on I and the of hard to it think there. say, out investments mean, what It's Paul. are timing opportunities depends I the

our evaluating investment to might it constantly if it be the sense. OxyChem. integrate that in would we would I on made speculative we're next purely make so, And and give portfolio significant But in timing when


Our final Mariani question with today comes KeyBanc. Leo from

Leo Mariani

bit you little the comments Hey, that on guys guys wanted made. a of one to prepared follow-up

you be commented think the there some could bolt in future. I ons -

get for pretty to sense in be asset what a general given doing types had last wanted of Just of prolific of for the sale program years? might advertise you've those Oxy's things couple a just that

Vicki Hollub

would some only to it have. opportunity and if And was currently that that strategic, to very have longer fill we gap interest something would do the picking already acreage situations There’re laterals. it situations working there up own. we something enable us where are drill increase Yes, where that we we in the

to do along, when chance get do otherwise, to that do situations need again. may almost you it are you the those not so they And come it

Leo Mariani

the also situation your just there you ask Direct projects. to you funding Okay. guys, capture It that might for have then sense makes and wanted Air is on update

off-balance think external that. were for you guys I sheet financing seeking

Vicki Hollub

day right is now, of then, but talk be the to working about quarter first a we're on an plan or to hope We don't lot publicly. our update event we By in what hold have still currently, year. to an LCD able next of

Leo Mariani

Okay. Thank you.

Vicki Hollub

you. Thank


would question-and-answer over the Vicki This concludes to back I for any call like to our Hollub remarks. session. turn closing

Vicki Hollub

you our questions all a and day. call. Have great joining for your for Thank


presentation. now The you Thank concluded. has conference for today's attending

You may disconnect. now