In March 2020, Oxy completed the acquisition of Anadarko Petroleum. While there is value in the deal, it will not become apparent until Oxy reduces its elevated debt and can successfully reduce synergies across its entire value chain. We believe Oxy can successfully execute its plan, given its strong operating record. We believe a more robust oil price environment is needed for Oxy to capture synergies and reduce debt.
Occidental Petroleum recently outlined plans to advance its clean energy transition business, including spending between $800 million and $1 billion on a facility to remove carbon dioxide (CO2) from the air. If successful, what we believe is achievable, OXY would become one of the few E&P to be able to capture CO2 and to reinject capture gas into the caverns created while extracting oil and gas. The technology developed benefits form a dual revenue stream: a) government subsidies for developing the technology and for burying CO2 underground, while at same time, b) it sells gas and oil extracted from the same rig.